The Future of Freight Forwarding: A 2022 Outlook

Supply chain efficiency and reliability have been called into question throughout the past two years. Here are a few recent news items that we think may spark changes or increase awareness in the freight forwarding industry.

Congestion at container ports

Sometimes, circumstances beyond our control cause delays in our freight forwarding plans. European ports are currently seeing massive congestion for imports and exports due to supply chain disruptions in China and sanctions on Russian cargos and shipping routes. Container port delays are also expected in the busy Shanghai ports in the coming weeks due to new COVID lockdown restrictions in that country.

Increasing visibility in global end-to-end multi-tiered supply chain networks

There has been a massive global concern around supply chain disruptions amongst businesses, shippers, and consumers. We expect to see many organizations looking for ways to track their shipments better and keep a closer eye on their shipments.

Virtual watchtowers may provide greater visibility into the location of assets or goods to increase compliance for on-time deliveries. This may include creating software or a system that uses situational awareness to analyze shipping data from many different sources. The ultimate goal is to provide a more accurate big picture look at the shipping and supply chain industry to look for ways to improve efficiency and identify potential future risks.

Russian sanctions to affect supply chains around Europe and Asia

VR, Finland’s state-operated train company, recently announced it would stop all train routes to and from Russia in response to the Russian invasion of Ukraine. This cuts a key tradeline in the region that will have ripple effects across Europe. As other countries impose similar import and export restrictions, this will have an even more significant global impact that we’ll be keeping our eye on.

Electric Class 8 trucks making a positive environmental impact

Ground shippingby semi-trailers isn’t known to be the most environmentally friendly shipping option due to the large amounts of fuel these trucks require. With the rising cost of gas (due in part to sanctions on Russian oil), some ground shipping companies are looking to electric rigs to save money and the environment.

Maersk recently announced ordering over 100 electric, class eight trucks from Volvo Trucks North America. Other trucking companies are following suit and looking to Electric. The Volvo electric trucks get a range of about 275 miles per charge, and they can charge to 80% in 90 minutes.

New Trucking regulations coming in 2023

As we prepare for the future of freight and shipping, we need to know about new trucking regulations coming into effect in the US in fiscal 2023. The new rules are to increase truck safety, update truck compliance procedures, and encourage the use of automatic emergency braking and autonomous driving regulations.

Many federal organizations are looking to increase their staffing to deal with the increased expected workload next year. The Federal Motor Carrier Safety Administration is asking for budget to increase its full-time staff from 1186 to 1285. The National Highway Traffic Safety Administration wants to increase its staff from 357 to 428 full-time spots.

Companies going green

Businesses across many industries are turning to greener ways of doing business, and so are the shipping and freight forwarding industries. Cainiao Network in Hangzhou and Ningbo in Zhejiang Province have installed solar panels over 100,000 square meters of their warehouse roofs. This installation can store 7.862 megawatts of energy and generate over 8 million kWh in annual power output. That’s enough to power 3,000 households for a year.

This photovoltaic power system will power their facility and send extra power back into the local China electric grid.

Green initiatives throughout the shipping industry are gaining momentum. One article in AirCargo Week quotes Kenny Kwong, a chief executive at Hactl, saying the going-green delays are more around mindset than technical ability of green systems. Incorporating eco-friendly projects or carbon-neutral business practices may be costly at first, but pay for themselves quickly.

Autonomous cargo drones: Coming soon

We’ve read that companies are planning to deliver packages via cargo drones. FedEx announced a partnership with Elroy Air in San Francisco this past week to develop the world’s first “end-to-end autonomous vertical take-off and landing (VTOL) aerial flight system.”

With this technology, the company will no longer be delayed in traffic or affected by staffing shortages. Packages can be delivered faster than ever before. This is an exciting technological advancement to keep an eye on in the future.

Amazon to expand its global presence in Turkey

In the latest news from Amazon, they recently announced plans to open its first fulfillment centre in Turkey. This $100 million project is expected to create over 1000 new jobs in its first year. It will also be powered 100% by electricity, to reduce its reliance on fossil fuel combustibles. It is a step forward in the company’s goal to be a net-zero carbon neutral business by 2040.

More digital tools to optimize operations

Synkrato recently announced it’s incorporating artificial intelligence, augmented reality, mobility, and the internet of things (IoT) to create a platform to revolutionize the logistics market. With their program, users can create a 3D digital twin of their warehouse facilities and populate it with their inventory and logistics data. This will allow them to visualize better and optimize their space and resources. You can create this for your company with no coding knowledge.

What’s the future of freight forwarding and shipping?

Based on recent news and projections, the future state of the industry looks somewhat unknown. We expect the most significant driving factors influencing these markets to be: