Cities and Urbanization

How delivery companies can help cities reduce congestion and emissions

Freight congestion remains a serious issue for cities, contributing to congestion, emissions, noise, and road accidents.

Freight congestion remains a serious issue for cities, contributing to congestion, emissions, noise, and road accidents. Image: Unsplash.

Jamie Wylie
Lead, Urban Mobility, World Economic Forum
Adrienne Gibbs
Lead, Global New Mobility Coalition, World Economic Forum
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Cities and Urbanization

This article is part of: World Economic Forum Annual Meeting
  • Whilst e-commerce growth is slowing, it is still well above pre-pandemic levels.
  • Freight congestion remains a serious issue for cities, contributing to congestion, emissions, noise, and road accidents.
  • Innovative, sustainable solutions are needed to reduce cities' delivery footprints, presenting an opportunity for private sector leadership in efficient practices.
  • The Forum's Global New Mobility Collaboration is exploring how the private sector can lead on sustainable, innovative deliveries through a new campaign.

Since the early 2000s, online shopping has transformed consumer expectations and behaviours. Next-day delivery and food delivery apps have become commonplace, and the rise in remote work has made home deliveries more convenient. These trends, amplified during the COVID-19 pandemic, are likely to persist.

In response to this, companies – from logistics providers, to retailers, to e-commerce – have been quick to respond, adding services and flexible delivery options to meet consumer demand. But with these changes come challenges. Inevitably, growing demand means more vehicles on the road. At a time when cities are already struggling to tackle congestion, additional delivery vehicles on the road are resulting in longer travel times, and it’s impacting local economies. On top of this, increasing delivery vehicles poses challenges for carbon emissions, as well as road safety.

As governments strive for more sustainable cities, now is the time to address the footprint of deliveries and explore innovative solutions.

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How can the private sector lead change in urban deliveries?

Whilst many cities are actively trying to address congestion and environmental issues, policy and regulation – such as congestion taxes and other measures – need to be paired with private sector action. Embracing new, innovative, sustainable solutions in deliveries stands to bring significant benefits to the private sector, from e-commerce, to retail, to logistics providers. In doing so, companies can capitalise on new business opportunities, create more efficient practices, and collaborate with government to create more liveable, sustainable cities. Here, we explore how companies are already taking action.

Electrifying freight

Companies across the deliveries landscape are embracing the transition to electric vehicles (EVs). Amazon, as part of its Climate Pledge, announced a commitment to add 100,000 electric delivery vehicles in its fleet by 2030 through a partnership with EV startup Rivian. As a major player in deliveries, this signals a significant shift in the market towards electrification.

IKEA is also leading in the EV space, having announced its commitment to 100% zero-emission last-mile deliveries in all of its markets by 2025. Additionally, DHL has committed to converting 60% of its last-mile delivery operations to EVs by 2030, while major beverage companies like AB InBev are also expanding their zero-emissions deliveries.

However, simply replacing existing vehicles with EVs will not solve the congestion challenges – other solutions will also be needed.

Embracing tech and data

Data and tech are at the heart of innovation in deliveries. Data-driven solutions can help to better understand frequency, types and patterns of deliveries and find solutions for more efficient logistics.

In Gothenburg, Sweden, the city administration has been addressing this challenge through data sharing with the private sector. The city has partnered with logistics companies to introduce data-sharing agreements, producing greater information on delivery routes and space usage. This provides insights on issues such as the use of loading zones and helps to develop more efficient use of space, as well as guiding future decision-making on logistics. Logistics companies – such as Postnord and Schenker – have already signed up to the initiative, benefiting from insights to reduce unnecessary driving, minimize queuing, and reduce emissions.

EIT Urban Mobility, in collaboration with public and private partners, is exploring the potential of data through a range of trials and pilots. For example, the Coding the Curbs project is testing a platform for logistics companies to book loading zones in cities. Working in collaboration with cities including Groningen and Bucharest, the project aims to demonstrate how bookable loading bays can help to improve delivery times and reduce unnecessary vehicle miles. Whilst still in early stages, the company is already working with logistics companies to test how this could create more efficient deliveries.

Cities and companies working together

Many businesses are exploring how taking a collaborative approach with city administrations can help tackle challenges. In the financial district of London, Amazon and the local administration collaborated to create a Last Mile Logistics Hub in an underutilised car park, where 39 parking spaces were transformed into a hub for Amazon to deliver parcels, with cargo bikes and on-foot deliveries heading out from the car park. In doing so, the collaboration aimed to remove up to 85 vehicles from the road every day.

In another example from London, a major real estate owner partnered with stakeholders to reduce delivery traffic on Regent Street, one of the main shopping areas in the city. The real estate owner collaborated with a logistics company to supply retailers with goods through a single consolidation centre, with pre-defined deliveries made by electric truck. This has helped reduce delivery vehicle movement by up to 80% in the area.

Exploring new partnerships

In 2020, Uber announced commitments to become an emissions-free mobility platform by 2040. In 2023, the company expanded this goal to eliminate emissions on Uber Eats deliveries by 2040, and is now partnering with e-mobility and charging leaders around the world to increase car-free deliveries.

In Taiwan, for example, the company is partnering with Gogoro, an industry leading battery swapping and electric scooter company, to make it easier and more affordable for delivery people to transition to greener delivery modes. Launched in 2023, the partnership offers Uber Eats couriers discounted electric scooters and battery swap programmes as well as benefits. Due to quick adoption by couriers, Uber Eats and Gogoro are expanding their partnership for an additional two years. Together they aim to increase green delivery trips on Uber Eats in Taiwan from nearly 20% to 40% by the end of 2026.

Delivering change

The private sector can lead in creating sustainable, innovative deliveries, reducing their footprint, and capitalizing on new business opportunities. However, what is crucial to this is cooperation between the private sector and city administrations.

The Global New Mobility Coalition, an initiative of the World Economic Forum, is now exploring how public-private collaboration can deliver a sustainable future for deliveries, aiming to raise ambition and spotlight action to create innovative, sustainable deliveries. Stakeholders interested in collaboration can find out more and get in touch here.

By embracing innovation for sustainable deliveries, public-private collaboration can create liveable cities and rebuild public trust.

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Related topics:
Cities and UrbanizationDavos AgendaElectricity
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