We’ve all experienced the headache of being stuck in traffic, our frustration mounting as minutes tick away. Traffic congestion is usually considered a commuter problem, but it also hits freight shipping in unexpected ways that affect us all.
While the average urban driver lost 72 hours sitting in traffic last year, congested freight networks have added $109 billion annually to the price of goods paid by consumers. For freight operators, congestion and road closures are ongoing operational and financial problems that receive far less attention than the commuter experience.
The problem is lack of visibility. Most freight companies rely on transportation metrics that mask the variability in traffic networks. And that variability drives up freight expenses.
Addressing the hidden costs of these conditions means understanding where congestion is likely, and which planned future closures will impact long-distance transportation. Historical and planned traffic data can help operators anticipate disruptions and build resilience into their supply chains.
Congestion Hides Costs
Last year, the average cost to operate a truck hit $2.336 per mile, the highest on record. Not including fuel, costs rose by 4.2%. Average peak-hour speeds across the country’s worst truck bottlenecks fell to just 33.2 mph, a 2.8% decrease from the previous year.
According to American Transportation and Research Institute (ATRI) president and chief operating officer Rebecca Brewster, last year’s congestion delays for truckers were equivalent to 436,000 drivers idling in traffic for an entire year.
Each hour stuck in traffic represents lost time and revenue. Driver productivity falls while fuel consumption rises. The impact of congestion ripples beyond roads. Those delays affect warehouse operations, labor planning, inventory management and, ultimately, customer satisfaction.
Solutions haven’t kept pace with congestion. Transportation networks have grown significantly more complex over the last decade. E-commerce has transformed freight activity, and new mobility services have reshaped traffic patterns.
Finding a single optimal route was once a straightforward path to efficient shipping. Network complexity has changed that. A single disruption on a major corridor or intersection can now ripple throughout entire supply chains. This creates a transportation environment that’s much more difficult to predict.
Today’s logistical challenge lies in gaining enough visibility to understand changing conditions as they occur, as well as the planned closures that impact the route.
From Speed to Resilience
Because transportation networks are more connected than ever, they’re also more vulnerable to disruption. That’s why operators need to shift their focus from transportation speed to supply chain resilience.
Resilience is the ability to anticipate, adapt to and recover from the disruptions of interconnected supply chains while maintaining operational performance. Given the changing nature of modern networks, resilience has become a strategic necessity.
Supply chain resilience begins with understanding. Operators must understand why shipments are delayed, what traffic conditions are doing in the moment, and how those conditions are likely to change 15 minutes, 30 minutes, or even two hours in the future.
This broader, predictive view is transportation intelligence. Rather than focus on individual shipments and their metrics, it gives operators insight into broader network conditions that influence how goods move across roads, regions and even countries. These insights can explain not only what is happening, but why it’s happening, and what might happen next.
With this context, logistics teams can move from reactive operations toward more proactive planning. For example, speed data might help identify recurring bottlenecks, but transportation intelligence can help operators understand the root causes of those bottlenecks and when they’re likely to occur. Organizations can then reconfigure delivery schedules to anticipate delays and mitigate the impacts of hidden transportation costs, making their operations more resilient.
Moving Beyond the Moment
Transportation networks are growing more dynamic, and demand patterns are rapidly evolving. Economic conditions now shift from day to day. As networks grow more interconnected, uncertainty is becoming a greater challenge than cost. That makes supply chain resilience and transportation intelligence essential in today’s transportation networks.
Resilience and intelligence help operators navigate uncertainty rather than blindly reacting to change. Organizations instead can draw on real-time insights to identify trends, see risks as they emerge, and better understand complex patterns in transportation networks.
Twenty-first century supply chains are too complex to simply ask, “What just happened?” Operators need to think strategically. This means understanding what drives changes, how those changes can affect operations, and how to best address ever-evolving transportation dynamics.
Michael Cottle is senior vice president for INRIX Enterprise.
