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Uber Struggle: Uber disrupted taxis, but trucking will be harder

Posted: July 5, 2017 by John G. Smith

The role of a road warrior on the Today’s Trucking editorial team takes me across North America, and at times these stops don’t include a personal car. If I want to keep moving, the options have been limited to the kindness of companies I visit, shoe leather, or taxis.

Until I uploaded the Uber app on my phone.

I am admittedly a late convert to ride sharing, but it is unlike anything I ever experienced with a cab. Taxi companies have left me stranded, failed to show up at appointed times, or arrived with cars held together by little more than Bondo and bailing wire. The Uber app displays cars that are nearby and tracks them every block along the way. Once the ride is done, my credit card is automatically billed and an invoice is uploaded by email. No more need to negotiate fares or calculate tips.

It’s a model that has allowed Uber to disrupt and outright threaten the taxi industry wherever it has a presence. And now the company has a taste for trucking.

The first step was to acquire Otto, which plans to retrofit trucks to drive autonomously and made headlines by delivering 2,000 cases of Budweiser beer in a demonstration run. In mid-May, meanwhile, Uber unveiled Uber Freight with the promise of transforming the way loads are booked and moved. That is undeniably closer to its core business.

As similar as the vehicle-sharing options might appear, the trucking industry represents a tougher haul for this software developer.

What Uber has unveiled is essentially a load board, albeit with a brand recognized outside of trucking.

When I reached out to Uber to describe the difference, a spokeswoman replied: “Uber Freight is an app, available for download on iOS and Android, that matches trucking companies with loads to haul. Its mission is to make the day-to-day lives of truck drivers easier by providing transparent pricing, fast payment, and the ability to simply book a load at the touch of a button.”

As I said. A load board. There are already plenty of successful examples of those.

Even if the company finds success with that, and can address a sexual harassment scandal that has shaken its executive suite, the existing Uber model isn’t about to truly disrupt the trucking industry. When tackling taxis, Uber was able to tap into fleets of underutilized cars. Everyone with a vehicle became a potential competitor to cab drivers.

In contrast, commercial vehicles are highly utilized. Fleets that park their equipment against a fence for extended periods of time face bigger threats than an app.

Still, there are some lessons to be learned from the taxi industry.

Uber’s disruptive presence is about more than providing cars at cheap rates. It used software and data to provide a better experience for customers, and taxi companies failed to respond. Truck fleets that fail to find new ways to connect with customers and their loads will lose business, whether it’s to Uber or someone else.

And while the Uber model might be limited when it comes to booking 53-foot van trailers or reefers, the idea of car-sharing services could still play a disruptive role in last-mile deliveries of small packages. Amazon is already testing this in select markets, through a service known as Amazon Flex.

Yes, there are threats on the horizon. Uber threats. Even if they emerge through companies other than Uber itself.

 

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