Evolving Urban Logistics

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Source: European Institute for Sustainable Transport

Logistics may be the life-blood of cities yet burdens urban areas with high pollution levels, congestion and noise. With new technology and changing shopping patterns, the industry has a chance to be re-invented. How can urban logistics change in the 21st Century and where are the opportunities for users and businesses alike?

An urban myth has it that the typical urban supermarket would be bare within a few days of typical shopping if they could not be restocked. Welcome to urban logistics – the un-sexy topic that slides under our noses but keeps cities alive. Logistics may be the life-blood of cities but it consumes some20% of energy for motorized traffic, results in 20-30% of PM pollution and is responsible for a large percentage of urban noise pollution. It also employs some 2.5% (in cities like London) while it is worth around 3% of the EU economy. If we are talking about sustainability, or reducing energy demands, or moving to renewable energy,  or local economies, or just making cities more attractive, then we really must get our heads around urban logistics.

We have never before been so dependent on worldwide flows of goods. The challenge for most is that we are simply not aware of how urban logistics relates to cities. While cities have always been founded on trade and movement of goods, urban logistics remains a mystery even to public authorities and urban planners as much of it involves loosely  egulated and highly protected private businesses. Urban logistics really is the beginning and end in a much larger story of consumption of goods, production, jobs and the construct of urban society at large.

Urban logistics is beginning toevolve with new technology, ‘hacks’ to the system and innovative planning. This is certainly offering an improvement to our lives as changes in urban logistics reduces wasted travel time, can deliver more efficiently (reduces cost of the item) and through technology minimize the existing environmental impacts of transports. We will look at a few relevant themes of how logistics may be changing and some interesting innovation areas to keep an eye out for. We’ll end by looking at the cause and effect of things moving around the city and between cities.

Transportation

Transport is one of the most obvious Points for tech-innovation as it is simply a change in vehicle, while the delivery itself remains conventional.

  • Modes

Transport modes can make a difference to logistics. Where innovation remains to be explored is how each of these modes forms a multi-modal network so each mode works most efficiently according to its Environment.

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London Low Emission Signage. Source: European Institute for Sustainable Transport.

Truck/Van: The conventional mode for most transport of goods. It is flexible but highly polluting due to diesel, not energy efficient, creates traffic, can get stuck in congestion and so on.

Inland Water: A slow but energy efficient way of moving heavy goods, very impractical however boats are seen as possible moving distribution hubs for urban logistics. While cities like Venice, Amsterdam and Tenochtitlan were built on water-based cargo, the most efficient pre-motorized mode, it rarely features in contemporary urban logistics. Utrecht’s electric barge called the ‘Bierboot’ services bars along the Canal but it provides a fraction of the innercity’s logistics.

Rail: A very energy efficient but poorly used mode for goods transport due to inflexibility of the network. Cargo trams have been explored in Amsterdam, Dresden (CarGoTram for the Volkswagen factory) and Zurich (Cargo- und E-Tram) but with relatively little success. This is possibly due to poor integration with other modes such as with bikes.

Other: Drones that can deliver a book within minutes (Amazon) and automatic cars (Uber, Google and others) are on the horizon but in practice could face a decade of technical and legislative hurdles before and if getting a green-light.

  • Transmission

One significant change emerging is in fuel – there is little to match the convenience of fossil fuels.  Conventional fossil fuel technology is reaching its efficiency capacity in terms of emissions and energy consumption while other modes are not offering either the range or power to match. Cities are beginning to institutionalize ‘Low Emissions Zones’ (LEZ), areas where heavy diesel based vehicles cannot enter and both large (London, UK) and small cities (Piemonte, IT) are institutionalizing them quickly. More information here.

Conventional: Diesel based trucks and vans are currently the norm but haunted by the recent emissions scandals.

Biofuels: Biogas and diesel are an attractive alternative to fossil fuels however remain a scandalous fuel due to competition with food. Second generation biofuels may solve this problem but need development.

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Electric Powered Truck, Siemens, Germany. Source: Scania / Dan Boman.

Electric: Trains, trams and increasingly cars, small trucks and bikes are currently limited by battery size but as vehicle COSTs come down and fuel costs are assumed to go up, they are becoming increasingly attractive. The high side is that they are very quiet and have no local emissions.

Hydrogen: Fuel cell technology are oriented to boats and trucks as it is much more powerful than electric. However, hydrogen remains far less efficient than diesel/petrol so extra fuel or shorter range can be a concern.

Other: Hybrid has been around for some time but hybrid electric and biofuels/hydrogen may be an interesting low emissions long-distance alternative. Compressed air technology has been around for a century and now Honda and Peugeot have shown signs of moving in this direction.

  • Vehicle size

Vehicle size is often limited by road size and companies often prefer larger vehicles to reduce trips but this may be changing due to cost.

Large: Big trucks, trains, and boats that bring things in bulk often service outer urban areas likely will turn to biofuels and hydrogen as diesel alternatives. Inter-urban electric trolley-trucks have been explored by Siemens.

Medium: Transport that can bring large amounts of stuff but can also negotiate small urban streets and chaotic traffic conditions. Electric and biofuels may be the most attractive new energy future.

Small: Great things in small packages: increasingly online shopping is requiring greater attention, particularly for last-mile delivery. Consider the Cargo Hopper (NL) that shifts goods into smaller electric vehicles for inner urban distribution within Utrecht and Amsterdam. Freight by bike is increasingly common too – a mode that can escape congestion or LEZs.

  • Depot

Warehouses have always been located closest to transport. In the past, this was located in the inner city, which over the last few decades have turned into lofts and office space. This has meant the inner city areas rarely have decent sized and accessible spaces for storage and distribution. Therefore, there is no other solution but using large and noisy trucks to transport goods from the edge of the city to the center. The question now is how to adjust smaller scale depots closer to where people live.

Fringe warehouses: Large distributed warehouse space located on urban fringes where land is cheap and Close to freeways: the generic solution. The problem here is this model creates a lot of traffic.

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Cargo Tram, Zurich. Source: Sven Dowideit.

Centralized inner-city: A possible solution focused on an inner-city distribution hub. There have been a few case studies to do this based on public private partnerships, however financing and systemic change have  not given them a chance to become viable solutions.

Distributed inner-city: Containing larger numbers of smaller drop-off Points. This would involve private storage spaces now explored by Sugaris in Beaugrenelle and Chapelle in Paris.

  • Users

Something strikingly new is how we shop and how shopping arrives to us. Online shopping is allowing us to avoid wasting time and distractions in shops. But by online shopping we’re increasingly distancing ours from contact with producers, growers and the source of the materials we’re acquiring.

Ordering – Online shopping is nothing new and the market with stable growth – except it is not necessarily a replacement for the experience of bricks and mortar shopping.

Conventional: Buying things from traditional shops has not ended, as many forecasted but is becoming more experience and service driven.

Shopping online: The rise of online shopping has been dramatic and is very likely to continue rising; in the U.S. e-commerce accounts for over 7% of retail trade and is growing.

Hybrid: We have not lost the glamour and leisure experience of shopping. The cost of retail space is forcing some companies to treat their floorspace simply as a show-room with actual shopping occurring online. Many shops (particularly technology showrooms such as Apple) create a different retail experience online at the same price. This is an area that retailers are coming to grips with and is feeding marketing agencies attempting to connect physical and online Environments.

  • Delivery

All delivery systems are enjoying the benefits of computed ITS systems, tracking and GPS technology which is helping find the shortest and most effective route. But beyond this the actual delivery mode is evolving.

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Electric vehicle in Utrecht. Source: Cargohopper.

Conventional: Conventional postal or courier style delivery services may be and remain a staple.

Centralized: Postal companies are beginning to offer deliveries at central points where users pass regularly. This skips the need to actually deliver to individuals but rather to deliver to a box. BPost in Belgium has 24-hour post-boxes at major stations.

Organized: Disruptive app-based platforms such as UberRUSH are introducing a service combining that of a courier and a butler.

Hitch-hiking: An area to explore is the use of typical drivers to pick-up and drop-off goods on routes they would be travelling – an informal variation of Uber. This is hitch-hiking for small goods.

Social Impacts

Urban logistics offers mixed blessings on a social dimension. On the one hand it brings is vast amounts of stuff such as technology, manufactured goods, exotic food and so on, but on the other hand we suffer the consequences of noise, polluting particulate matter, congestion, accidents and so on. Is technology actually going to improve conditions? Superficially yes it will.

We have been losing the concept of where things come from, how to make things and the consequences of moving things around. Since the Second World War, the West has slowly shifted industrial jobs out of cities. Western cities now make relatively little of what they consume. Our H+M shirts once made in China are now made in Bangladesh – but who cares? While post-industrial economies may see manufacturing as a dirty job, one of the consequences of logistics is a loss of the cross-section of skills and the poor employment conditions for those countries that actually make stuff. In many European cities, this has meant that lower-skilled jobs are reduced to lorry drivers and cleaners. Only now, as economies begin to readjust, and unemployment rises in some areas, do we need to blame the convenience of logistics?

Interestingly in the last couple of years, with the reduction in capital and the need for local innovation, small-scale urban entrepreneurs are looking at local low-cost and low capital business models. We are seeing a rise in local manufacturing and slower forms of urban distribution (such as cargo bikes) to match. As a result, Young start-ups with poor funds choose lower cost and lower impact forms of urban logistics, such as cargo bikes.

The Economic Dimension

Urban logistics is creating a fissure in urban areas. The economics of congestion, pollution, consumption of space, cost of infrastructure (such as roads), noise and so on are becoming increasingly clear and paid for out of all of our pockets. Technically, urban logistics has much to gain by moving into smaller, lighter and more localized distribution systems. A major system overhaul is required. More importantly, we must carefully consider the local consequences of carelessly moving stuff around the city and from city to city. As ordering things online becomes more of the norm, we are becoming entirely desensitized by where things come from and we are losing the value and meaning of personal contact.

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Local Production & Different Logistics. Source: Permafungi.

It is clear that post-crisis, post-growth Europe will need to be much craftier about the use of resources. We don’t need economic activity by simply Selling more stuff manufactured in foreign lands. We need better locally-produced and useful products. Likewise, new automated 3D manufacturing technology will see a rise in local production. The access-based and sharing economy is becoming not only increasingly attractive but the most viable solution for having things when they are needed. Moves to value resources, such as the circular economy and short-Circuit food production, will need to be underlined by urban logistics to reprocess ‘waste’. In short: access to goods, local production and resource valuation is an area requiring reliable logistics and a great opportunityfor business growth.

Urban logistics is exciting terrain for innovation and development. The electrified21st century city is beginning to create great new options for urban areas which will require an entire re-think of how things get around the city. This ranges from vehicles, to distribution networks and shopping conditions. The challenge is not to find more effective ways to move more things around, but to get most value out of the things that we do distribute within urban areas while having the lowest possible impact on inhabitants.


Writer: Adrian Vickery Hill


Featured in Issue #18 of Revolve Magazine (Winter 2015) on pages 10-17

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