LogTech Q3 2016: Rise Of The Tech Giants

The Freightos’ LogTech report is a free quarterly report focusing on major logistics technology updates in the sector. 


Amazon. Uber. Google. Alibaba.

Together, the four tech powerhouses boast a market cap (including Uber’s private valuation) of about $1.29 trillion dollars. And they’re coming for logistics.

Logistics technology has traditionally come from technology companies, often foisted on logistics companies not yet culturally prepared to assimilate technology. Now, it seems that some of those technology companies are cutting out the middleman and becoming logistics companies themselves.

Take Uber.

Sources report that Uber is already talking about offering full-fledged long-haul trucking to US companies, advancing well beyond it’s nascent trucking food delivery business. To be fair, this is exactly what Otto spelled out after the acquisition:

Together with Uber, we will create the future of commercial transportation: first, self-driving trucks that provide drivers unprecedented levels of safety; and second, a platform that matches truck drivers with the right load wherever they are.

Or Amazon.

Amazon, has previously leveraged scalable technology to first redefine retail and then redefine warehousing. They are rumored to be challenging incumbents like UPS and FedEx and are currently hiring senior logistics professionals. Sure, for now, this may be for internal logistics. But Amazon has made a habit of developing technology internally, scaling it, and then offering it as an outsourced service. Take, for instance, 3rd party online sales and FBA.

Opportunity In China.

The tech company with perhaps the most to gain from the logistics tech explosion is Alibaba. In the US, “only” about 8.2% of the GDP was spent on logistics. China, lacks the same infrastructure, especially outside the cities, so their national logistics spend balloons out to 18%. To counter this, Alibaba plans to invest some $16 billion in logistics over the next 5-8 years.

As Easy as A-B-C.

For the time being, it appears that Alphabet is still primarily focused on last-mile delivery and transportation. Google’s self-driving car has covered 1.5 million miles in four states. Underscoring the race to autonomy, a Google VP on Uber’s Board of Directors stepped down this quarter, citing a conflict of interests.

On the drone front, Alphabet is piloting food delivery via drones on a US college campus.

Technology can be the savior of the logistics industry. Ocean freight carriers, struggling in the wake of the Hanjin bankruptcy and rampant overcapacity, are just one group currently looking for saviors. To see over 70 technology developments that may be providing salvation, download Freightos’ Q3 2016 LogTech report for free.

See the updates (and the data) in the free Q3 2016 LogTech Overview