With 21,000m² of floor storage, the Horrea Galbae, located on the outskirts of the Empire’s capital, served as a warehouse model for almost two millennia… However, none of our illustrious predecessors experienced the convergence of factors now affecting the logistics sector. The first is urban concentration, which brings an ever-increasing share of human activity together in cities. 73% of Europeans now live in cities, and the latter generate 85% of GDP. The second is the recent explosion of e-commerce and the related consumer demands. The equation is simple: more than 87 billion parcels have to be delivered per year, in increasingly dense cities, all within a one-day lead time…
In this context, traditional methods have their limits while congestion and pollution saturate urban areas. Cécile Maisonneuve, President of the La Fabrique de la Cité think tank, believes that the concept of parking spaces for deliveries needs to be re-examined: “We need to come up with a management system that makes it possible to have a flexible road system, depending on the time of day and the day of the week. If there is high demand for road occupancy, it must be more expensive, whether for personal vehicles or delivery vehicles”. To illustrate the opportunities and risks that surround the sector, we have devised three scenarios for the near future.
Scenario #1: Logistics anarchy
This first hypothesis assumes an extension of the regulatory uncertainty and competition between all players, which currently prevails in the sector. 12% of logistics companies are integrating partnerships into the heart of their development strategy in 2020. 10 years later, that figure has not changed, and cities are struggling to stabilize an effective framework for logistics. There are many new entrants, who rely on the existing infrastructure. Crowdsourced delivery services, like Instacart or Amazon Flex, are based on a precarious workforce without providing a solution to congestion and pollution issues. War is also waged over space as temporary parking spaces, drones and self-serve lockers invade the pavement, reawakening memories of the invasion of electric scooters 10 years earlier. The necessity to adapt is forcing property developers to come up with “parcel friendly” projects, while the roads are dynamic and multi-use as in Barcelona.
This disorderly scenario nevertheless has positive spin-offs. Some players are innovating to simply dispense with delivery all together. In the area of small parts, 3D printing allows vehicle manufacturers to produce some parts on site…
Scenario #2: The city takes back power
In a second scenario we imagine strong cities, which take over the control of last-kilometre logistics by means of regulations and significant investment. Here, major infrastructure work is changing the face of a city that is taking its destiny into its own hands. Major metropolitan development companies team up with manufacturers and start-ups to provide controlled delivery.
The groundscapes designed by architect Dominique Perrault, such as inverted buildings, are growing. They accompany a reduced need for long-term parking, coupled with a growing need for services. The first level is designed as an annex to the roads and brings together all last-kilometre services: lockers, temporary parking, checkrooms, etc.
Underground becomes a site of major infrastructure work. The CST, an underground cargo system used in Switzerland, is extended worldwide while major cities have underground goods transport networks.
Lastly, pooling and consolidation by industrial players is encouraged by the regulatory framework. In France, Urby local warehouses are developing in the heart of the city while Urban Logistics Hotels (HLU) stand out as the prevailing model. With 900 housing units, 33,000 m² of office space, 6,000 m² of public facilities and a multi-modal logistics hotel of around 40,000 m², the Chapelle International project in Paris serves as a standard measure.
Scenario #3: GAFA land (Google, Apple, Facebook and Amazon)
Finally, as a third option, the leading players manage to share the market. Concentrated in a small number of powerful companies, the optimisation of logistics flows is left to the private sector. Capable of massive investments, these players push for widespread delivery automation.
The large carriers dispense with drivers, switch to electric, and use interconnected fleets. From 2020, Volvo’s Vera project, tested at the Gothenburg terminal in Sweden, foreshadows the future. The last kilometre does not escape robotisation. Continental uses its driverless vehicles combined with independent four-legged robots for door-to-door deliveries. Amazon’s Scout robots are already roaming most cities. In terms of traceability, multi-connectivity and the IoT allow e-merchants to track their parcels in real time. At the same time, warehouses are pursuing a logic of automation that has already largely begun in 2020. The digital giants are also investing in the urban landscape and roads. The concept of “The Dynamic Street”, developed by Carlo Ratti and Sidewalk Labs is now adopted by city centres around the world. It makes it possible to vary road use according to the time of day and constraints: what was a cycle path in the morning can become a playground in the afternoon…
To manage these complex systems, the digital infrastructure remains in the hands of GAFA or Alibaba, which can offer their services all along the chain…