In a study, Geotab analyzed the main trends in last mile delivery in Europe during the most intense end-of-year sales periods, the famous Golden Quarter ranging from Black Friday and Cyber Monday, to the holiday periods.
“During the Golden Quarter 2023, we see a fragile balance between responding to increased consumer demand and taking into account environmental concerns, which are more prevalent in consumer choice,” said Edward Kulperger, Senior Vice President Europe, Middle East, Africa at Geotab.
“As last-mile delivery companies face unprecedented pressure, it is imperative to adopt sustainable, data-driven practices that are aligned with growing trends among increasingly environmentally conscious consumers. . Foresight in route planning and adoption of electric vehicles are more than just business strategies; they are quickly becoming part of the fabric of sustainable, forward-looking urban growth,” added Edward Kulperger.
In line with market predictions, the last mile sector has demonstrated resilience with a current valuation of €44 billion and an expected average annual growth rate of 10% through 2025. However, this growth comes with challenges, including an expected increase in emissions from delivery-related traffic and traffic congestion in major cities.
The World Economic Forum estimates that emissions from delivery traffic in the world’s 100 largest cities will increase by 32% by 2030, while traffic congestion is expected to grow by more than 21%. This equates to an extra 11 minutes of travel time for passengers every day around the world, and much more for delivery fleets.
The study also shows that last-mile logistics efficiency remains a critical issue, accounting for up to 40% of overall delivery costs. At the same time, companies are committing to more environmentally friendly practices, which is leading to a diversification of delivery methods.
Geotab’s analysis of aggregated and anonymized data from more than 4 million subscriptions worldwide revealed strong growth in the use of light commercial vehicles (LCVs) during peak sales, putting great pressure on resources for last mile deliveries. The data also showed a significant increase in idling ratios and fuel consumption, including CO2 emissions. There is also an increase in shorter journeys but with more frequent stops, which adds complexity to fleet management.
Fuel costs and increased usage: During the week of Black Friday and the week of Christmas last year, Geotab recorded an average consumption of 46 liters of fuel (for thermal vehicles), higher than the consumption of base of 44 liters of fuel during a “normal” week. Assuming the average fuel cost is €1.75, the additional cost is €3.50 per vehicle per week, which equates to €81 per vehicle per week.
The report highlights a linear increase in the number of electric vehicles (EVs), although their average proportion in fleets has not increased at the same rate as that of thermal vehicles). This suggests that there is interest in EVs, but constraints such as charging stations and upfront costs prevent faster adoption.
View the full Geotab Driving the Last-Mile report
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