Overinvestment in load matching technologies isn’t solving deeper transportation issues

Since 2011, $302 billion of venture capital funding has been invested in supply chain technology, leading to advancements on a decades-old, fundamental logistics problem: matching loads to trucks. Obviously, there are benefits to increased supply chain visibility ⁠— fewer empty miles, increased driver retention, predictive analytics, as well as improved communication between shippers and carriers. But are these innovations sufficient to address the most highly impacting issues facing the industry? 

During a recent interview with FreightWaves, President of PGT Trucking Gregg Troian explained that the load-matching trend has seen various iterations over several decades and doesn’t adequately meet the dire needs of today’s supply chain constraints, driver shortage and polluted environment. Founded in 1981, Pittsburgh-based PGT Trucking is a flatbed transportation company, serving the steel, building materials, machinery, oil and gas, raw materials, aluminum, and automotive industries in the U.S., Canada and Mexico.

“In 1995, I was part of a company that developed a technology called E-flatbed, which was designed to match flatbeds with loads,” Troian said. “Almost three decades later, people are still trying to develop new ideas and methods for using ‘proprietary’ software to match a load with a truck. They get investors and media coverage, but it is the same thing over and over, and it just doesn’t seem to be working or solving the larger transportation issues. I think it’s time to start looking at other things.”

As for those “other things,” PGT has become involved in two forward-thinking strategic partnerships this year. In June, to confront both the driver shortage issue and move freight more efficiently and sustainably, PGT has placed an order and has additionally invested in autonomy and AI through its partnership with Locomation. In October, to achieve an improved carbon footprint for customers’ supply chains, the flatbed carrier signed a letter of intent for 100 battery- and fuel cell-powered trucks from Nikola Corporation. 

A naysayer might argue that until autonomous vehicles are deemed safe by federal regulation and testing and electric vehicles are trusted and readily available for purchase, improving these table-stake efficiencies through load-matching technologies is a necessary means to an end. But could the industry’s uncertainty around autonomous and electric vehicles be indicative of a cultural reluctance to materially act against climate change? Troian didn’t think so. 

“I don’t think there’s a hesitation about working toward a cleaner environment; I think the hesitation is trusting the technology,” he said. “The industry is waiting for proof that all this technology is actually going to come to fruition and perform. But, battery-powered electric vehicles seem to be gaining more traction, and I think that’s because there are now a number of producers. The motors are improved, the batteries are improved. The promises from manufacturers that the equipment’s going to work are starting to show truth, which gives those that are buying this equipment more confidence to invest.”

As for automation and PGT’s partnership with Locomation, Troian expects to see their autonomous relay trucks on the road early next year. He thinks the future of shipping will lean toward autonomy, which will slowly revolutionize the way trucking logistics works. 

“Until you have absolute and total autonomy, where these trucks can go anywhere, anytime, day or night, we’ll start off with semi-autonomous vehicles in certain lanes ⁠— very tight lanes or maybe weather-friendly lanes. This could be the case for a while, and it will push us to look at logistics differently. Where can we place warehouses or distribution centers in different locations to support autonomous vehicles? No longer can you look for some inexpensive land and build up in an obscure location. You may  have to consider whether autonomous vehicles can service those locations and reimagine how a distribution center works.”

With this future in mind, PGT is trying to stay ahead of or at least in lockstep with its customers ⁠— even steel manufacturers ⁠— that in the past two years have made some significant commitments to reaching net-zero carbon. For a steel company to reduce its carbon footprint, it will have to depend heavily on its transportation providers, perhaps ones that will transport steel in a vehicle producing only water as exhaust. 

“Customers haven’t necessarily come out and asked us to pursue these partnerships,” Troian said. “I’m trying to get ahead of that, because I believe in it as much as the customers do. We need to reexamine shipping solutions to address the two most impactful industry issues today – insufficient labor pools and the reduction of CO2 emissions.”

Source: freightwaves

Overinvestment in load matching technologies isn’t solving deeper transportation issues