2022 was a challenging year for the transport and logistics sector in Australia. The effects of the COVID-19 pandemic were still making their mark throughout the supply chain, and inflation and international instability continue to impact the sector.
Daniel Antonello, General Manager for Australia and New Zealand from location data and technology company HERE Technologies believes there’s resilience in the supply chain despite the macroeconomic challenges and global inflation.
2023 holds a lot of promise, with businesses set to gradually recover from the setbacks of the past two years. Many are poised to invest in creating a more sustainable and innovative supply chain. We anticipate that key trends for 2023 in the transport & logistics (T&L) space will centre around sustainability, cyber resiliency and tech innovation.
Pushing towards Net Zero and sustainable supply chains
The impact of climate change continues to ripple around the globe, and climate change is once again set to dominate discourse across a multitude of sectors in 2023. The T&L industry is no different. Australia now has a target to achieve net zero emissions by 2050, and corporations are being forced to move towards carbon neutral supply chains due to pressure from customers, investors and mainstream environmental, social and governance (ESG) organisations. The time to invest in a sustainable supply chain is now.
Transport emissions have been on the rise since 1990, and according to the World Economic Forum’s research, eight global supply chains – including those in the food, construction and fashion sectors – are responsible for 50% of carbon emissions. At the recent COP27 summit, the UN’s Intergovernmental Panel on Climate Change (IPCC) stated that greenhouse gas emissions must peak before 2025 at the latest and decline to 43% by 2030 to limit global warming temperatures to 1.5°C.
There is still a lot of work to be done to reduce emissions in the supply chain to meet these deadlines.
Increasing importance of Electric Vehicles
Every state and territory in Australia has plans to increase their electric vehicle (EV) fleet and charging networks. On top of that, the government has also committed funding to expand the number of public chargers. The EV Council of Australia has welcomed these commitments, and says this funding will triple the size of the existing fast-charging network. The EV Council also called on the government to commit to the development and implementation of a mandatory fuel efficiency standard for light vehicles that would support Australia in achieving its target of net zero by 2050.
Looking ahead, there are opportunities for EV manufacturers and map providers to incorporate more data and functionality in their systems to enable contingency planning for a more seamless driving experience. It’s also important to consider the availability of this data. Location tech enables us to not only visualise where EV chargers are located along a journey, but also knowing their precise locations and charging availability. Today we see charge points at airports, parking bays, shopping centres, theatres, and while these locations are convenient, having a central and fresh database of EV charge points with real-time availability is key to encouraging mass EV adoption as it allows users to plan and maximise their travels.
As we continue to encourage the uptake of EVs for a greener future, and with the National Electric Vehicle Strategy taking shape, the government, charging-technology providers, operators, and utilities companies should all consider utilising location technology to strategically boost the availability of charging infrastructure in building a truly national EV charging network. Data on EV charge stations and EV maps can optimise routes for businesses investing in hybrid and electric fleets.
Sustainable fleet management
Australia’s freight task is growing, and the urban freight challenge is expected to see growth of 60% over the next 20 years. Stakeholders in the T&L sector are feverishly working to identify how they can accurately track emissions of their fleets, which will help them understand their carbon footprint before implementing target reduction strategies.
We predict that location technology will play an important role in helping businesses improve their fleet management, including planning, operation and maintenance to reduce downtime at every point in the supply chain. This will ultimately help to reduce fuel costs, driver fatigue and carbon emissions. In 2023, it will also be key for businesses to estimate emissions using data such as vehicle types and detailed maps of routes, including gradients.
Working with Migros, HERE developed a commercial fleet analytics tool that determines the amount of carbon dioxide (CO₂) emissions per route, considering factors such as vehicle and fuel type, weight, traffic conditions and the elevation of the roads on every route. This tool empowers the leading Swiss retailer to reduce their emissions while also optimising their fleet’s navigation routes.
Transportation is one of the biggest carbon emitters, and the sector will continue to focus on reducing pollution. As we enter 2023, we can expect businesses to be more engaged with policymakers as they strive to become sustainability enablers. Technology will play a bigger role in contributing to these data-led solutions.
Supply chain resilience and increasing cyber threat
We expect to see an improvement of supply chain visibility when it comes to operational resilience. Gartner has predicted that 50% of global product-centric businesses will invest in real-time visibility across their supply chain by 2023. As supply chains continue to experience freight issues, the push for visibility only gets stronger. Supply chain visibility will become more important in the face of increased cyber threat. The Optus and Medibank hacks have dominated headlines recently, but not so publicised were the hacks of major companies in our freight and transport industry. We all need to protect our businesses, suppliers and most importantly our customers.
Digital transformation is giving the supply chain sector the tools to deal better with disruptions, but it is simultaneously providing cybercriminals with ever-increasing opportunities to infiltrate companies. Supply chain operating networks are still very complex and fragmented with multiple data-sharing platforms, devices, software and protocols. This leaves businesses susceptible to:
- Cyber attacks from interoperability issues between various IoT devices with no standard protocol;
- Other security concerns including inventory theft, physical device tampering, reliance on third-party vendors, cloud data and increasing sensor data; and
- Difficult integration with software vendors due to different EDI (Electronic Data Interchange) formats and systems used by shippers.
Businesses that take cyber threat seriously are best placed to avoid the threat going forward. Those that ignore it may face unwanted consequences down the road.
Tech innovation will be crucial to business survival
As digital transformations happen across all industries, experts are realising they need to focus more on customer centricity. We expect digital innovation to drive changes to meet the evolving customer demands and expectations will be critical to business survival. Innovative end-to-end digital solutions have become similarly critical to holistic supply chain visibility. These advancements allow multimodal tracking of high-value and time-critical goods with up-to-date information on estimated times of arrival (ETAs) and conditional events.
We also predict that the push for Intelligent Speed Assistance (ISA) will gather momentum. In the Europe Union (EU), for example, new vehicles introduced to the market from July 2022 must have an ISA system fitted. From July 2024, ISA will be mandatory for every newly registered vehicle. As a result, we anticipate that ISA will become popular in Australia as well. Based on research from around the world – including Australia – ISA can make a significant contribution to road related deaths and injuries, while also contributing to the reduction of CO2 emissions.
HERE Technologies has significant experience in supporting ISA and is now enabling more than 30 brands from 15 global automakers with HERE ISA Map data to comply with the EU mandate. Based on what is happening overseas, as well as our ISA expertise, we think that Australia should actively pursue ISA as a priority to keep our roads and drivers safer.