Will Uber In Trucking Really Work?
Admit it.
If you’re in the trucking industry, you’ve wondered if the Uber concept could really work.
On the surface, you might simply think that if an app can connect a “taxi” driver with a passenger, then why couldn’t it connect a company needing freight to be moved with a professional trucker. Frost & Sullivan think mobile-based freight brokering may actually eliminate some of the inefficiencies in trucking.
Uber based trucking could mean less time sitting and waiting. It could mean huge savings on fuel. It could mean less money tied up in personnel and overhead. There are a lot of things that an Uber type model in trucking COULD mean…
So, What’s Missing?
With all of the benefits discussed above, you may be wondering what the downsides to a mobile-based freight brokering world might be. It all comes down to one word…relationships.
Trucking is an industry that works best when relationships are made. Relationships between the shipper and receiver, but most importantly – relationships with the transportation company hauling the freight. Having a different driver hauling your freight day in and day out means a loss in control. Trucking is all about logistics and losing what little consistency there is could be a bad thing.
Let’s use a dedicated lane for example. If there’s 1-2 drivers running a certain route week in and week out, those drivers build relationships with the customers. They begin to learn the traffic patterns involved in the route, growing more efficient over time. Fleet Managers are able to create a relationship with those drivers and determine who is able to run the lane best for the customer.
Startups Getting On Board
Startups are popping up to help develop the app that would allow this Uber-fied trucking world to exist. Silicon Valley’s currently has a growing interest in the technology that would make this all happen. San Francisco-based Trucker Path Inc. says it is aiming to reach a $1 billion valuation this year. The latest entrant, Seattle-based Convoy, said Tuesday it had raised $2.5 million in seed funding from investors including Amazon.com Inc. founder Jeff Bezos, Salesforce.com Inc. founder Marc Benioff, eBay Inc. founder Pierre Omidyar and Uber Technologies Inc. co-founder Garrett Camp.
The competition is heating up and it’s going to be interesting to see which company figures it all out first, and best. Though there are still plenty who don’t think it’s going to be fully adopted. Jack Atkins, a transportation analyst with investment bank Stephens Inc. said, “Truckers are very reticent to adopt the technological options that are out there,” said “There are a lot of moving pieces, and I don’t see an app from a non-industry player—just given the complexities of the truckload market—really coming in and having a disruptive impact.”
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* Photo from TruckerPath.com
