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3 Changes You Should Expect To See in Transportation in 2022

The coming year will bring big changes to the transportation industry that every company should pay close attention to.

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Opinions expressed by Entrepreneur contributors are their own.

Like all industries, transportation is constantly moving forward and adapting. Because the industry has such an influence on other sectors, knowing what’s ahead in the coming year can help the public and business leaders plan and adjust well. 

SERGII IAREMENKO/SCIENCE PHOTO LIBRARY | Getty Images

There are three big areas to be aware of.

1. Increased focus on sustainable transportation

Over the past several years, increases in fires, storms, and other events have brought the climate crisis into greater light. As a result, shareholders of major companies are demanding that companies disclose climate risks and take on more responsibility for the influence they have on the environment. Investors and private equity firms are also asking companies what they plan to do to take care of the planet. Consumers are prioritizing sustainability and don’t want to be associated with environmentally irresponsible brands. Because companies are feeling this pressure from multiple directions, they’re going to focus more on environmental, social, and governance (ESG) standards. Within that, electric vehicles (EVs) are going to be a bigger part of companies’ overall ESG strategies.

One reason the transportation industry is going to focus on EVs is that vehicles serve as mobile billboards that essentially advertise companies doing good in the world while doing good in the world. They are a quick and effective way for companies to show they are committed to ESG standards. Businesses are also anticipating that, as people see more and more EVs, demand for these vehicles will go up and the price will gradually come down to make them even more attractive to buyers. 

Another reason for this change is the fact that EV charging is expanding, which makes the vehicles more practical and accessible in more locations. This is important in the public space because a lot of people still have range anxiety. Before they buy an EV, they want reassurance that they won’t be stranded while driving their normal routes. More charging stations will enable companies to use hybrids to transition to EVs gradually as needed. On the business side, a better charging infrastructure, along with the ability to make larger batteries that can deliver the power necessary to handle a bigger load, will make it more practical and reliable for companies like Amazon to use EV pickups and vans. So, those are going to hit the market, too. 

Related: 3 Stocks with Big Expectations in 2022

2. Transportation digitization

Increasingly, companies are interested in the data showing how their drivers are doing. They want to know that people are safe and keep track of where they are. That interest is motivating companies to collect, analyze, and apply more telematics information from sensors within vehicles. The issue is that companies can have vehicles from more than one manufacturer, which means they have multiple data sets they need to extract and compare. This is leading to more digitization that allows the companies to connect vehicles into a single system. 

Digitization also connects to the broader use of autonomous vehicles. Although we’re not quite ready for pilot programs using the everyday cars most people drive, there will be an increase in those programs for mid-mile transportation, such as shuttles. Those will happen in large transportation corridors. With this push, companies will have to face major concerns related to autonomous vehicles, including how they’re going to be regulated and insured. 

Related: 5 Game-Changing Ecommerce Trends in 2022

3. Supply chain disruption

Due to both the global energy crisis and COVID-19, there’s currently a shortage of silicon. Manufacturers use silicon to make not only the microchips in most vehicles but also other components like gaskets and sealants. So, manufacturers are struggling to build enough vehicles to meet demand. Customers are paying more and have fewer choices when they go to buy. Because the reasons behind the shortage are not easy to resolve quickly, the transportation industry will likely have to deal with supply chain disruption well into the coming year.

Looking more specifically at EVs, as new companies arrive in the market, the demand for battery supplies is going up. Experts predict that, although manufacturers will likely be able to get through 2022, moving into 2023, we’ll start to see a lithium shortage as demand outstrips supply. That probably means the price of EVs won’t drop as fast as it might have otherwise.

Broadly, supply chain disruption is going to continue to impact supply chains on virtually everything else. For example, many businesses are recommending that people order holiday gifts now, not only because it’s taking longer to build products but also because there aren’t enough vehicles and drivers available to make all the deliveries. Some experts assert that businesses will be short more than a million drivers over the next 10 years.

Related: Supply Chain Delays Will Spread Well Into 2022 and Possibly 2023

The opportunity is here to experience real revolution

The year 2022 will be a mixed bag for the transportation industry. There are supply chain concerns and challenges, but there is great potential for the industry to take significant steps forward that can benefit both people and the planet. Overall, it’s poised to be not an evolutionary year, but rather a revolutionary one where the growth that happens completely alters the way vehicles are designed, made, and used. Prepare well, because once the 2022 year is over, no one will approach transportation and everything related to it the way we once did.
Brendan P. Keegan

Written By

Entrepreneur Leadership Network Contributor

Brendan P. Keegan serves as chief executive officer at Merchants Fleet and was recently named the World’s Most Innovative CEO by CEO World Awards. Keegan is also the silver winner of Executive of the Year by Best in Biz Awards and a Stevie Awards bronze winner by American Business Awards.