Physical internet, the ‘logistic innovation of the century’

In the logistics and transportation terminology, it is common referring to notions such as network and connectivity. However, recently there is much discussion around the term Physical Internet (PI). How is the PI defined, and what innovations can it bring in the future of logistics? Fernando Liesa, Secretary general at the Alliance for Logistics Innovation through Collaboration in Europe (ALICE), shared some interesting insights on the topic during the latest Rhine-Alpine smart talks event.

The focus of logistics has lately turned towards the sustainable ways that trade and transportations can operate. The main issues that the sector faces, especially after the outbreak of the Covid-19 pandemic, concern the agility and resilience of services. Additionally, the environmental problems caused by climate change, together with the circularity of sources, remain always on the foreground. Could the realisation of the PI vision benefit the sector and obtain a sustainable future for transportation and living standards in general?

Features and functions

The goal for a Physical Internet that will replace current logistical models is set for 2030 on a European level. Ten years later, by 2040, it is estimated to be fully operational. Its functions will resemble these of the Internet with the application of data-transferring concepts in real-life transportation procedures.

Their difference will lie on the nature of characteristics: efficient transportation routes will replace high-speed fiberoptics, for example. Moreover, instead of local area networks, the PI will operate with logistics networks. Finally, local devices that are essential for connectivity will be replaced by logistics nodes that are going to be vital for the distribution of goods.

Furthermore, the networks compiled by logistics nodes will assembly a global logistics system, which will guarantee the seamless flow and sharing of data. This latest characteristic will constitute the basis of PI. After all, achieving interconnectivity and interoperability can prove unfeasible without intense digitalisation of services and broad access to data.

Implementation

In overall, PI aims to transform the way that goods are handled, transported and stored. On top of that, it aims to change traditional transportation maps, since the interested parties will collaborate on the basis of optimal connectedness between hubs. Working on a regional level will be crucial, and this is how the expansion of the whole system will take place: by granting open access and plug-and-play connectivity to its members. Regarding the governance of the system, it will be established globally, with regulatory frameworks and governance bodies ensuring the growth of PI.

Undoubtedly, imagining the future of logistics in the context of Physical Internet might sound distant, but the sector is not that far from realising the plan. To move towards this direction, though, logistics need to, first of all, focus on some present issues. For instance, they must manage efficiently the continuously growing demand for freight. This needs to happen with the attention turned to the smart utilisation and combination of transport modes. Additionally, all fleets and assets need to be shared more extensively and get used to the maximum. In that way, the logistics and transportation sector can set the right foundation for a sustainable future.

Author: Nikos Papatolios

Editor at RailFreight.com

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