Amazon’s move towards Trucking Industry

Amazon is one of the famous e-commerce company which was found in 1994, headquarters in Washington. It has separate retail websites all over the world and available in different languages.

What is a Truck?

A Truck is a means to get cargo from source to destination. It is used in both small towns and highways and said to be the heartbeat of supporting industries. This is usually controlled by a fallible human, subjected to labor laws and rules about interstate commerce. It allows the economy to function. There would be no other online shopping or other businesses without this vast network. Both Uber and Amazon which are both working on services to change the future of trucking. Both companies have similar ideas.

Uber’s Freight:

Uber, the famous transportation company, have already started the trucking business with its purchase of Otto’s self-driving truck platform, one of the biggest shippers in the country. It has launched a new unit called Uber Freight and it makes sense. Uber’s Freight first offering is to affiliate shippers with a truck, similar to how the Uber apps affiliate drivers up with riders. And hence, there will no longer be a middleman.

It will also offer shippers pricing based on good’s supply and demand. At times when there is an increase in demand for trucks, it could mean higher prices. There is a place for carriers and shippers to provide their email addresses to Uber, and links for media to contact the company and it doesn’t reveal much.

Eventually, Uber plans to keep humans in its trucks and sees trucking as an industry. The commercial vehicle operators may be needed to monitor and manage paperwork for self-driving trucks. In future, autonomous trucks need human drivers and engineers to design these trucks. The vast network of American highways facilitates both commercial trucking and family road trips. And there is no guarantee that autonomous vehicles could handle high traffic, winter conditions, or sudden hazards like other vehicles exploding.

Otto- started an initial step of autonomous driving:

Autonomous driving which is similar to that of automatic emergency braking now available in customer’s cars also. The trucks don’t have to drive every street and every corner. They only have to map the same trucks over the same routes and connect them so they can inform each other of conditions. In future, Otto has brought to the outdated infrastructure by reconstructing trucks with autonomous driving capabilities.

The modern trucks already have computers on board and also sensors are included. It equips the truck with Radar, Camera etc. There is a built-in learning curve for the driver.  It is currently testing its system using Volvos and other semi trucks. Trucks are more regulated one. There are only a handful of brake providers steering column providers etc,

Amazon’s decision to build a Trucking App:

Amazon is building an app that matches truck drivers with shippers, a new service that would expand its presence in the massive eight hundred billion dollars tracking industry. Amazon’s service would be similar in its intentions and it is working on the Uber-like app to fill its own needs.  The app is scheduled to launch this year and it is designed to make it easier for truck drivers to find shippers that need goods moved similarly to Uber connects cab drivers with riders. Hence, there is no need for a third-party broker who typically charges a commission for doing the middleman work. Usually, the Brokers can take a large percentage of a distributor’s fee to a shipping company in exchange for matching them up. Uber and Amazon will help two sides of the business communicate with each other and could take a smaller cut of the payment. This would make shipping products more productive for the folks.

But the services are likely to differ in their execution. Mostly, Uber makes its money by taking a cut from all the transactions it helps facilitate. The surge pricing makes hard for the companies to know how much they are going to spend at any given time. Amazon is more interested in selling the things to folks. The company needed a way to make sure its website performed well and then it turned into another revenue source by giving other access to it. The same thing can happen with trucking.

The trucking service could also be extremely appealing to drivers and trucking companies. Pricing, documentation, and payments are handled using phones and fax machines. The app will offer real-time pricing and driving directions, and also personalized features such as truck stop recommendations and more options like pick up and drop off. It could also have tracking and payment options in order to speed up the delivery. Over the past few years, Amazon has purchased thousands of trucks and dozens of cargo planes, in order to launch new services like Amazon Flex to satisfy the customers.

But the main goal is to improve the logistics space, which is controlled by third-party brokers who charge a bulky fee for handing the manual work and phone calls. The app aims to centralize the shipping process and brings Amazon to achieve its goal in the delivery process and developing its reach as a logistics company. Amazon is also expected to exceed Federx Company in future, which means there should be plenty of cargo to keep its driver-partners busy. Amazon logged its sixth straight profitable quarter in the month of October; its operating expenses nearly thirty-two billion dollars. The app described by Business Insider’s source seems to speed up fulfillment by using technology to swiftly match up truckers with shipping needs.

What is Convoy’s aim?

Convoy, run by the former employee has gained more profit in the business. The company has raised more than eighteen million dollars. It is based in Seattle’s Bell town develops software that matches trucking companies that have empty vehicles with companies that need to ship freight. It aims to replace the traditional practice of using third-party brokers to match trucks and shippers. With the Convoy’s app or website, a shipper enters details of what needs to be moved, and the software spits out a price for the job. The qualified drivers are alerted to accept the job. It takes a percentage of the sale of each delivery and does not disclose its cut.

Amazon the Carriage forwarder:

Amazon, an e-commerce company increases its services to help the Chinese folks to book ocean freight slots. Alibaba, Amazon’s main competitor also provides the same service for its customers.  Amazon s main focus is to full-fledge the logistics provider to compete with FedEx. The company owns its own warehouses, delivery trucks, drones etc. Its intentions are clear even though it awaits heavily on other logistics providers. Alibaba has also entered the freight forwarding businesses. Both the companies (Amazon and Alibaba) have concluded the highly fragmented and relationship-based logistics market is ready for separation. The gigantic market for e-commerce has boosted the provider’s assets to ease the market entry. The battle between Amazon and Alibaba in the field of share market seem to be a proxy economic war. By allowing Alibaba consumers to book slots directly, the e-commerce giant act as a freight forwarder to certain ports.