How E-Commerce Affects U.S. Surface Transportation

Import and Export Concept: Forklift truck, cargo container and plane at a dock yard against sunrise sky

Without government regulation, the supply chain industry could not exist in its current form. The United States government builds roads and the infrastructure needed to manage traffic on the ground, at sea, and in the air, so it’s natural for government agencies to be involved with every mode of transportation in the supply chain.

As the logistics industry and the world economy evolve, the government updates its regulations to keep up with the times. For example, e-commerce has relatively recently become a major factor in global trade. Now that the U.S. House Subcommittees on Highways and Transit and Railroads, Pipelines, and Hazardous Materials are considering 2020’s update to the Fixing America’s Surface Transportation Act, e-commerce is a concern.

What’s Different About E-Commerce?

E-commerce, specifically business-to-consumer sales, depends on intermodal transportation. In the brick-and-mortar retail model, retail outlets receive items in bulk, and consumers take them from the store to their homes or places of business. In the e-commerce retail model, goods go directly from warehouses to consumers. This final leg of shipping is called the “last mile,” and it represents a different way of thinking about shipping.

The U.S. federal government is a major source of funding for surface transportation projects. Shipping industry leaders are working to ensure that the government approves and builds the right projects to support thriving e-commerce. There are three areas of concern:

1) Collecting Accurate Data
Making better decisions starts with having the best information. Collecting accurate freight data related to e-commerce shipping is the best way to ensure that new projects are meeting the needs of today and tomorrow.

2) Increasing Flexibility
Trusting Congress to manage transportation projects and investment nationwide is a recipe for disaster. Since changes in last-mile shipping trends affect localized areas, building flexibility into federal grants and allowing local governments to manage local projects is a better way to go.

3) Reducing Greenhouse Emissions
The supply chain industry depends on large vehicles like trains, ships, and increasingly due to growing e-commerce, trucks. We often associate these vehicles with greenhouse gas emissions. According to the EPA, they expect the transportation sector to produce over 1,800 million metric tons of CO2 each year. The House subcommittees must consider options that encourage reducing emissions for shipping e-commerce to remain sustainable.

E-commerce has made goods more accessible and life more convenient for people in every corner of the globe, and it depends on efficient logistics to do so. Cooperation between the government and the shipping industry will ensure that e-commerce continues to make an overall positive impact.

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