The Future of Freight: Tesla Advancing Freight Truck Operations in September

The future of the trucking industry is, no pun intended, at a crossroad. Recently, Tesla’s Elon Musk has announced that a Tesla freight truck will be unveiled in September of 2017. This announcement has lead to the speculation that Tesla might attempt to follow Uber into the freight market, as Uber earlier this year established an online system for pre-approved drivers to find well-paying loads much like Uber drivers can find passengers to pick up. Further speculation on what Uber and Tesla hope to accomplish include an on-demand service, Tesla Network, which could be executed through web-applications, and perhaps even driver-less all electric trucks.

This comes at a time when the industry is feeling a bit of a pinch. The truckers market has reached a point in which brokers and logistics companies are having a hard time finding trucks to move their loads, while trucking companies have more freedom to choose which loads they would like to haul. This is due to an unusually high amount of load transportation requests being posted on internet boards, compared to a relatively low amount of available truck services to transport the loads.

As a result, brokers and logistics companies are having a harder time making money on anything that wasn’t pre-contracted before this news by Tesla. An automated system, which would liaison a direct connection between a customer seeking to move their product and truckers willing to move it, at a push of a button, would cut out the need for any middle-man broker or logistics company. Although some suggest that this wouldn’t happen due to the median age of a trucker, or a provider of trucking services, being 49 years of age, makes them likely to be resistant to pervasive technology.

However, new demographics show that a large amount of truckers that are new to the industry are much younger and non-US born. For middle-men such as brokers, this could mean uncertainty for how the market will develop. At the very worst, it could spell a large loss in revenue because brokers make their money from transaction fees, called margin. Without these transaction fees that brokers collect from middle-manning a freight truck exchange, they would lose their market and independent contractors would find more work.

Socially, many non-truck drivers see trucking as an archaic method of transportation. Non-electric trucks get a very low EPA, estimated 5.5 MPG. Additionally, as populations continue to grow, truckers are often seen as polluting the roads, not only from their emission into the atmosphere but also from taking up space on the road. What a Tesla dominated industry would mean is anyone’s guess at this point, but it would be safe to assume that their fleet would be comprised of all-electric trucks. Though this is a slowly developing story, expect the ramifications to be felt mid 2020s.

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