Over half the world’s population already lives in cities, and over the next 30 years, 2 billion more people are expected to become urban residents. By 2050, nearly 70 percent of the world’s population will be urban dwellers.
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Cities, residents, governments and businesses need to think carefully about the challenges associated with this growth — like over-stressed infrastructure and traffic congestion.
At the same time, consumer demands and shopping habits are quickly changing. Not only are we experiencing rapid urbanisation, we’re also seeing a shift in buying preferences that are enabled by new technologies.
One of the most prominent of these megatrends is the growth of e-commerce, which is estimated to hit $3.5 trillion in 2019 and more than double to $6.5 trillion in 2023. The rise of e-commerce doesn’t just have an outsized economic impact though — it has dramatic implications for how we design our transportation networks and how we plan our cities.
The transportation market itself is also undergoing a dramatic transformation. Ride-sharing companies are reshaping the mobility ecosystem as we know it, and more change is on the way. Bike-sharing, scooter-sharing and so many more technologies are guiding us toward the future of mobility as a service (MAAS). And if that weren’t enough, you also have the advent of autonomous vehicles looming on the horizon, groundbreaking alternative fuel developments, and completely new concepts like Hyperloop.
If we want to achieve the fullest benefit of the new mobility future, all those with a stake in urban planning need to get to work rethinking transportation policy, investing in critical infrastructure and enabling a better quality of life for all. It’s an achievable goal, but only through collaboration.
City partnerships, coupled with advances in alternative fuels and delivery solutions, and innovative shipping and delivery management systems will provide a path forward for smart cities and companies like UPS to create solutions that help reduce traffic congestion and air pollution.
UPS has more than 30 active projects around the world devoted to testing the feasibility of cycle logistics alone — which may not sound high-tech but really is when it’s efficiently deployed through an optimal route delivery system. We’ve rolled out our unique “e-assist” cargo bikes in Hamburg, Munich, London, Dublin, Paris, Portland and many other cities, including a test project at the Expo 2020 site in Dubai, and the results have been positive.
We load the day’s packages into a container that is dropped off in a central location in the city. UPS drivers then use alternative methods to make deliveries from that container throughout the city centre and in pedestrian-only zones — including walkers, conventional tricycles, electrically assisted tricycles and e-quad bikes.
In the right kind of neighbourhood, with the right kind of route, with the right kind of support from a city, these sustainable, human-scaled technologies hold a great deal of promise. Initiatives like this help both cities and UPS reach mutual goals: a lower environmental footprint, a reduction in congestion and more efficient transportation networks.
Another way to reduce congestion in cities is by optimising delivery routes, as the most sustainable mile is the one you never have to drive. E-bikes, drones and autonomous vehicles get a lot of hype, but some of the most impactful technologies are far less futuristic. For example, route and network optimisation tools are huge game-changers, enabled by robust data analytics, real-time feeds and mapping.
UPS’s On-Road Integrated Optimisation and Navigation (ORION), our groundbreaking route-optimisation software, is a good example. ORION provides a smarter way to determine the best route for a single delivery vehicle by using package-level detail, customised online map data, fleet telematics, and advanced algorithms to determine the most efficient delivery route each day. ORION saves UPS about 100 million miles per year.
Technology is also enabling us to more effectively manage when and where a package will be delivered, taking into account and avoiding peak delivery or traffic times in certain areas. Examples of this type of technology are UPS My Choice and our custom-built Delivery Management System, or DMS, which is currently in use at the Expo 2020 Dubai construction site. The DMS manages vehicle movements onto the site. A scheduling system organises vehicle movements, ensuring that waiting times – and emissions – are minimised while reducing the risk of congestion within the site and surrounding roads.
And in 112 countries, including the UAE, UPS My Choice reduces the need for additional delivery attempts by our drivers because this system allows customers to receive up-to-date delivery alerts and track multiple package statuses in a calendar view.
While technologies like these are making supply chains and the last-mile delivery more efficient, smart cities also need to take into consideration the brick-and-mortal reality of their infrastructure, everything from roads and rails to traffic lights and parking spots. The ability of city residents to get around efficiently, to companies like UPS serving its customers, growing economies, and being environmentally-responsible, is directly correlated to the state of infrastructure. In 2018, across Britain, Germany, and the United States, the costs of traffic—including lost productivity and delays —totaled $461bn, or $975 per person.
As cities continue to grow and become more crowded, policymakers, environmental organisations, and companies like UPS are working to create solutions for this issue. Smart cities should direct infrastructure investment at the areas of greatest need — major pinch points in our air, rail, highway and seaport networks that most hamper efficiency and safety. When cities invest in transportation infrastructure, and increase both the velocity and reliability of goods movement networks, they can have a direct impact on global economic competitiveness of their town, region and country.
But if we have to choose one buzzword to best describe the future of cities it is “partnership”. UPS will continue to actively work with city partners in Dubai, the UAE and around the world, looking to share our experience, knowledge and solutions to improve quality of life in cities, while still meeting the needs of businesses and consumers around the world.
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