Thursday, January 12, 2017

Uber for Trucking

Amazon prepares to roll out new app matching truck drivers and shippers.

Amazon already sells everything, and delivers everything. Now they plan to deliver using their own service, described as the equivalent of Uber for freight. The giant online retailer is building an app that matches truck drivers with shippers, a new service that would deepen its presence in the $800 billion trucking industry, a person with direct knowledge of the matter reported to Business Insider.

The app, scheduled to launch this summer, is designed to make it easier for truck drivers to find shippers that need goods moved, much in the way Uber connects drivers with riders. While Amazon declined to comment, the app is said to offer real-time pricing and driving directions, as well as personalized features such as truck-stop recommendations and a suggested "tour" of loads to pick up and drop off. It could also have tracking and payment options to speed up the entire shipping process.

This is the latest in Amazon's rumored plan to become a full-scale logistics company that controls the entire delivery cycle. Over the past year, Amazon has purchased thousands of trailer trucks and leased dozens of cargo planes while launching new "last mile" services like Amazon Flex that take packages straight to the end customer.

But Uber itself is working on rolling out Uber for trucking, getting into the long haul business with a new division called Uber Freight. And the new service would put Amazon squarely in competition with numerous other startups in this space, such as Convoy and Trucker Path, while putting a direct hit on incumbent players, including the publicly listed ones like Swift and J.B. Hunt.

But unlike its competitors, Amazon has an advantage in not having to worry about demand from the shipper's side. To make an "Uber for trucking" marketplace work, you need demand from both sides of the equation - shippers and drivers. Of course, Amazon already has a giant shipping network and a rapidly growing package volume, so theoretically it shouldn't be hard to find a load match for the drivers on its platform.

Further down the road, companies including Uber, Toyota and Alphabet aka Google are working diligently to develop driverless vehicles, which have the potential to dramatically shake up the trucking industry. We will be watching this closely, and keep you apprised as events unfold.

Kirk Shearer
800-989-0054 x103

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