Trends and expectations for 2024 in the transport and haulage sector
As we’re about to step into 2024, the UK’s road haulage and logistics industry finds itself at a crossroads, poised for transformation amid a backdrop of evolving technologies, regulatory shifts, and global economic dynamics. Reflecting on a year of so much change and challenges within the industry, it will be fascinating to see how this resilient industry adapts in the next calendar year.
The Tech Takeover
In a sector that was historically cautious about embracing technology, transport is now rapidly catching up with other industries, but still holds some adversity towards tech adoption.
John Lyons, Global Cloud Transformation Leader for consulting at PWC UK suggests that “A lot of the issues holding organisations back are cultural, rather than technological”, which has previously been especially apparent in the transportation sector. However, more and more hauliers are now viewing the adoption of technology as crucial due to ever-growing customer expectations for full journey visibility and autonomy, pushing the industry to rely more on technology than ever before.
A report from Fourkites cited that out of the 250 surveyed top UK logistics companies, 62% of respondents rate themselves as “not great” or “struggling” at digitising their supply chain – suggesting that at the least there is an awareness of the need for modernisation, paving the way for increased tech adoption in 2024.
Gradually Going Greener
Sustainability remains a central theme in the industry, driven by the UK’s recommitment to achieving net-zero carbon emissions by 2050. Logistics companies are expected to embrace greener practices, leading to increased investment in electric (EVs), hybrid, hydrogen-powered (HVS), and bio-fuel (HVO) vehicles.
Collaboration across the supply chain will play a crucial role in reducing the environmental impact, with a focus on infrastructure development and incentives from governing bodies. As of 2040, all new HGV sales will be required to have zero emissions, intensifying the industry’s push towards eco-friendly solutions, and 2024 will be a key year for the route towards decarbonisation.
Combatting Cyber Criminals
The UK government reports that 32% of businesses experienced a breach or cyber-attack in 2022, with 59% of medium-sized businesses falling victim to attacks. More and more, we’re seeing that these cybercrime groups have become highly sophisticated and complex in their methods, able to breach the security of banks and even governments.
The haulage industry has not been immune to cyber-attacks, as alarmingly these attacks appear to have intensified over the past 18 months with the likes of KNP Logistics, Royal Mail, Owens Group and Mandata falling victim to these events. Expect increased investment and continuous prevention methods in 2024 to counter the rising threat of cybercrime.
Further read: The Cyber Security Guide for Hauliers
Tighter Rules & Regulations
Brexit is still to be finalised, and further changes are scheduled for the very start of 2024, including increased paperwork, tighter importing measures, and more paperwork. These changes could inevitably result in further disruption and delays during the movement of specific goods. Fortunately, operators have been given time to make suitable adjustments, and next year will be all about the implementation and adherence to these new changes.
In addition, DEFRA’s new mandatory digital Waste Tracking is prompting operations to adapt to a digital way of working. Although only officially introduced in 2025, it will be available on a voluntary basis from April 2024.
Should we expect further legislation or regulatory changes in 2024? Quite possibly. With Net-Zero 2050 approaching and increasing pressure on haulage to reduce emissions, we may well see some further emissions-related regulations.
Driver Skills and Shortages
Despite positive improvements in the well-documented driver shortage crisis of previous years (43% increase of HGV practical driving tests taken in the first quarter of 2022), 2024 presents a new challenge. The Office for National Statistics estimates a record number of almost half a million driver qualification cards are set to expire in 2024, necessitating significant re-training efforts. This equates to 17 million hours of required retraining, which will almost certainly strain training facilities and driver availability in 2024.
The rise of e-commerce, accelerated by changing consumer behaviours, will continue to shape the logistics landscape. With consumers expecting faster and more convenient deliveries, companies will need to invest in technology to support these demands.
Collaboration between software platforms and logistics providers will be crucial to meeting the growing demands of online shoppers. Using customer portals, improved communication with customers, and more visibility provided to customers can set businesses on their way to facilitating the growing needs. .
Anticipate AI Adoption
Once a futuristic curiosity and sci-fi dream, Artificial Intelligence (AI) is now firmly entrenched in our everyday lives. UK government reports indicate that approximately 1 in 6 UK businesses, around 432,000, are already incorporating AI into their operations highlighting AI’s prominent rise.
Although larger companies are currently leading the way – with 68% of large businesses, 33% of medium-sized businesses, and 15% of small businesses having integrated at least one AI technology – it is expected that in 2024 SME businesses will follow suit, given the UK AI market’s estimated worth of £16.9 billion, projected to reach £803.7 billion by 2035.
The transport and distribution sector is already seeing a gradual adoption of AI, with nearly one-fifth currently using AI in some capacity. Another 16.5% of non-AI users are planning to adopt AI in the future, equating to roughly another 14,500 businesses. Expect to see movement with haulage and AI very soon.
The world of transport and logistics is always an unpredictable one, however, some of the inevitable challenges are firmly in the crosshairs of those hauliers who use today’s time and resources to prepare for tomorrow’s growth.