With every new technology there have been predictions of gloom and doom to one sector of industry or another. Luddites rioted against threshing machines in the 1800’s, and weavers went broke with the steam powered loom. Moving to the 2000’s, a new technology has been heralded that experts suggest could seriously impact the global logistics industry – the 3D printer.
Global industrial strategy consultants Strategy& published a report this month looking at the effect that 3D printing could have in the coming years on the global logistics sectors. Road haulage gets off relatively lightly with a 25% loss of business, but air freight and sea freight could really get a kicking, with 41% of air cargo business and 37% of sea cargo business disappearing.
What is 3D printing?
3D printing is a system where products are built using extruded material by a computer. You may have seen news of a company releasing blueprints to make a pistol, but literally millions of every day products can be made using this system. From shoes to jet fuel nozzles, 3D printing is enabling companies to manufacture products in house without resorting to full blown factories to make them.
This will impact manufacturing as the new technology wipes out the need for many components to be made using traditional workforces and machinery. Why pay for a Chinese company to make something when you can make it in-house cheaper and get it faster? Not only do you cut out wage bills, you cut the need for them to be transported thousands of miles across the globe.
What does this means for road haulage?
The impact across the industry will be very much dependent on what your current customers are transporting. Some sectors will be adversely affected, while it might provide growth and opportunity for others. Overall the report suggests in the medium term that there will be a contraction in business.
In the UK, as demand for hauliers outstrips supply simply because there aren’t enough drivers this fall in business will be buffered as the market finds a new equilibrium
Who are the winners and losers?
- Businesses moving goods from ports and airports to warehouses will see a significant drop in business, and some firms will be wiped out. Container deliveries will plummet.
- Deliveries to the continent will be impacted as so much will be made locally.
The stay the samers:
- Farm transport – taking animals to market for example – will remain the same.
- Retail deliveries will remain the same, depending on the market.
- Luxury goods deliveries. Though you may one day be able to print your own electric car, you will never print your own Porsche or Bang & Olufsen sound system!
- Courier businesses may see no change at all. However, there is a chance it will provide a further boost to their businesses as companies and consumers order more items from within the domestic market.
- There will be a need for raw materials to be delivered to new ‘factory / warehouses’. Raw materials supplies will boom, with the same need for raw materials as present being added to by extra manufacturing.
- Warehousing companies may well be the outright winners. With the ability of 3D printing to make a range of goods, designs will be sent from the client company to the warehouse, which will make the goods on demand. One can imagine a world where Amazon manufactures a large proportion of its goods as soon as they are ordered online, before dispatching them to customers while still warm!
Sleep well tonight…
Where the change in the landscape could impact some parts of the supply chain, others may remain unchanged. Goods will still need to be moved from warehouses to retail centres in HGV’s. Courier companies will see positive growth, at least until 3D printers mean you can print your own iPad at home! High value goods such as Bang & Olufsen sound systems and kitchen appliances will need to be moved from A-B.
Futurologists have a role to play in society insofar as they look at technologies and surmise how they can be used. 3D printing is exciting and could change the world’s economy forever. Importantly, the report that projects such doom and gloom for the logistics sector doesn’t try to guess a date by which HGV’s will rust in the yard.
Overall, this is an interesting suggestion as to how the world will change. Take note of it, and look to diversify your business to cushion any decline in demand. Haulage companies are renowned for their resilience, and though the future could see reduced demand, the end is certainly not nigh for hauliers!