Estimating the Traffic Congestion Footprint of Retail E-Commerce

Abstract

The last decade has seen pivotal changes in the "last mile" of logistics: online order volumes are growing, customers are expecting deliveries with quicker turnarounds, and new technologies such as drones and electric vehicles are reshaping suppliers' fulfillment strategies. This study estimates the effects of e-commerce logistics on urban mobility, seeking to quantify how efforts by e-commerce suppliers and carriers to meet shifting consumer demands impacts traffic congestion as experienced by city drivers. Because the impacts to traffic caused specifically by e-commerce operations is not directly observable, we estimate these effects using traffic simulation models.

We find that the impact of last-mile e-commerce activities to traffic congestion depends heavily on changes to people's travel behavior as they purchase more goods online. If people make fewer daily shopping trips to brick-and-mortar stores, traffic congestion will improve. If people complement online shopping with in-store shopping, traffic congestion will degrade. To mitigate potential negative traffic impacts, we recommend carriers reform their delivery networks to limit the distances delivery vehicles must travel within cities. Introducing micro-fulfillment centers close to end customers, serving secure lockers where consumers can pick-up packages, transitioning to alternative delivery vehicles with smaller traffic footprints, and consolidating packages onto fewer delivery vehicles with larger cargo capacities can all help reduce the traffic congestion induced by last-mile operations.