On the right track with sustainable and smart mobility
Mobility Week has just finished (16 - 22 September, ed.). It was the perfect opportunity to stop and reflect on sustainable and smart mobility. On the other hand.... ‘stop’? Thanks to smart logistics and clean transport, everything runs like clockwork in the warehouse, truck drivers know exactly which route to take and ordered goods are delivered on time. Major investments are still needed to achieve climate-friendly and efficient mobility. That presents opportunities not only for the environment but also for investors.
Sustainable and smart mobility in the streetscape
Smart mobility can already be seen in Bremen, Germany. Numerous new neighbourhoods are being built there on former commercial and industrial sites, incorporating innovative and climate-friendly mobility concepts. There will be no cars in these new neighbourhoods, except for the emergency services and street cleaning vehicles. There will also be no underground car parks for cars, only for bikes. Cars can be parked on the edge of the neighbourhood in communal garages, equipped with cargo bikes, rental bikes, e-scooters and – from 2028 – autonomous electric shuttles. Residents can then travel the last few metres to their apartments car-free.
For the transition to climate-friendly transport to succeed, it is essential that motorised mobility continues to evolve towards smart mobility over the coming decades. The transport sector is responsible for a fifth of greenhouse gas emissions. 90 per cent of those gases are produced on the road by cars and lorries.
Sabrina Reynen, Portfolio Manager at KBC Asset Management
On land...
Sustainable and smart mobility is thus already making its presence felt on land. In areas like Bremen, that means no cars. But people are not going anything like as far as that everywhere. Where cars do figure in the streetscape, electric vehicles and the associated charging points are becoming especially prevalent.
Autonomous vehicles, such as self-driving cars, trucks or subways, also already exist. Using sensors, artificial intelligence and Big Data, they are able to drive more safely than humans. They help prevent traffic and work accidents and optimise traffic flows, contributing to lower emissions. But although the technology is constantly improving, we are still a long way from the 100 per cent self-driving car that will allow us to drive 'freely' through our streets.
Trains are one of the most sustainable forms of travel. On average, one train takes 45 lorries off the road. Alstom is the world leader in sustainable and smart solutions for railways. The company is committed to further improving sustainable operations and the passenger experience. A comfortable ride is assured, in all weather conditions. Specially treated windows provide better reception for personal mobile communication devices. Each carriage contains multifunctional spaces for prams, bicycles, wheelchairs and toilets. Level access ensures improved accessibility, including for travellers with reduced mobility. A digital hearing system based on Bluetooth for hearing-impaired travellers completes the social picture. Alstom also carries out maintenance to increase vehicle availability and achieve significant savings over the lifetime of the trains.
... at sea...
Leaving the land behind, what about all those who want to sail the seven seas? Shipping is responsible for between 3 and 4 per cent of global carbon emissions. Sea-going vessels cover thousands of kilometres carrying millions of tonnes of cargo. Add to this the inland waterways vessels and it is clear that this takes a lot of energy, which still comes from fossil fuels. On the other hand, we should not forget that shipping is still a very efficient method of transporting large quantities of freight.
Is there such a thing as a sustainable and smart port? Actually, there is. In fact there are several of them. The port of Rotterdam, for example, has launched an ambitious project for emission-free inland and coastal shipping. The first electric inland vessel came into service in 2021, operating on interchangeable battery containers developed by Zero Emission Services (ZES). May 2023 also saw the introduction of the first zero-emission hydrogen-powered barge. Even hydrogen-powered vessels need to refuel, however. The port therefore installed a system hydrogen refuelling stations along the River Rhine between Rotterdam and Cologne, allowing the first 10 to 15 inland shipping tankers to run on hydrogen in the years ahead.
To fuel the day-to-day logistics operations, the port has even developed hydrogen trucks and a public hydrogen refuelling station. The insights gained will be used for the further development and application of hydrogen in heavy road transport.
... and in the air
Like other transport sectors, aviation is also moving towards the use of renewables, albeit with greater practical challenges. In June 2019, the European Aviation Safety Agency (EASA) and the Civil Aviation Authority of Norway signed an Innovation Partnership Agreement to accelerate progress towards the electrification of aviation. Technological developments related to the use of hydrogen in aviation are also emerging. However, the challenges are considerable and there is still a long way to go.
Avoid-Shift-Improve
The building blocks of sustainable and smart mobility are reduce, shift and improve: reduce or even avoid motorised car transport and freight transport; then shift towards environmentally friendly means of transport; finally, continuously improve from that point on through the use of new technologies and smart networks.
Sabrina Reynen, Portfolio Manager at KBC Asset Management
Making smart logistics and clean transport a reality by investing in innovative techniques is essential for the companies involved.
The Belgian drink and brewing company AB InBev, for example, is investing in ten additional Volvo E-trucks for the sustainable transport of beer to and within cities, resulting in zero emissions, less noise pollution and a more enjoyable driving experience for the drivers. This order continues the partnership between AB InBev and Volvo, with a view to making transport within and between our Belgian cities more sustainable. This collaboration fits in perfectly with AB InBev's Reduce and Replace Strategy, where 'Reduce' stands for reducing unnecessary mileage and 'Replace' for using alternative fuels and technologies. The brewer is also increasingly investing in multimodal transport, such as by boat.
Logistics centres that are equipped for the advance of smart logistics and clean transport today will reap the benefits in the future. Some warehouses already have software that can manage and control the day-to-day warehouse processes from the moment goods and materials enter the distribution centre to the moment they leave again. Warehouse racks and computer-controlled forklift trucks work together as one here, and incorporate efficient routing strategies for order picking. Precision storage techniques with narrow aisles, mezzanine structures and vertical lift systems allow optimum use to be made of the available space, resulting in a fivefold increase in storage density.
At peak times, such as Black Friday, the software responds very intuitively, for example by increasing staff numbers. This allows the bottlenecks caused by Black Friday to be predicted more accurately and dealt with more effectively. This approach can also be exceptionally useful in the food industry, for example for ensuring there is sufficient barbecue meat in stock when the weather turns nice.
Sustainable and financial goals go hand in hand
Companies with a visible commitment to sustainable and smart mobility do not go unnoticed, but receive the recognition they deserve. For example, Van Moer Logistics won the award for the best logistics project at the Transport & Logistics Awards 2024, with a fully automated filling line which ensures that human hands no longer come into contact with certain toxic and non-toxic substances.
At the same awards event All Sport, a family-run business specialising in the distribution of sports and lifestyle brands, won the Logistics Building of the Year award with a new distribution centre that also serves as its headquarters.
Smart logistics and clean transport are helping to build a sustainable future. By embracing innovative technologies, governments and companies can reduce their environmental footprint while improving quality of life and productivity. However, turning this vision into a reality will require significant investment. That’s where investors can make a difference. And while the road to smart logistics and clean transport still offers plenty of challenges, the potential rewards for the environment, as well as for your assets as an investor, are well worth the effort.
As an investor, you too can be part of the transition to a more sustainable world by investing in companies that embrace smart logistics and clean transport, actively working to reduce their environmental footprint.
Sabrina Reynen, Portfolio Manager at KBC Asset Management
Read more about responsible investing?
This article is informational only and should not be considered investment advice.
