By Cate Hull
Technology’s advance into container shipping is changing the freight and logistics industry.
History tells us that companies that embrace new technologies and apply them wisely in their business tend to prosper.
This new technology, in the form of autonomous ships, blockchain supply chains, cloud computing and automated short haul drayage truck traffic, is designed to make freight and logistics more efficient and cost effective in the future.
In our experience, we have seen four key reasons to welcome new technology in container shipping:
Transparency – Newer technologies enhance transparency and predictability by allowing users to track a shipment at any given time. Shippers can use real-time data to better manage the shipping process.
Security – With cloud computing and more sophisticated data systems, shipping, possession, and ownership information could be better shielded from tampering and hacks.
Reduction of errors and delays – Automated supply chain management could reduce errors, delays, and fraud, improve inventory management, and identify and resolve issues faster. Beneficiaries would be sellers, intermediaries, and consumers.
Bottom line savings – With the new technologies, sellers will be able to better track costs and capacity, better estimate delivery times for multiple routes, and make more intelligent decisions. Consumers will be able to better track their orders.
Companies such as Factom, IBM and Skuchain are early trendsetters in applying blockchain technology to supply chain management. UPS and FedEx are privately testing blockchain logistics as well.
At June’s Marine Money Week Conference in New York, there was a greater emphasis on software than in previous years. The conference is no longer just about financing ships, but about financing ship tech as well, according to Greg Miller, senior editor for FreightWaves.
“There have been momentous technology disruptions in this industry before – sail to steam, the chronometer, the container, GPS – and now it’s our turn with software and the internet,” Scott Borgerson, co-founder, and chief executive officer (CEO) of CargoMetrics Technologies, told FreightWaves.
“Machine learning, cloud computing, Big Data, AWS [Amazon Web Services] – a lot of that stuff didn’t exist 10 years ago, but now it’s mature enough that shipping is ready to embrace change and optimization,” he said.
“Angel capital and venture capital is starting to wake up to the fact that shipping is about more than just containers. It’s an exciting moment for us in our field.”
More and more, IoT solutions for sea-land fleets are bringing new tech to the industry.
Earlier this month, French firm Traxens equipped Indonesian ships with a set of devices with sensors and GPS that track geolocation, detect shock and motion, and check temperature, humidity, and provide alarms on refrigerated containers.
Traxens expects to have more than 100,000 “smart container” units deployed by the end of 2020. Shipping giant Maersk became a shareholder and ordered 50,000 units in June.
According to a report by management consulting firm McKinsey & Company, location-tracking IoT technology could reduce ships’ navigation time by 11 to 13 percent.
IoT technology that tracks packages and containers could also reduce the number of damaged goods by 30 to 50 percent and increase the utilization of containers by 10 to 25 percent. And if companies are better able to track the status and contents of their containers, they could reduce the amount they spend annually on containers by US $13 billion.
Rolls-Royce Marine and Japanese shipping giant Nippon Yusen are developing autonomous ships with built-in sensor arrays that analyze their surroundings. Satellite data links will let operators communicate with and control vessels across the globe.
Transparency, security, reduction of errors, bottom line savings – four sound reasons why the embrace of new technology in the container shipping industry will pay dividends.
Cate Hull is the CEO of FreightExchange, a freight and logistics company based in Sydney.