AI’s buzz in trucking is justified: Trimble panel

San Diego–Lee Klaskow, the senior analyst for logistics at Bloomberg, has seen a lot of hyped technology in his years covering the industry. Many of them have not panned out. But he’s sold on AI.

In a morning session on day of the Trimble Insight (NASDAQ: TRMB) conference here, after leading executives at Trimble had spoken of AI much of the morning, Klaskow appeared on a panel with Craig Fuller, the CEO of FreightWaves, and Alex Formoso, the executive vice president for procurement and supply chain at Polyglass U. S. A.

, which manufacturers roofing products. “I’ve been covering this space for some 20-odd years,” Klaskow said. “It’s the first technology hype that’s actually worth the hype.” Remember blockchain?

He rolled through other technologies that have grabbed the spotlight over the years: autonomous vehicles (“we’ve been talking about autonomous for maybe 25 years”) and blockchain. “There’s all these other things that came and went,” Klaskow said. “With AI, we’re definitely seeing the benefits,” Klaskow said.

“Whether it’s a broker using to let you know there’s a missed pickup to figuring out when the next pickup should be, or customer service or rate pricing or route optimization.” He cited the experience of C. H. Robinson (NASDAQ: CHRW) whose proof of its AI success is evident in its rising revenue and profitability even as it cuts headcount substantially.

Brokers eager, carriers less so Fuller said brokers make the best customers for new technology because “effectively these guys are the day traders of the industry. They’re the ones that are most willing to adopt far more than the asset carriers.” Selling any sort of new technology to asset-based carriers, he said, “is a very long sales cycle.

They tend to be much more cynical about improvements.” But Fuller added that is a natural outcome of being in a business “where you have to pay attention to every penny.” But for brokers, he said, “they’re interested in anything that can give them the edge to buy more efficiently.” “There’s only two ways to make money in brokerage,” Fuller said.

“Either your margin expands on a per transaction basis, or you do more loads.” But with heightened regulatory scrutiny over what sort of carriers brokers are employing, broker margins are compressing, Fuller said. “So the only way brokers are going to increase their profits is to do more volume, and AI is a way to help them optimize that solution,” he added.

Take caution in your approach But there was caution on the panel as well. For example, Fuller said he was a board member at a company where AI was implemented with few results to show for it, except for one big negative: the drivers hated it. “The next board meeting, the management came back and said ‘we’ve gotten no more productivity.

In fact we’ve upset our drivers.’” The key, he said, is not to put AI “between you and your most important resource.” Formoso said something similar. Representing the shipper point of view, Formoso said Polyglass is regularly bombarded with emails and phone calls.

The format of them is usually the same, as he described it: “You know, we could do everything for you. We are a broker.” The response, Formoso said, is “delete, delete, delete.”

But the contrast that does get his attention, Formos said, is a broker that knows, for example, that Polyglass moves product from Texas to Florida “and I see that you do eight or nine per week.” A potential backhaul might be offered, he said. Doing its homework That’s a sign the broker has “done a little bit of homework,” Formoso said.

“Now I’m not just an email.” Fuller, in comments he has made in other forums, said the current freight market is “the most interesting time since deregulation.” And one of the reasons, he added, is the opposite of deregulation: “regulatory pressure and oversight, and that’s creating a whole new playbook.”

Technology and AI are “part of the story,” Fuller said, “but I think what’s more interesting is how the government is actually interfering in some ways or impacting the freight market in ways that they haven’t done in frankly years.”

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