Drayage 2023: What will the Market Bring in Drayage Shipping?

Posted by Port City Logistics on Dec 30, 2022 10:40:23 AM

Drayage may constitute only a small portion of a shipment's journey, but it is a vital element of the transportation industry still the same. Over the past couple of decades, drayage shipping and the drayage market have undergone several changes, with advances in technology driving an evolution in how companies arrange and coordinate drayage for their cargo.

In 2023, there are several key drayage shipping trends that shippers, BCOs, and freight forwarders should keep an eye on. This article explores everything you need to know about drayage and the drayage market in 2023, including the evolution of drayage shipping and the biggest drayage market trends to expect in 2023.

The Evolution of Drayage Shipping: From Manual & Tactical to Digitized & Strategic

Drayage is a process that has been around for a long time, even predating the Industrial Revolution. In fact, the word "drayage" comes from the word "dray," which is a type of horse-drawn cart once used to haul large loads of freight.

From the days of pulling cargo with horses until quite recently, much of what defined the drayage shipping process remained the same. It was primarily  a manual process that relied heavily on the manual coordination of truck drivers, brokers, and third-party logistics companies. These numerous involved parties were required to engage in a lot of back-and-forth communication to ensure that shipments were picked up and delivered on time.

Today, drayage shipping has transformed from this manual process to a much more digitized and automated process. Thanks to modern logistics solutions such as digital tracking, automated dispatching, and real-time updates, dray carriers can now be more strategic and proactive in their operations. Meanwhile, shippers can track their cargo in real time and manage those shipments more effectively.

The rise of digital technology in the drayage process has benefited third-party logistics providers as well, enabling them to reduce their operational costs while at the same time improving the quality of their customer service. Along with enabling these companies to offer their customers faster and more reliable shipping, digital technology has also allowed dray carriers to optimize their routes, reduce wait times, and maximize the utilization of their assets.

This recent evolution of drayage shipping from a manual and tactical process to one that is more digitized and strategic has benefited almost everyone involved, empowering shipping solutions that are more efficient, cost-effective, and reliable. But while this digitization of drayage shipping is certainly one of the most impactfu trends that we've seen in recent years, it's not the only trend poised to influence the drayage market in 2023 and beyond.

Big Trends to Expect in the Drayage Market in 2023

Driven in no small part by the ever-increasing popularity of e-commerce, demand for all transportation services has continued to climb. Drayage shipping is no exception, and demand for best-in-class drayage services will undoubtedly continue to grow in 2023.

Given drayage’s vital role in modern logistics, organizations must keep a finger on the pulse of the latest drayage shipping trends. With that in mind, here are the biggest drayage shipping trends poised to make a splash in 2023.

Increased Reliance on Automation and Robotics

As drayage providers continue to search for opportunities to streamline their processes and reduce costs, automation and robotics are starting to play a more prominent  role in those processes. Automated trucks have become increasingly common in drayage shipping. Even with the current limitations of autonomous vehicles, these automated trucks are ideally suited for the short, consistent routes that drayage shipping entails and are likely to become an even more significant part of the drayage shipping process. Automated warehouses and robots for sorting and distributing goods are also becoming a crucial part of the drayage process. As with automated trucks, these technologies enable organizations to both improve efficiency and significantly reduce labor and overhead costs.

Prioritizing Sustainability

Sustainability has become an increasingly important concern for companies and consumers alike, and drayage shipping companies strive to meet consumer demand by offering sustainable shipping solutions. Shipping cargo on electric trucks, utilizing renewable energy sources, and identifying opportunities to reduce waste are just a few of the ways these companies are working to make drayage shipping more eco-friendly.

Visibility and Tracking

Today, supply chain visibility is a primary objective for organizations across all industries. Everyone wants to know their freight's location at all times, even during the drayage leg of its journey. This demand for improved visibility and tracking has led drayage shipping companies to invest more in GPS tracking systems, RFID tags, and other digital tracking solutions. Going forward, the drayage shipping companies that can promise reliable viability and real-time tracking will be best positioned for success.

The Prevalence of Digital Platforms

Speaking of empowering customers to track the location of their shipments, the prevalence of using digital platforms to manage shipments is having a significant impact on the drayage industry. Shippers, BCOs, and freight forwarders use these digital platforms to access real-time data that helps them:

  • Track shipments
  • Manage billing and payments
  • Connect with customers, suppliers, and other partners

By empowering companies to manage their shipments and communicate with other stakeholders more efficiently, these digital platforms help improve customer service and optimize supply chain performance.

Bolstering Security and Compliance

Driven in part by increased shipping volume, cargo theft has been on the rise for the past couple of years. This increased risk has led companies to invest in new technologies, such as RFID tags and tamper-proof seals, to secure their shipments. Along with this increased emphasis on cargo security, companies are also making increased efforts to ensure that they comply with all applicable regulations and laws. One way we see this focus on improved compliance manifest is the increased use of compliance software designed to ensure that companies have all of their i's dotted and t's crossed.

Growth in Domestic Intermodal Volumes

Today, many carriers are reluctant to offer competitive inland CY routes, proffering to keep their equipment closer to the coast instead. This trend has led to a growth in demand for domestic intermodal shipping that is poised to continue throughout 2023. This issue also highlights how drayage shipping companies could potentially improve the inland rail ramp drayage experience. Implementing grounded operations at rail ramps versus wheeled, using IEPs and chassis pools, effectively managing allocations, and finding a resolution to appointment systems are just a few ways intermodal shipping could be more efficient moving forward.

A Continued Shift From USWC to USEC Ports

Port congestion on the West Coast is one of the most significant factors that has led to a shift from USWC ports to USEC ports. In the future, though, there are other reasons why drayage providers are following suit with their expansion and relocations. This includes increased regulations passed by the state of California, such as the AB5 ruling, its emission regulations for truckers/warehousers, and its mandate that all drayage trucks be electric by 2035.

A Continued Reliance on Local Drayage

The near-port transload model, where companies rely on local drayage providers to transport cargo to a nearby warehouse or terminal, has already taken a big bite out of the OTR long-haul drayage market. In 2023, you can expect this trend to continue. Along with local drayage and near-port transloading, intermodal rail and its lower costs will continue to compete with OTR drayage as well.

Let Port City Logistics Handle Your Drayage Needs

Port City Logistics' expert dispatch team and an experienced fleet of drivers help move over 90,000 containers in and out of the Savannah Port each year. By staying on top of the latest drayage shipping trends and cutting-edge available technology, we can offer drayage services that are swift, efficient, and reliable.

To learn more about how Port City Logistics can help with your drayage needs in 2023 and beyond, be sure to contact us today!

Topics: Drayage Logistics