3 Jul 18

Last Mile Delivery, Last Trends

Carriers are squeezed between the pressure of increasing e-commerce, and increasing traffic congestion, traffic restrictions in cities, and environmental concerns. However many companies are looking to make lemonade of the given lemons.

With the rise of online purchases, carriers are experiencing a golden age, but at the same time the increased traffic and resulting traffic congestion, delayed delivery times, environmental concerns, and traffic restrictions, force the companies to look for alternative last mile coverage.

According to McKinsey three consumer delivery models are likely to dominate the last mile in the future: autonomous vehicles, drones, and bike couriers. 

Zero Emission

In the meantime, to reach zero emission and bypass traffic restrictions, many carriers are electrifying their fleet.  UPS, for instance, has recently deployed 50 plug-in electric delivery trucks as a pilot project in urban areas across the US. Moreover, the company already rolled out smart charging software at a central London facility. 

The company StreetScooter, a subsidiary of Deutsche Post DHL Group, is specialized in the production of electric commercial vehicles, with a special focus on last-mile coverage. In its portfolio, the company offers not only electric vans and cars but also electric bikes and trikes. 

UPS introduced e-bikes in its fleet, while DHL introduced its Cubicyle beginning 2017 to pick up packages in dedicated City Hubs. Bikes will be faster, greener, more flexible, and in the end better for the image of the company. 

Besides bikes or electrifying the fleet, hydrogen might be a solution to reach zero emissions as well, such as the pilot project of FedEx. Fedex’ hydrogen vehicles will have a range of 160 miles, which is more than the 90-mile range of its electric battery powered vehicles. 

Drones and Robots

Taking e-delivery to the next level is the implementation of drones and autonomous vehicles. UPS already began testing the use of drones for emergency deliveries of medical supplies. Various pilot projects have also been set up with autonomous vehicles, from the autonomous vans to the little delivery robots of Domino Pizza. Nevertheless,  these technologies have so far been part of pilot projects or experiments, since practical and legislative aspects are preventing the widespread implementation and use.

Last experiment

The last remarkable experiment created to address the increased e-commmerce, is the crowdsourcing project of e-Gigant Amazon. Private partners will be able to create their own fleet as part of the bigger Amazon fleet. In return for a $10,000 start-up cost, the prospected annual profit could reach $75,000 to $300,000, with annual revenue exceeding $1 million, up to $4.5 million, although Amazon gives no guarantees.

Last mile, not the Last Solution

When it comes to last mile delivery, we have not seen the last solution yet. All big carriers are looking for ways to reconcile increased demand with increased mobility pressure. 

Authored by: Fien Van den steen