30 August 2019

The Australian transport industry and digital evolution

Australia’s $48.9 billion+ pa transport and logistics industry’s truck traffic is projected to grow 50% from 2010 to 2030. This rapid growth can only be achieved practically by adopting new technologies.

From the uptake of performance based standard (PBS) vehicles to picking and packing robots, the way freight is consigned and delivered is undergoing a digital transformation.

The rise and rise of e-commerce is transforming supply chains, with digital technology and automation making warehouse operations faster, safer and more efficient.

Enter vision-guided, fully autonomous mobile robot forklifts with the capacity to pick loads four times faster than humans. Some goods may be delivered directly by drones, with customer data the key factor in driving logistics and reducing costs. Integrated solutions providers will use digitalisation to match supply chain services to customers’ locations and needs.

New skills for tech-based roles

Job opportunities generated by these trends include

  • procurement
  • distribution
  • operations
  • logistics
  • scheduling.

These roles will also demand upskilling and succession planning in the 1.2 million+ current workforce as nearly half (48%) of transport and logistics workers are aged over 45 and lack technology training. With an estimated that 44% of Australian jobs at risk of automation the transport sector will need to adopt and learn new skills.

Automation and safety

Already low-cost, internet-connected sensors are used in vehicles to provide information and provide information, and fleets are connected via vehicle to vehicle communication to centralised networks, enabling more effective deployment

Autonomous emergency braking and advanced speed control are widely available, and fully autonomous vehicles, already employed in mining and defence, are gaining interest from the freight sector and are predicted to enter the public roads system between 2020 and 2030, possibly initially in first and last kilometre deliveries.

In the meantime big data can be used to map freight movements and identify bottlenecks and congestion, contingent on the development of robust cyber security, encryption and cloud computing to protect vehicles and businesses.

Setting standards

The National Heavy Vehicle Regulator performance based standards (PBS) Scheme aims to improve safety and efficiency of heavy duty vehicles (12+ tonnes) used in freight transport, through factors which can be assessed and controlled:

  • specifications
  • design for purpose
  • access to road networks
  • implementation of safety management systems.

The scheme is administered by assessing how well a vehicle behaves on the road through a set of 16 safety and four infrastructure protection standards.

Once an applicant’s vehicle has been approved they must apply to individual jurisdictions for access to the state or territory road network via their PBS permit.

According to a 2014 Austroads study, PBS-approved high productivity freight vehicles (HPFVs) were involved in 76% fewer accidents than conventional transport equipment. This is expected to lead to an estimated saving of 96 lives by 2030.

With so much change on the horizon, the transport industry cannot afford to stand still. In order to remain competitive, and indeed survive, transport businesses and logistics operators across Australia will have to upgrade to more modern vehicles and more efficient delivery and warehousing processes or they will be left behind. Technology is here to stay. Adopting it could ensure your transport business is around for the long-haul, too.

Want to know more about safeguarding your transport and logistics business?

Gallagher provides insurance protection to businesses of all sizes, from sole operators to some of the world’s most iconic brands. Talk to a Gallagher transport and logistics team insurance specialist in your area.

Connect with an expert


Further reading

Transport and logistics insurance

3 of the biggest challenges facing the freight and logistics industry

Gallagher provides insurance, risk management and benefits consulting services for clients in response to both known and unknown risk exposures. When providing analysis and recommendations regarding potential insurance coverage, potential claims and/or operational strategy in response to national emergencies (including health crises), we do so from an insurance and/or risk management perspective, and offer broad information about risk mitigation, loss control strategy and potential claim exposures. We have prepared this commentary and other news alerts for general information purposes only and the material is not intended to be, nor should it be interpreted as, legal or client-specific risk management advice. General insurance descriptions contained herein do not include complete insurance policy definitions, terms and/or conditions, and should not be relied on for coverage interpretation. The information may not include current governmental or insurance developments, is provided without knowledge of the individual recipient’s industry or specific business or coverage circumstances, and in no way reflects or promises to provide insurance coverage outcomes that only insurance carriers’ control.

Gallagher publications may contain links to non-Gallagher websites that are created and controlled by other organisations. We claim no responsibility for the content of any linked website, or any link contained therein. The inclusion of any link does not imply endorsement by Gallagher, as we have no responsibility for information referenced in material owned and controlled by other parties. Gallagher strongly encourages you to review any separate terms of use and privacy policies governing use of these third party websites and resources.

Insurance brokerage and related services to be provided by Arthur J. Gallagher & Co (Aus) Limited (ABN 34 005 543 920). Australian Financial Services License (AFSL) No. 238312