New IBM study addresses trucking’s future through a digital transformation

A study recently released by global technology giant IBM takes a deep dive into the intersection of the intersection of the future of the trucking industry while it goes through a digital transformation.

The study, entitled “Truck 2030: Digitally reinventing for the long haul,” was published by the IBM Institute for Business Value (IBV) and its findings were based on feedback from 1,320 executives from 1,188 companies in various trucking-related sectors, including commercial vehicle manufacturers, and ancillary manufacturers like bodies, trailers, engines, and utilities, among others, with $5.8 trillion in combined 2019 revenues and 16.7 million employees.

The study’s key findings highlight just how much the digital transformation in trucking will impact the industry in the future, including:

• $465 billion in annual revenue will likely shift from sales to services by 2030;
• 64% of truck executives say their organization’s future success depends on digitally reinventing themselves;
• 48% of surveyed executives say customized customer experiences, enabled by digital technologies, will be an important competitive differentiation for 2030; and
• $118 billion will likely be spent to continuously reskill employees by 2030, among other findings

The study also pointed to how data insights are impacting the ways in which motor carriers need to leverage what it called “meaningful, actionable insights” for things like strategic decision making, operations transformation, and targeted customer experiences. It also examined platform plays, regarding how carriers are active in myriad platforms used to manage assets, business processes, data, fleets, and technology. New technologies were also cited for the ways in which intelligent automation is changing how companies operate by using advances in technology to optimize processes, personalize customer experiences, and enhance decision making.

Perhaps the most telling finding in the study focuses on how while trucking has long been viewed as a “singular, manual, labor-intensive process of picking up and delivering a package,” it is now being replaced by carriers moving forward with various logistics processes, including: capacity-as-a-service, crowdsourced delivery, truck platooning, optimized predictive maintenance, driver/truck/road specific routing, smart cargo, and automated driver assist, and others.

The study’s authors—Ben Stanley, Automotive, Aerospace & Research Lead - Institute for Business Value, IBM, and Dr. Daniel Knödler, Director Global Sales Automotive, Aerospace & Defense Industries, IBM—provided their respective insights on its findings, with an eye on the future.   

“These big manufacturers are really starting to see the need and the opportunity that digital technologies are going to bring to them,” said Stanley. “When you look at the innovation going into vehicles today, trucks in particular, it is innovation driven by software and technologies and what things like cloud and AI can do and all of these types of things that can really change how [trucks] can deliver products and services. There are also the innovations that are in the cab itself and that platforms can provide and connect these equal system partners together. And there are things down the road, like autonomous vehicles, to consider as well. There is just this need to continue to innovate and not just innovate products, which has been the mainstay of the industry forever. It is really innovation around new business models. That is where we start seeing these shifts in the revenue streams, with these new opportunities around fleet services and all these other models that are coming about. It is not just being talked about now. They can do things, and it is starting to drive this change.”   

Knödler added that technology and platforms are seen as big benefits for the future, coupled with collaboration, which is driven by platforms is very clear, and is a core focus area for executives in all areas of trucking.

“What was most surprising for us [in the study] was when we asked the executives about loyalty of their customers, or fleet owners, it was not so much about total cost of ownership, which remains a clear focus,” he said. The safety benefits from automated driving and device integration as much more important.”  

With the study highlighting that 64% of truck executives say their organization’s future success depends on digitally reinventing themselves, Stanley said number came in higher than expected and that it speaks to the hypothesis of the surveyed executives that companies need to reinvent themselves and shows how important it is to the trucking industry.

And Knödler said that had that figure been in the 70% or higher range, it would not have been viewed as a surprise.

“All the customers that we are working with, especially the OEMs, know that they have to digitally reinvent themselves,” he said. “This is not happening overnight; it is more gradual and is noted in the study as it relates to things like configurators and predictive maintenance. There are a lot of companies collaborating with their suppliers on things like end-to-end digitization, and that is very much present in the industry and driven by the OEMs.   

The study also featured data for a group it called “The Visionaries,” which comprised 12% of the executives interviewed, with 60% commercial vehicle manufacturers and 40% ancillary manufacturers, whom represent 29% of the total revenue of the surveyed companies and 27% of the total employees of surveyed companies.

Stanley said this group has a clear understanding of their business model and a clear digital strategy, translating into having a higher sense of urgency and organizational readiness, as it relates to digital transformation efforts.   

To access the “Truck 2030: Digitally reinventing for the long haul” study, please click here.