The freight and logistics industry fulfils this role of delivering goods efficiently, on time, and affordably, contributing to more than £124 billion in GVA to the UK economy, and its contribution to the economy will grow exponentially from here.
The COVID-19 pandemic has accelerated growth in e-fulfilment. E-Commerce accounted for 6.7% of retail sales a decade ago. In February 2020 it was 19%, and by May 2020 it was 33% (ONS via the FT). WSP client contacts have told us that the spring lockdown saw 70% growth in parcel volume.
The logistics sector has and is scaling up its capacity and operations on a massive scale. This requires simultaneous upscaling of an efficient and environmentally sustainable end-to-end process from arrival in the country by air, rail and sea, interim transfer and storage, and final delivery to the consumer.
The sector already makes a significant contribution to emissions and air quality. According to the Infrastructure Planning Commission, transport from freight accounts for around 25% of the UK’s total greenhouse gas emissions, with HGVs and vans together contributing 32% of the UK’s greenhouse gas emissions.
Without action, emissions from road and rail freight could make up around 20% of the UK’s allowed emissions in 2050.
COVID-19 a perfect storm for the logistics industry?
COVID-19 has caused politicians and policy makers to reach for the environmental reset button, through accelerated policy initiatives and widespread investment in green energy and technology. In many respects this represents a perfect storm for the freight and logistics sector, as it will accelerate the purchase of electric and hydrogen powered vehicle fleets, green technology, and sustainable construction of modular zero carbon logistics sheds.
Society is also demanding higher standards on air quality and the environment, and communities want liveable places where people are attracted to live, work, and visit, and where the negative impacts of logistics activity are minimised. The biggest challenge is balancing these competing demands. Reducing the impact of logistics doesn’t have to mean that barriers are created, leading to negative perceptions, or commercial implications.