When the Coronavirus disrupted the world, the logistics and transport planning sector designed new routes to track. Within the large distribution network, technological innovation and approaches to environmental sustainability lead.
Logistics in Italy: Writing a different story
We could start this post by saying that the Covid-19 pandemic, the various lockdowns, and the never-ending series of openings and closings, consequently, of the multiple economic, cultural, and social activities that have occurred in 2020—and that continue to occur—are the sole cause of the complications in the logistics system seen during the past year. That delays in deliveries or the unavailability of goods are some of the possible outcomes if the management of transport is conducted in an imprecise manner or if the relevant planning is not properly executed. We could keep talking about resilience, but we won’t.
That’s because it’s only part of the narrative. What happened in 2020 put logistics in the limelight, and this was not a limit but an opportunity.
Ivano Russo, general manager of Confetra (Italian General Confederation of Transport and Logistics), shared a harsh but frank response to an interview with ShipMag at the end of the just-concluded 5th edition of Shipping, Forwarding & Logistics meet Industry.
This is an annual event dedicated to the encounter between the world of logistics, shipping, and transport, and the Italian productive economy with the political and administrative institutions of our country. The event, promoted by Confetra, ALSEA and The International Propellers Club, lasts three days and, for this year, was held completely online from March 8–10.
In Russo’s words, a harsh consideration of the logistics practices of our country in the recent decades could be felt. But at the same time, there was an incredible desire to do and change the current situation. To start again. And to start again, the time has come to rethink logistics from a Made in Italy perspective, to write a different story from the one we are used to reading. A story in which Italy, too, can reinvent itself with creativity and proactivity, with a new vision that transforms its weaknesses into strengths, as pointed out by Zeno D’Agostino, President of the Port System Authority of the Eastern Adriatic Sea, at the above-mentioned event. A story in which Italy can play a key role in the logistics and transport planning sector.
Efficiency, optimization, organization: qualities that must never be lacking in the transport sector
Underestimating the importance of logistics is like letting one’s guard down. According to Russo, it means saying that our country is not interested in 65 billion euros in revenue a year. “It means no longer being masters of the destiny of our products, it means not being able to make environmentally sustainable choices in terms of transport, shipping, and distribution. Furthermore, weak logistics with a limited range does not allow the country to concretely control its economic interests in the global chessboard of international trade.”
In transport planning, the fundamental and discriminating aspects are efficiency, the optimization of cost and time, respecting the established picking and delivery windows, and the organization of the daily management of logistics activities. At the same time, to render transport systems sustainable, it is necessary to improve the efficiency of the transportation itself within the supply chains. At a global level, we also compete on data management, information transfer time, as well as goods.
It is no coincidence that at Ublique, we have made transport planning one of the key solutions.
How much does the transport industry burden the environment?
According to US Green Technology, the transportation industry is the largest source of CO2 emissions in the United States, followed by the electricity and heating sector. In the Journal of Transport Geography, the transport industry represents approximately 22% of the greenhouse gas emissions, of which road transport corresponds to three-quarters of the share. Air and sea transport account for 11%. Often, most of the products and goods we use are transported by trucks. Many highways experience high amounts of highway congestion and some routes can be extremely inefficient. Let us be reminded, moreover, that all this transportation produces a daily amount of waste that is transported from one place to another.
Manuela Medoro, an environmental analyst at Ecocerved, claims that the production of waste in Italy related to road vehicles amounts to 200 million tons each year.
However, 20% of the waste is generated within the same municipality and 25% of the trips occur within 100 km. The overall impact in terms of CO2 is equivalent to 1 million tons. Thus, this is clearly not just about road transport. In fact, if you think about it, a single product can be transported by plane, ship, train, or truck; it may travel long distances before arriving at its final destination, following intricate distribution routes. Each of the main modes of transport requires its own mitigation strategy but a general, shared, economic, and certainly cultural change is needed. Today, due to the Coronavirus, we all have a greater awareness of the importance and crucial role that transport planning and logistics play overall in the globalized society in which we live. For this reason, we must also work on another type of awareness: that linked to the need to think and act sustainably.
Green New Deal, Next Generation EU: European plans for a green, sustainable, and innovative economy
Covid has certainly been the driving force behind the changes happening today. The Green New Deal (GND, also called the New Green Pact) is a European reform plan that aims to eliminate economic and social inequalities to render the European Union economy sustainable, focusing on renewable energy and energy efficiency. The Green New Deal endeavors to make the European continent the first to achieve net-zero climate impact.
In this sense, the GND is one of the viable approaches—together with the recovery plan for Europe, Next Generation EU—to sustainability and technological innovation. By 2050, the EU will want to—actually, must—achieve climate neutrality through an action plan that involves all sectors of our economy, while ensuring a just and inclusive transition.
Through the European climate law, this political commitment is transformed into a legal obligation. It will therefore be necessary, among other things, to support industry in its march towards innovation to introduce forms of public and private transport that are sustainable from an environmental, health, and economic point of view by investing in environmentally friendly technologies.
Towards an electric revolution in the transport sector for a radical paradigm change
According to the Osservatorio Nazionale on mobility trends, road traffic of light-duty vehicles has undergone a significant reduction (up to 80% in the period March–April 2020) since the start of the current pandemic that began last year. In July 2020, this reduction was still not fully recovered. “The second wave of the spread of Covid-19 in the fall produced less marked impacts on road mobility than those of the first lockdown, with a reduction of 40%”. This can also be due to the different restrictive measures adopted based on the different colored zones in the various regions of our country.
In 2020, registrations of fuel vehicles fell by 28%, equivalent to 535,000 cars of which:
- -40,2% diesel,
- -38,7% gasoline,
- -31,1 % LPG,
- -18,1 % methane.
In contrast, the diffusion of electric cars has shot up to + 250%. According to Repower, for two-wheeled vehicles, there has been an increase of + 268.8% for bicycles, + 125.7% for motorcycles, and + 20% for e-bikes.
A 2021 white paper published in Repower, titled Sustainable Mobility and Electric Vehicles (5th Report of 2021), states that electric vehicles will become the most economic choice in many parts of the world within the next five years, “helping to shape the sustainable transition of the energy sector as a whole”.
Electric mobility involves not only two or four wheels, but also the marine, air, and heavy-duty vehicle sectors. All means of transport must be involved in reducing emissions. In fact, these are sectors that strongly influence the world transport economy: they represent over 80% of the world’s traded goods in terms of volume and over 70% in terms of value that travel overseas, becoming about 3% of the global carbon dioxide emissions.
Logistics and technology, an essential combination
To ensure that the logistics system remains competitive and efficient, the system itself is changing by focusing on technology. The Internet of Things and the Blockchain allow both the tracking of goods—in real time and without the need for human intervention—as well as the fight against counterfeiting and the monitoring of the fleet of vehicles. The Blockchain also helps in the management of transport documents. Basically, logistics and transport planning activities are making increasingly intense use of cryptotechnologies and, simultaneously, of artificial intelligence.
The pandemic has contributed, once again, to steering also the delivery methods, greatly accelerating those that boast contactless mode, even for accompanying documents and for customs checks. And, once again thanks to the use of new tools and technologies.
Contactless, over-boxing, and sustainability
But “what sustainability problems does the delivery world pose?”, the Retail Institute Italy asked Fausto Caprini, CEO of Retex, a company that is involved with innovation and technologies in retail.
The packaging issue is worrying, to say the least. It’s called ‘over-boxing’ and 165 billion packages are shipped every year to the United States, as Caprini says. Basically, we are talking about a quantity of cardboard equivalent to over a billion trees and 30% of the solid waste produced in the United States alone, according to The Guardian. To these already alarming numbers, we must add those related to the CO2 emissions necessary to transport the products contained in these packaging. But as we have already mentioned, we know that in the US, it is the transport industry that represents the highest amount of greenhouse gas emissions.
Improving sustainability standards in the transport sector means working on all of this. It involves significant changes in how communities move, how products and goods are shipped, and how future transportation routes are designed. In this sense, the keywords of today are, and will increasingly be, transportation planning, route optimization, and vehicle routing. And these keywords are exactly what characterize Ublique.
Using a software system to manage orders, plan deliveries, and optimize routes (better known as Transportation Management System, TMS) certainly has economic advantages. But that’s not all. It also responds to the need, in terms of sustainability and ethics, of reducing the number of tons of waste produced over time, mentioned previously, and to prevent that number from continuing to grow exponentially.
DO YOU WANT TO KNOW MORE?
The Amazon Effect has completely transformed the management of logistics and production systems. Fast shipping, efficient transport planning, and route optimization are the new must-haves for companies that want to...
The economic crisis due to Covid 19 has forced all market players to rethink the logic and dynamics of the entire supply chain as well as transport planning.