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From network optimisation to digitisation: tackling logistics decarbonisation with CargoON CEO Antoine Bertrandy

From network optimisation to digitisation: tackling logistics decarbonisation with CargoON CEO Antoine Bertrandy

Shippers are continually being pressed to bring down carbon emissions, whether it be due to pressure from consumers, higher environmental standards, or carbon taxes. So what decarbonisation methods are being harnessed here in Europe, and what can make a measurable difference in the short term?

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Gregor Gowans

Gregor Gowans

Journalist Trans.INFO

12.01.2024

Shippers are continually being pressed to bring down carbon emissions, whether it be due to pressure from consumers, higher environmental standards, or carbon taxes. So what decarbonisation methods are being harnessed here in Europe, and what can make a measurable difference in the short term?

From network optimisation to digitisation: tackling logistics decarbonisation with CargoON CEO Antoine Bertrandy

To get to the heart of these questions, we took the time to discuss decarbonisation with Antoine Bertrandy, CEO of the CargoON, a digital freight platform designed for shippers.

In his role, Bertrandy frequently talks to major European shippers and important industry bodies, while the CargoON CEO also has serious experience in the logistics sector having spent 13 years at GEODIS and a decade at ALPEGA.

During our discussion, we sought to bring as many decarbonisation solutions to the table as possible, with some ideas naturally being less obvious than others.

We also had time to discuss whether some fiscal measures, such as the recent road toll rises in Germany, can be effective.

MAUT in Germany – decarbonisation mechanism, or simply an added tax?

Indeed we began our discussion with the aforementioned implementation of new road tolls in Germany. The significantly higher tolls are supposedly designed in order to convince carriers to invest in zero-emission vehicles.

However, many industry figures have questioned whether the measure will actually work as intended. Bertrandy has his doubts too, and told Trans.INFO that because many companies are not in a position to upgrade, the MAUT changes amount to “just an extra cost and inflation.”

The CargoON CEO added:

“I’ve been working in transportation for 25 years. It all started for me back when I was heading operations at a transport company in Italy. At that time and it is still valid today, In terms of costs, the fuel cost, which has risen a lot, has a huge impact on the total cost. You need to somehow have a regulatory framework which encourages companies to enter into a virtuous cycle. However, it cannot be the case that we only use a stick as opposed to a carrot. It won’t be effective, as we need to have a lot of different ways, creative ways, in order to lower emissions in road transportation”

Intermodality and electrification

So how can we bring about decarbonisation then? According to Bertrandy, there are numerous methods.

One that the CargoON CEO is enthusiastic about, at least for long-range transports, is embracing intermodality.

“When we are discussing with shippers at CargoON, we see that the main driver for reducing CO2 emissions is to embrace intermodality,” said Bertrandy. “We meet a lot of big shippers who say by 2030, for example, want to move a major part of their long range transportation to intermodal. This really makes sense when you are talking about a long range – generally a minimum of 600-700 kilometers.”

What about electric trucks though? Like a number of industry bosses, Bertrandy sees them as being primarily for urban distribution for the time being:

“You also need to consider what zero-emissions trucks are currently on offer and what they can do. We will be able to drive about 500-600 kilometres with electric power with the new assets launched recently on the market. For the time being, however, electric will mainly be for short-range – distribution and last mile.”

According to Bertrandy, across Europe there is disparity in sensitivity regarding decarbonisation. This sensitivity is particularly true in southern European countries where long-haul operators on international routes are plentiful:

“In Spain you have 100,000 transport companies and it’s a similarly large number in Italy. In countries such as these, the market is more fragmented than in Northern Europe. It’s a big investment when you need to buy a truck, and given the amount of fruit and vegetables to be transported from the south of the continent to the north of Europe, these companies often specialise in long-haul transport. This is obviously an area where electric trucks are not economically attractive yet for many companies.”

Digital tools

Bertrandy maintains that decarbonisation in logistics is most certainly not new. He recalled during the interview how in 1996 at Mannheim University, he and his fellow students had already been working on decarbonisation, with optimisation being one of the focus areas.

“We were already discussing a lot of things, such as how to have better trucks, optimise load capacity of course, use alternative transport modes than road or commercially co-invest with customers in silos to eliminate packaging for Bulk products,” Bertrandy told Trans.INFO.

Nowadays, digitalisation has made the process of creating such optimisations a lot easier.

“IT tools offer great computational capabilities to manage a wide range of parameters far more than the average brain can manage. Moreover, there’s all the uncertainties you have on the road now, such as the complexity of the regulations like the mobility package. People still need to understand how the rules work in some countries,” the CargoON CEO told Trans.INFO.

Bertrandy added:

“With regards to transportation, It’s really routine now. I have my loads, I put it into the tool and it tells me which driver to allocate to a vehicle and what the vehicle will load. That’s how it works on a basic level, and today even small carriers are using TMSs and other digital tools to help manage a reduction in kilometers. They can also use freight exchanges to optimise vehicle capacity.”

In Bertrandy’s opinion, dock schedulers can also play a key role in decarbonising as well:

“When you have a proper dock scheduler, you can organise the arrival of the trucks at your facility better. The drivers and the dispatchers can also better organise themselves because they know when they have to deliver or to load. So that has an impact on decarbonisation for sure. Besides better planning your trip, the fact that you have real-time communications can also avoid extra kilometers due to bad communication or a change of plans and so on.”

Network management

Another lever Betrandy sees shippers pulling to cut emissions is network optimisation. Here, it’s not simply a case of nearshoring factories, but thinking about efficiencies across the network and also the optimum linked to the value of the goods being transported:

“Network optimisation is important too – where you put your factories and warehouses and what production strategy you have for your industrial footprint. When I was at GEODIS just before the turn of the millennium, we used an application to help decide where to put our warehouses in Europe from a supply chain optimisation perspective, considering a wide array of parameters going far beyond pure product, transportation and logistics cost” Betrandy told Trans.INFO.

According to the CargoON CEO, there are different strategies at play here:

“The big shippers perhaps have a setup of several plants across Europe. You can have factories dedicated to a specific products, and then you need to supply to Europe from this plant. Alternatively, you may have one plant that can produce a wide product mix. Here, of course, the transportation cost and emissions impact are different.”

Nearshoring will also have a role to play here too in Betrandy’s opinion:

“Nearshoring is relevant here as well. It will have a positive impact on decarbonisation because supplies won’t come as much from Asia. I see a lot of movement in this trend, as well as infrastructure investments in the next 2-4 years.”

Common standards

In addition to the above, Betrandy believes that labels and standards can help to encourage shippers to use more environmentally friendly carriers and forwarders:

“From a holistic perspective, a lot is being done. There are programs that have been put in place by several environmental agencies and logistics associations. One example I’ve seen comes from the AUTF, a French Shipper Association, and ADEME, the The French Agency for Ecological Transition. They’ve launched the FRET 21 initiative, which helps shippers decarbonise via 4 pillars; filling rates, distance optimisation, transport modes and purchasing.”

According to Bertrandy, more than 350 companies are now involved in the initiative.

Minimising weight through pallet selection

When it comes to filling rates, Bertrandy added that besides maximising the capacity of each truck, steps can be taken to minimise weight where possible.

This can be done via optimal pallet choice among other things.

“You may want to reduce the number of pallets or even the weight of the pallet – perhaps by using a cardboard pallet. It’s not just just a case of maximising the filling rate of a truck, but also minimising the weight of each fully-loaded or almost fully-loaded truck,” said Betrandy.

Bundling shipments and managing expectations

Elsewhere, Betrandy believes managing customer expectations could allow transportation companies to cut costs and CO2 emissions by bundling more deliveries together:

“Another area where we can bring more decarbonisation concerns frequency of delivery and managing expectations – particularly when it comes to receiving lightning-fast, Amazon-style deliveries we’ve become accustomed to in recent years. Here it’s a case of talking with your end customer and saying that to reduce emissions, shipments will be bundled and delivered perhaps once a week or twice a week rather than daily.”

Long term vs short term thinking

Finally, another theme prevalent during our discussion was the clash between the long term solutions frequently talked up in public circles, and the achievable short term methods that can be implemented in the here and now for a more immediate impact.

“Professors and politicians may be thinking about the medium-long term and how to do things holistically. On the other hand, people involved in logistics on a daily basis need to think short term. It’s a daily fight for efficiency and profitability. You need to optimise your assets and match the expectations of your customers and shareholders, while also retaining the people who work for you,” stressed CargoON’s CEO.

Bertrandy concluded:

“There are always short-term expectations and short-term challenges. You need to deliver to your customer now. When it comes to new infrastructure like intermodal terminals or rail infrastructure, you are talking about planning 5, 10, even 15 years ahead. How do you manage this gap now? It requires flexibility in your transport management set-up and policies and visibility on the infrastructure developments and intermodal offers.

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