Dive Brief:
- In one to three years, cities will be "severely challenged" by e-commerce-driven delivery traffic, but existing technology and policy fixes can help quell the resulting carbon emissions and congestion if implemented quickly, according to a report from the World Economic Forum (WEF) with input from DHL, Llamasoft, McKinsey, Uber Freight, Unilever, UPS and Walmart among others, released Jan. 10.
- The study analyzed 24 last-mile technologies including drones, robots and unmanned deliveries, drop boxes, locker systems and other ways of consolidating orders, along with non-tech changes including increased double-parking enforcement, delivery time shifts, traffic light interventions and road lane changes.
- The best scenario, according to WEF, is one that takes into account the carriers' interest in fewer disruptions and faster deliveries alongside cities' desire for lower emissions and less congestion. This combined scenario would include electric vehicles, night deliveries, multi-brand parcel lockers, dynamic re-routing and load pooling. These interventions could reduce emissions by 35%, unit costs by 15% and congestion by 25%, according to the report.
Dive Insight:
Urban last-mile deliveries will increase 78% by 2030, according to the report.
The WEF argues that since carriers and municipalities have different, sometimes competitive priorities, the best path forward is to build portfolios of solutions that, combined, improve congestion and reduce emissions while also decreasing unit cost of deliveries.
For the fastest and most impactful results, the WEF advocates a collaborative approach involving major carriers and cities, with competing carriers working together to consolidate the last mile rather than leaning on third parties to orchestrate this consolidation.
"While multi-brand solutions come with the need to collaborate with competitors and to give up certain privileges, they might still be less costly than waiting for last-mile start-ups to disrupt the last mile and launch convenient, local delivery solutions," reads the report.
The four key suggested interventions are available today, apart from night deliveries, which could be implemented in the next one to three years with private-public collaboration, according to WEF.
"Last-mile challenge is so big and unique in nature that it requires closer collaboration of all ecosystem partners to produce beneficial results for every stakeholder, but also distributing the burden on to multiple shoulders that might come with certain effective solutions, " wrote the report authors.
