The future of transport

BY DIANE EDWARDS

In today’s article, I am going to discuss something that is perhaps a little controversial – the possibility that supply chain logistics may be severely disrupted by developments in additive manufacturing (known popularly as 3-D printing) and changing socio-economic factors over the next 20 years. Most supply chain experts use sociological data to extrapolate volume growth and trade routes based on economic modelling grounded in current paradigms – more people mean more freight movements; higher incomes will mean more demand for goods. This type of research and projection has served us well in the past, but with the world changing so rapidly, can we be sure it will serve us well in the future?

In this article I will explore how additive manufacturing could, in the not-too-distant future, slash the number of containers circulating the globe; and how changing consumer patterns will further reduce demand for goods. This is a different view than that being discussed currently by ports and shipping lines. So why this contrary view? Several years ago, I was speaking at a shipping conference in Singapore, when they were proudly announcing plans for Tuas Megaport, a terminal destined to add 20M TEU capacity by 2021 and a planned 65M TEU in total when completed in 2040. This would mean that by 2040 Singapore would have more than doubled its 2015 capacity of 50M TEU. I grew more and more nervous as the speaker proudly described Singapore’s reliance on automation, advanced traffic management systems and tight processes to reduce dwell times. Imagine the hush in the room when I got up to speak as the presenter providing a different perspective. My brief was to argue that all that capacity may not be needed by the planned 2040 completion date. So, I explained that by 2040 we might be looking at a very different world, where 3-D printing changes the way that people consume goods. So why do I think that might be the way of the future? Way back in 2010, I attended my first World Future Society conference where I saw my first 3-D printer, churning out plastic likenesses of all the delegates. Pioneered in the 1970s, by 2010 3-D printing was starting to emerge as a promising manufacturing tool. Yet it remained a specialist technology with a high price tag. The speaker proudly announced that by 2035 he expected 3-D printers to come down in price and perhaps even be available for everyone with a reasonable income to buy. As with many revolutionary technology predictions, he was only partially right. Yes, they have indeed come down in price but no, it didn’t take 25 years for them to be found in shops for everyone to buy. By 2020 additive manufacturing was being used to make a vast variety of things from components for TVs to artificial eyes. Today, you can buy a 3-D printer for less than NZ$500 – it has come of age. What has this all got to do with logistics and transport? As a foresight practitioner, I look at the trajectory of this technology and ask “where might this go next?”. What, for example, if in a few years, we all have access to a 3-D printer? We could design or download files to print our own uniforms, dial up the printing specs for the spare parts we need for our trucks and trailers, make chairs, and yes, even print the office building. And it is not just companies, anyone can create their own fashion, print any item of home décor, and they no longer have to go searching for spare parts for the broken dishwasher. If access to consumer goods becomes so easy, why would anyone bother to order anything from overseas? There is no longer any need to import goods, we can simply make our own at home, or perhaps in a shared facility in each street or village. The impact on containerised shipping is now obvious – the volume of goods being transported long distances drops dramatically. There would probably still be things that we may continue to transport, perhaps premium products or foods which are more difficult to replicate (though many of these are already being made artificially). I’m suggesting that the golden age of containerisation may be at its peak now and will soon decline sharply. Not all cargo may be impacted. We’re not yet at the stage where we can break things down at the molecular level, turning one material into another. This means 3-D printers still need bulk materials to construct their output, so bulk cargo shipments would continue for the foreseeable future – maybe even increasing. Alongside this technology, socio-economic trends are also suggesting that GDP may be an outmoded way of assessing growth and success. Socio-economists are noting many trends that signal people are rebelling against materialism. Here are just a few. Rising consciousness of climate change and global warming means people are questioning whether they need to fill their lives with material goods or increase carbon emissions by transporting goods around the globe. The Shared Economy, already popular among the young (remember it is they who will inherit the world we are creating today) exhibits behaviour that reduces the need for goods. Rather than buying a car, people carpool or use rides on demand, such as Uber. Perhaps a manifestation of this attitude of shunning material goods can be seen in the tiny house phenomenon. The dream of the quarter acre section is being replaced by some (not all, I admit) who are more than happy to live in a home less than 35m2. Another significant cultural shift is the move to the Experience Economy, which Libby Margo1 says “has changed the way we consume, influencing us to prioritise experience over the ownership of goods”. The Experience Economy recognises that as the perceived value of goods start to diminish, people will start to place more emphasis on the experiences they have. 3D printing had the potential to drive all these trends just because it makes goods more accessible. The resulting overabundance of goods as basic economics tells us, will mean supply will start to outstrip demand, and the value placed on goods will fall. If the reason for the glut of goods does not go away, demand for goods will fall to the point where global trade is disrupted. None of these trends also would be sufficient signal a collapse in freight movements on its own, but when you start looking, there are numerous more signals pointing in the same direction. This means that despite population growth, the next twenty years might actually see a significant decline in freight volumes, particularly containers. Not the mainstream view, I know but one that I believe should not be ignored.

Diane Edwards Diane is an experienced executive, change agent and business transformation facilitator, enabling organisations to prepare for the future of work through practical initiatives to transform the business to be agile, resilient and innovative.