The transport industry has never before been as exciting and undergone so much change as it is experiencing today. An entire range of developments are in the process of fundamentally changing our world and the world of our industry and how we co-exist with one another. And just as with any other major change, this leaves us in a situation where we face both difficult challenges and get huge opportunities.
What am I referring to? Three important transformation drivers which each of us encounter every day. Firstly, something that won’t come as a great surprise to you: Transport volumes are increasing. Both nationally and globally! Estimates supplied by the Ministry of Transport predict that for Germany alone high double-digit growth in the sector will continue for the next 10-12 years. And the overwhelming majority of all goods are, as we know, transported by truck. Particularly in areas near large cities and conurbations, the transport sector is continuing to expand dramatically.
E-commerce has made it possible for increasing numbers of products to be delivered directly to the consumer’s home at ever decreasing delivery times. International trade between countries is booming and the global flow of goods has reached levels we would have believed inconceivable just a few years ago.
Last year more goods were transported than ever before, and around 70% of these were transported on the road. Just for fun, I decided to perform a few calculations: If all of the heavy trucks sold worldwide in the last year were parked in a line: This line of new vehicles would easily cover the globe’s circumference.
This mega trend is set to continue, even in spite of all potential tariff barriers. As we all know: The free exchange of goods when competing at a global level is a, maybe even the, key source of our prosperity. Protectionism, on the other hand, only creates losers. This growth in the flow of goods naturally presents us with challenges.
How should we continue to successfully transport enormous volumes on the roads? In many cities traffic density has already reached its absolute limit and on large arterial roads we are certainly seeing more stop than go. Last year the ADAC registered 1.5 million kilometres of traffic congestion in Germany alone. Or, taking our metaphor further: That’s nearly 40 times the earth’s circumference.
This shows that we need new logistics concepts, and we need these now. We also need huge investment in infrastructure, which, in its current state, has seen better days.
Secondly, our society is changing – not only demographically, but also people’s value systems are changing. And consequently, so are the demands of our customers. Today we all are striving to find clean and sustainable solutions. The disadvantages of extensive road traffic are no longer accepted.
Climate change and its consequences, which can now be felt by us all, have created a new awareness of resource management and require us to adapt a radically new way of thinking. Whether this be in the area of CO2 emissions, nitrogen oxide levels (NOx), or considering the sustainability of the energy sources we choose.
This aspect especially is another responsibility of all stakeholders in the road transport industry. The fact speaks for itself: The top ten warmest years in history since weather records began were exclusively years that came after 2000. This does not mean that road transport alone is to blame – however, in producing 25% of all CO2 emissions in the EU, it is a significant contributor to global warming. Road freight transport accounts for around 6% of emissions in Europe.
In this regard, time is of the essence, particularly given the fact that approximately one in three trucks is still driving on the roads without any cargo, at least statistically.
And thirdly, of course, there is digitalisation. This has opened up previously undreamt-of possibilities. Intelligent networking not only of vehicle units, but also of products, flows of goods and all logistics partners in the transport chain is allowing us to unlock entirely new capabilities in many areas. That is at least the theory, we’ve already been aware of this for a few years now.
But the real progress of digital technologies is already allowing us to take several leaps forward in technological development at a time. Just think of autonomously-driven vehicles, interconnected fleets that are capable of optimally calculating routes and cargo loads in real time.
With direct links to upstream and downstream processes in the logistics chain vehicles which use the help of network integration to perform maintenance work before the problem occurs. All of this already exists!
When we talk about change in our sector, we are not simply speaking about a new powertrain here, or a modified cabin there. We are also talking about how we, the transport industry, as a crucial component of our economy, want to help shape possibly the greatest transformation in its history.
How we re-think all together the transportation ecosystem. And I am convinced: We should proceed on this path with determination!
There is a saying that is old but true: Those who do not change anything will be changed. Therefore, it is about time we had a paradigm shift in the transport sector! And I hope that we do not just accept this change but embrace it and see it as an opportunity. That we drive it forward actively. Together. As OEM, as association, as partners.
The mobility of people and goods is integral to our social and economic progress. Transport is and remains the lifeline which holds everything together. What could the solutions to these challenges be? Working on this eco-system is what goes way beyond the former definition of a commercial vehicle supplier.
– Providing digital logistics platforms to consolidate flows of goods and thus create less traffic – lower costs – fewer congested roads.
– Letting trucks operate autonomously or semi-autonomously and thus reducing the driver’s workload whilst better utilising our vehicles and operating hours.
– Letting trucks drive in convoy as a platoon, like in the pilot project on the A9 in Bavaria, and thus considerably reducing fuel consumption and CO2 emissions whilst providing a notably higher level of safety.
– Working on alternative drive systems. And by no means does this just include e-mobility. Certainly, battery-operated vehicles will become extremely important in road transport. However, if after just two days of driving long distances an e-truck consumes more electricity than the average household consumes in a year, we see there are clear limitations.
In the heavy load sector and on long-distance routes in particular we will see very few e-trucks on the roads in the long run. This is purely due to technical reasons. On this issue I am sure you are being just as realistic as I am. Instead we are seeing the use of e-vehicles in increasingly heavy urban delivery traffic and, of course, e-vehicle city buses.
Thus, we would do well to think laterally and remain openminded towards innovative solutions. The changes we face are too large and too complex for us to expect a new one size-fits-all approach as was the case up until now with diesel fuel vehicles.
Currently we also regard the opportunities that the so-called e-fuels can bring as very exciting. These are gaseous or liquid fuels which were generated on the basis of renewable energies. In terms of both availability and political support for the idea, we are not yet where we want to be and, in my view, need to be. Nevertheless, this is an area that is worth observing more closely.
I am proud of our industry. In the past, time and again we have successfully adapted to new demands we have faced. As we know, the sustained success of the road transport industry is no coincidence. If we therefore set to work with resolve, trust, reliability and in a team that includes all stakeholders, we will use the revolutionary changes we are witnessing today to achieve a real paradigm shift in the transport industry. And in doing so we will gain much more than if we continued as before.
Speech delivered by Andreas Renschler, Member of the Board of Management, Volkswagen AG, and CEO, Volkswagen Truck & Bus, at the VDA International Press Workshop in Frankfurt