Transport is taking it slow
Slow food, slow fashion, slow travel. What about slow transport, does that make sense in our superfast 24/7 economy?
Having been working and studying international transport for over 25 years, slow transport is the latest upcoming trend of the industry. Counterintuitively it doesn’t make sense to take it slow in transport. Time is money and fast transit times makes that products arrive earlier at the customer’s doorstep, thereby also reducing cycle stocks. From a cash-to-cash cycle perspective, it reduces working capital across the supply chain.
Yet, we are witnessing the fresh breeze of slow travel and slow transport. The shipping industry is already familiar with slow steaming. In times of crisis this tactic is applied to reduce overcapacity in shipping markets. Positive side effects are the energy savings and emissions reduction. Shippers are not too enthusiastic about slow steaming though, as service levels go down.
“Cutting ship speed by 20% would cut sulphur and nitrogen oxides by around 24%. There are also significant reductions in black carbon, which are tiny black particles contained in the smoke from ship ” (BBC, 11 November 2019)
The trend for slow transport is happening. In both Germany and Sweden, domestic air travel is in decline, while passenger traffic by rail is on the rise (Bloomberg, 2019). Whether business people are becoming more aware of their own CO2 footprint or not, slow transport offers advantages as well: more ‘quality’ time for work while in transit, and less hassle with cumbersome security checks in airports.
On inland transport in Europe, similar changes are visible. Shippers have a growing interest in transport by barge and to lesser extent by rail. There are good examples where shippers, port authorities and deepsea terminals align their schedules and offer more reliable barge services. For intercontinental transport of containers, there’s ample time to plan for the inland transport, as long as the actors share data for better planning in advance. For empty containers, barge has become the default mode of transport. With better planning, retailers are also making the shift, as long as services are reliable.
“Left unregulated, ships and airplanes could be responsible for almost 40% of global emissions in 2050 if other sectors decarbonise’ (Transport & Environment, 2015)
On the high seas the stakes are higher. Up until now shipping and aviation are not part of the Paris agreement, but for how long? At present shipping contributes 3% to global GHG emissions, but the share of shipping could be 17% if left unregulated. Inevitably the transport industry – both at sea and in the air will need to adjust to the new normal and factor in their carbon footprint in the tonmile. Ideally this could be done voluntarily by transitioning to zero emission propulsion technology, or compulsory by taxation or via the implementation of an emission trading system. On a European scale the European Commission is pledging for Green Deals while technology advanced countries like Netherlands have recently signed Green Deals for the maritime industry. Demands from consumers, BCorps and governments are becoming ever more pressing.
Then there are new eco-transport concepts. The world’s oceangoing fleet of 50,732 ships – almost all using heavy fuel oil – cover a total cargo distance of about 57,000 billion ton/miles. An important reason why global supply chains can exist is because of the incredibly cheap transport for a tonned carried over sea. Ecoshipping is a concept which takes zero emissions literally, shipping cargo on sail. Some shipowners have taken traditional tallships back in service, while modern turbine-based wind power technology is advancing quickly. Savings are estimated to save 30% on fuel consumption and emissions. How serious should we take this? Well, Manitou Group signed a contract in April 2019 to ship a thousand tractors across the Atlantic Ocean on a NEOLINE 136m/450ft powered by 4,200sqf of sails. With such wind power on board, speed is hardly an issue.
What about the legal side? Under current charter parties, shipowners earn money by speeding up to the port of destination. When the ship is notified ready for unloading the owner can incur demurrage – a compensation for the waiting time – In the old days this made sense, as the arrival time could not be estimated, only calculated on the basis of its speed and distance. In today’s digital age with AIS tracking, such contractual arrangements keep a negative business model for shipowners alive, and by doing so are counterproductive in pursuing energy saving programmes.
Can slow transport be true?
The true question is not whether slow transport can exist. Across the supply chain there is still so much time to save, just by planning smarter and working together. So in a way, the industry has accepted slow supply chains. It’s all a matter of time pressure. We feel the need to perform efficiently, not effectively. Transport professionals are being valued on efficiencies, i.e. productivity for a particular task in a maze of complexity. We feel the need to perform efficiently on a task. Whether it served the purpose is of less importance.
The big question is whether we can accept to take it slow at all. Only in weeks like the Christmas holidays we are forced to slow down, spend time with our families, some go to church, some reboot in luxury resorts, some go up the mountains to go skiing, others read books under the X-Mas tree. Finally there’s time to let go on the speed of life. Time has caught up on us. Maybe it’s our mortgage, or even our own mortality. When we want to take climate action seriously, the world has to slow down, thereby use less fuel, travel shorter distances, using slower modes of transport, plan more wisely. The journey is what makes it worthwile, not getting there as fast as possible.
Take it slow, and enjoy the time warp in your holidays!