Local Delivery Commercial Telematics System Subscriptions to More than Double from 2021 to 2026

Nearly 19% of total global retail sales to be online in 2021, emphasizing last mile’s exponential growth
28 Sep 2021

The extensive cost of last mile delivery often leads to a lack of profitability, with over 50% of shipping costs attributed to last mile alone. The increasing demand for e-commerce and rising consumer expectations has placed greater pressure on companies to expedite delivery while keeping costs low. Consequently, the last mile market is seeing a push in the adoption of autonomous technology across multiple regions and form factors, such as commercial telematics systems. These systems address efficiency challenges through advanced route optimization, location intelligence, prognostics, and preventative maintenance. According to global technology intelligence firm ABI Research, local delivery commercial telematic system subscriptions will more than double over the next five years to reach 1.2 million by 2026.

“The COVID-19 pandemic fast-forwarded online retail worldwide by five years. Retailers and fleets must accommodate surging demand, along with increasing customer expectations for service. Yet too many businesses continue to use outdated systems and broken processes, lacking a seamless information flow,” explains Susan Beardslee, Principal Analyst, Supply Chain Management and Logistics at ABI Research.  At the same time driver shortages, rising insurance costs, and the complexity of fulfillment complicate the path forward.

In addition to commercial telematics, one solution in suburban and urban location has been the use of Autonomous Mobile Robots (AMRs) such as Nuro, Starship Technologies and the Amazon Scout.  Their use will grow worldwide by 44% over the next five years, influenced by costs, convenience, regulatory support, and a desire for contactless delivery.  “It is critical that businesses fully optimize the final leg of the transportation journey, to not only materially reduce the total cost of delivery, but also to offer a consistent customer experience that is safe, efficient, and compliant,” Beardslee concludes.

These findings are from ABI Research’s Last Mile Trends and Critical Enabling Technologies application analysis report. This report is part of the company’s Supply Chain Management & Logistics research service, which includes research, data, and analyst insights. Based on extensive primary interviews, Application Analysis reports present in-depth analysis on key market trends and factors for a specific technology.

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