Six Reasons for Optimism in 2016

We are soon to run a piece looking ahead to 2016 with comment from various experts in the transport industry.

It’s true that there’s a greater element of uncertainty this year than we have been used to, but there are also many reasons to be optimistic. Ahead of our expert commentary blog I thought I would list my reasons for feeling that the transport industry is in a great place right now, better than it has been for some time.

1 – Demand: The Society of Motor Manufacturers and Traders (SMMT) announced last week that Commercial Vehicle registrations reached an all-time high in 2015, surpassing pre-recession levels for the first time and hitting 423,894 units. With demand for trucks up by a quarter and the best ever year for vans, it looks like confidence and demand is in a strong position.

2 – The Internet: The late great David Bowie correctly predicted the future of the internet in the late 1990s – releasing “Telling Lies” in 1996 as a digital-only release. He understood that the internet would break down the barriers between musicians and their audience. It’s amazing that he could be so correct 16 years ago, with his predictions being true of retailers and consumers too. With so many commercial transactions now taking place online, and this continuing to grow, the transport industry has never been more essential.

3 – Servitization: The way that products are consumed is changing and moving from an asset-led consumption model to a service-led set up. An example of this, which is often used, is the pioneering transformation of Rolls Royce. It no-longer sells engines to airlines, but instead sells hours of power, taking responsibility for everything involved with the delivery of thrust as a service. This isn’t new, but it is a transformation that we will see go further in 2016, influencing the supply chain, making it more complex and driving demand for yet more data, often delivered by telematics. Goodyear spoke on this topic at the free-to-attend 2015 Microlise Transport Conference and registration is already open for this year’s event, which is set to be the largest road transport conference in Europe.

4 – Reliance on Road: The highway continues to be the most important method for transporting goods and services. Eurostat estimates that some 90% of inland freight is transported by road in the UK and around 76% in Europe. These figures are due to be updated soon, though we would not expect to see a great change. They highlight how road transport operations continue to be the most important freight network for the UK economy.

5 – Maturing Technology: Technology is becoming easier to use, more intuitive and generally, easier to obtain value from. Since the early days of telematics, many advances have been made, with the technology now being able to achieve a lot more. It can now feasibly shave a tenth off fuel bills, increase utilisation and engage drivers to improve their safety record, without needing an expert team to crunch the data. It’s been trialled in beta, tinkered with and updated, incrementally improved and finessed. Alongside advances in consumer devices, such as smartphones, technology adoption has the capability to drive business efficiency and ultimately growth, now more than at any point in history.

6 – Increasing Government Support: In December the Department for Innovation and Business approved a new Trailblazer apprenticeship programme to help and encourage the next generation of young HGV drivers. Meanwhile government agency, the DVSA, is embracing technology as part of its next generation enforcement where so-called exemplar operators can gain Earned Recognition. These are two signs that government understands the importance of the transport industry and is supporting its regulation and continued prosperity.

This list doesn’t aim to be exhaustive but instead gives six signs and trends that give me optimism for the future.

Uncertainty in global markets, a local imbalance in qualified drivers and other external pressures do threaten our post-recession gains, but given the underlying trends there are undoubtedly many things to be positive about.

We believe that it is the responsibility of everyone in the industry to contribute towards resolving the shortage of drivers here in the UK which has the potential to restrict growth in the transport sector. Keep an eye on our blog in the coming days and months to see how we plan to do our part and help to address this.

In the next blog update we’ll deliver the opinions from various influencers, decision-makers and experts in the transport industry as they give their thoughts for 2016.