Deutsche Post DHL has unveiled five visions of the future and their impact on trade, business and society in a new study “Delivering Tomorrow: Logistics 2050”.
In most of the five scenarios demand for logistics services climbs. But the particular requirements placed on logistics providers and the special challenges they face vary widely from scenario to scenario.
1. Untamed economy – impending collapse
The world is characterised by unchecked materialism and mass consumption. This non-sustainable way of life is fed by the relentless exploitation of resources, a development that stokes climate change and causes natural disasters to mount. In a world characterised by tumultuous growth, demand for logistics and transport services climbs sharply. A global transport super-grid ensures a rapid exchange of goods between centres of consumption. But as climate change advances, supply chains are increasingly disrupted, a development causing additional challenges for logistics companies.
2. Mega-efficiency in mega-cities
“Mega-cities” have emerged as the world’s power centres. They are both the main drivers and beneficiaries of a paradigm shift toward “green” growth. To overcome the challenges of expanding urban structures, such as congestion and emissions, Mega-cities have become champions of collaboration. Robotics has revolutionised the world of production and services. Consumers have changed their habits: Products are now usually rented, instead of purchased. Highly efficient traffic concepts have relieved congestion. A global super-grid with mega transporters, including trucks, ships and aircraft, as well as space transporters, has opened important trade connections between the Mega-cities of the world. The logistics industry has been entrusted to run city logistics, utilities, and system services for airports, hospitals and shopping malls.
3. Customised lifestyles
This scenario describes a world where individualisation and personal consumption are pervasive. Consumers are empowered to create, design and make their own products. Newly developed 3D printers play a major role here. This leads to a rise in regional trade streams, with only raw materials and data still flowing globally. Customisation and regional production are complemented by decentralised energy systems and infrastructure. The implications for logistics include a vastly reduced need for long-distance transport of finished and semi-finished goods due to the localisation of value chains. Logistics providers organise the entire physical value chain. They also handle the encrypted data streams required for the transmission of construction and design blueprints for 3D printers. The decentralised organisation of production turns strong regional logistics capabilities and a high-quality last-mile network into important success factors.
4. Paralysing protectionism
This scenario describes a world where, triggered by economic hardship, excessive nationalism and protectionist barriers, globalisation has been reversed. Technological development is lagging. High energy prices and dramatic scarcity of supply lead to international conflicts over resource deposits. Implications for the logistics industry include challenges posed by the decline in world trade and the resulting regionalisation of supply chains. Governments view logistics as a strategic industry. As relations between some blocs and countries are extremely strained, logistics providers in bloc-free countries act as intermediaries in international trade brokerage.
5. Global resilience – local adaptation
This scenario describes a world initially characterised by a high level of consumption thanks to cheap, automated production. However, due to accelerated climate change, frequent catastrophes disrupt supply chains and lean production structures, resulting in repeated supply failures. The new economic paradigm is distinguished by a shift away from efficiency maximisation to vulnerability mitigation and resilience. This radical move toward redundant systems of production and a change from global to regional supply chains allow the global economy to better weather troubling times. The resilient world in 2050, with regionalised trade, relies on a logistics sector that ensures supply security as a top priority, with backup infrastructure to guarantee reliable transport in unstable and hazardous times. Instead of complex just-in-time delivery processes, huge warehouse structures located close to the manufacturer are seen as indispensable buffers.
DHL chief Frank Appel said: “In this complex economic, political and social climate, it has become practically impossible to make linear forecasts. In a world that is becoming harder and harder to predict, we have to expand our horizon and think about alternatives. We can devise robust strategies and set the right course only if we have gained an understanding of different perspectives.”
The study was compiled by 42 industry experts from organisations such as the World Economic Forum, the Rocky Mountain Institute, the Copenhagen Institute for Futures Studies, the World Business Council for Sustainable Development and Greenpeace International.
The chief economist of the International Energy Agency, Fatih Birol, and the former German environmental minister and director of the UN environmental program Klaus Töpfer, were also on the panel.