Buckle up... I had a long winded version reducing to bullet points.
-Large millennial businesses feel they are clever and fresh, to me they are more of the same want more for less, nothing new. Pressuring carriers with unreasonable demands to the volumes they bring, over-dreaming. They continue to push for 2 hour appt windows for next to no additional cost and for all their packages. Obviously it will blow up your systems, they just don't want to get it.
-UPS/Fedex are reviewing emerging delivery ideas, the issue is they want a premium profit associated since they stress their systems. So what happens is they create them at a premium and then are rarely used due to cost. See Same Day/Appt delivery, rare.
-UPS/Fedex pushing back some with dimming all ground and now starting to take away discounts to over sized packages. http://www.wsj.com/articles/ups-plans-to-end-some-shipping-discounts-for-holiday-season-1434409965 (I will assume at this time Fedex will follow)
-Lots of these new ideas imo are exploratory, most will fail and feel someone will have to absorb large losses at first to get this working. Right there stops a lot of start ups. Also most of these new ideas seem limited to large metros, overall being global delivery companies there is a lot more volume that really isn't in play with these new ideas. City millennials feel they are the center of universe?
-I do see on paper that neighborhood delivery could be more widespread, but that has some issues for sure. To just have a laugh, your going to compete with a crack whore that could deliver a couple local packages on the grid, so they can get their next fix for the day? Cute. My biggest issue with this idea is what happens when delivery goes wrong?
-UPS/Fedex cannot compete with these Utopian ideas, but they are also far from proven and come with their own baggage.
-Robotic delivery, we'll have to see where automated cars go. I'm intrigued we seem to have a focus there for passenger cars, since it gets a lot of press it may feel like it is right around the corner, I feel there is still a big big step to finally making it a reality. Way too early to predict. 2030, the dude doesn't know, it's sci-fi write predicting the future nothing more, some hits, some misses, timelines next to never land.
Bottom line, not to worry, pretty far ways down the line on any volume that will have major impact impact. I do believe USPS is the largest threat to Ups/Fedex, that could have a much more immediate impact. As UPS/Fedex raise rates, USPS have opened up their network for larger packages at a cheaper rate and feel they have found some success volume wise, dollar wise we'll need more time to see.
We will see new services attempts in metro's, they will come and go, something might stick but it will be hard for most to be widespread outside of metro. There are plenty of packages out there where they could have their niche and not make much a dent to global carriers. Think of it this way, this to some level has always happened, you didn't see or hear about these and you've had plenty of packages to deliver, feel it is more of the same. Just putting a light on new service ideas raises concerns, we all want to protect or own. I do like reading what industry is dreaming up, sometimes for a good laugh.
I don't feel UPS/Fedex becoming cheaper, I see them getting back what they've been losing as shippers have been coy finding weak spots, dim and non-discounted oversize as proof. UPS and Fedex make no bones about it, these are major companies in it for long term profit and growth. What will make me chuckle is when some new start-up idea sticks a bit, it will become a Wall Street darling, shows good growth (easy to do with little numbers) but no profit. But investors will jump on it, their name will grow in media, but not really profit. Their stock price will skyrocket on no profit, however UPS and Fedex can show combined about 1.5 billion in profits per quarter and be poked by large stakeholders "That isn't good enough" with a more stagnant stock price. Go figure this
out then get back to me.
