Mobility innovation will help meet the e-commerce challenge

Alternatives to doorstep delivery, whether at home or work, are already available to package recipients today. Recent years have seen the rise of on-street lockers, such as Amazon’s; the e-commerce giant first launched the service in New York in 2011, and now has over 3,000 locations across the US. The company has also rolled out an in-car delivery service, compatible with certain Audi, GM and Volvo models. Available in major cities to its Amazon Prime premium subscription members, the service allows couriers to temporarily access the trunks of parked cars during a delivery window. The latter demonstrates how connectivity is creating new last-mile delivery solutions, but with private vehicle use in cities set to become increasingly difficult, it is clear that a variety of solutions will be needed to cope with the continuing boom in e-commerce. A study by DPDgroup identified 57% of the European population as e-shoppers, and the delivery company predicts that by 2025, nearly 15 billion parcels will be delivered a year. Most of these will be for city-based recipients, where over 73% of Europe’s population currently lives. By the time 2025 comes around, this percentage will be higher. Thomas Steverding is the Senior Group Manager, Process & Development, at DPD Germany, and also in charge of DPDgroup’s autonomous vehicles innovation programme. Moving forward, he sees two important areas of development for the delivery giant should it wish to remain competitive in the last mile delivery segment. The first is DPD store pick-up. Already an option today, Steverding suggests that the addition of value-added services could make it just as attractive as home-delivery. DPD would not have worked with Renault if it didn’t believe in self-driving technology “For example, a customer could try on their new clothes on-site,” he says. “Should they not fit, they could pack and send returns from the shop directly.” Importantly, an improved in-store pick up could slash the number of courier journeys required of delivery companies, so much so that competing players are now working together: following a year-long pilot, a pick-up shop in Hamburg allows customers of DPD, UPS, Hermes and GLS to all collect their packages. Out on the street, Steverding also predicts a sizeable role for mobile delivery lockers. These, he says, will prove diverse in the way they operate. Some customers will opt to receive a push notification on their phones, notifying them that the locker will be on a nearby street at such a time. These are customers who need a certain amount of flexibility, but can still sync the pick-up into their daily routine. DPD will also need to analyse where the lockers might stop: busy train stations, suggests Steverding, are a potential example. “The second option puts people in the driving seat,” he explains. “These customers will pay a premium to call a mobile parcel locker to their location. This is a possible scenario that we foresee arriving in future.” The future of the fleet A key enabler for this on-demand service could be autonomous driving. As unveiled in September, DPD has collaborated with Renault on a self-driving delivery vehicle concept with mobile lockers for customers. The EZ-PRO is a robo-pod designed to work in groups, with one piloted by a driver and the remaining pods driverless. The main issue has been that up until today, traditional truck-makers were unable to offer models for our industry Just how realistic does DPD believe the concept is? “DPD would not have worked with Renault if it didn’t believe in the technology,” Steverding asserts, but concedes it will be some time before self-driving delivery arrives on the road. The two obstacles he points to are regulation and connected infrastructure outside of cities. The former in particular raises concerns, as different pictures are emerging in different locations. “Where regulation is concerned, Europe needs to speed things up with a region-wide solution,” he says. “Different countries are working at different paces, and with different focuses. There is little combined activity in Europe to reach certain standards.” However, just as important as self-driving capabilities is the EZ-PRO’s powertrain. Fully electrified, it could sidestep any incoming bans on gasoline and diesel engines. But whereas it is generally agreed that full autonomy remains some years out, the question of cutting urban emissions is very much a contemporary topic. Fleets need to address the emissions in vehicles running today, and not in tomorrow’s concepts. Truck-makers play catch up Several European cities have made clear their ambitions to rid their streets of internal combustion engines, and some have already introduced low-emissions zones. With the e-commerce boom set to increase the amount of city-bound deliveries, how are fleets reacting? DPD, says Steverding, is already heavily engaged with the issue, but there are challenges ahead. One solution which the company and others are turning to is increased use of cargo bikes in urban areas. For now, however, bike manufacturers and aftersales service providers still lack the means to roll out a reliable nation-wide service, he says, and sizeable development and investment is required. What’s more, bike loads remain limited, and vans will still be required to deal with the increasing volumes of deliveries. The problem is, the big manufacturers have been slow to meet this demand. It is a complaint echoed through the delivery sector: DHL famously found the manufacturers so lacking, it designed and built its own electrified van which is now manufactured at multiple sites run by its StreetScooter subsidiary. Micro-depots require space, which is quite limited within the inner cities. That’s why we need their support “The main issue has been that up until today, traditional truck makers were unable to offer models for our industry,” he says. This is beginning to change with the emergence of electric vans from the likes of VW, Renault and others, he says. However, he points out, electric vehicle design means that limitations still exist. The problem is that whereas the vans used today will, on average, have a size of around 15 to 17 cubic metres, these vehicles are smaller, at around 10.6 cubic meters. “It is true that greater amounts of to-customer delivery mean that packages and parcels will get smaller on average,” he adds, “but it is still something which hinders a positive buy-in on the part of our subcontractors, because they fear that they won’t be able to offer all of the services they do today.” The next few years could see a tipping point, however: the Hannover IAA 2018 was notably packed with electrified offerings. Charging points Increased micro-depots in urban locations could help delivery companies embrace further electrification whilst meeting increased demand. In October 2018, DPD opened its first all-electric last-mile delivery depot in London. Handling 2,000 packages a day, it is the first of eight spots planned for the UK capital, and houses charging infrastructure for its diverse fleet of electric vehicles. These include two 7.5 tonne Mitsubishi Fuso eCanters, seven Nissan eNV200 vans, and eight buggy-like single-seat Paxster vehicles. Some customers will pay a premium to call a mobile parcel locker to their location. This is a possible scenario that we foresee arriving in future Steverding says micro-depots are a proven solution, as the demands on electric vehicles running back and forth between major distribution centres and cities may prove too much: such centres are often up to 30km away from their target cities. That said, building more will prove challenging. The cost of land in cities can be prohibitive, and then there is the balancing act of keeping local authorities happy. “Micro-depots require space, which is quite limited within the inner cities. That’s why we need their support,” he concludes. “In general, the authorities should take the needs of logistics and parcel service providers far more into account.” Cities that choose to help out may not regret it, as it could bring in more of the electrified solutions so keenly anticipated. This article was featured in our November 2018 special report, ‘The future of last mile delivery’, which is now available for download

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