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UPS Joins Blockchain Trucking Group as Technology Grows in Logistics Sector

UPS Inc. has joined the Blockchain in Trucking Alliance, or BiTA, a forum for the development of blockchain technology standards and education for the freight industry.

The shipping company said it sees the need to create industry standards and protocols to enable blockchain platforms to operate together with established technologies. In the future, blockchain standards and intercompany collaboration will support the logistics strategies that enable UPS customers to participate in global trade and finance.

“Blockchain has multiple applications in the logistics industry, especially related to supply chains, insurance, payments, audits and customs brokerage,” said Linda Weakland, UPS director of enterprise architecture and innovation. “The technology has the potential to increase transparency and efficiency among shippers, carriers, brokers, consumers, vendors and other supply chain stakeholders.”

UPS also wants to leverage blockchain technology to facilitate execution and visibility of trusted transactions between the company, its customers and government customs agencies. Blockchain, a digital database using blocks that are linked and secured by cryptography, can be used to keep record of any information or assets. This includes physical assets, like transportation containers, or virtual assets, like digital currencies.

The shipper, which is investing in capacity and leading operations technologies to build the Smart Logistics Network, views blockchain as a disruptive technology that could change many facets of global commerce.

So far, UPS is exploring blockchain applications in its customs brokerage business, with an objective of digitizing transactions. The technology would help by improving transaction accuracy and replacing existing paper-heavy and manual processes. The application would be highly secure and would generate valuable efficiencies for shippers that rely on UPS for customs brokerage.

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More than 300 companies have applied for membership to BiTA. Now, UPS and Coyote Logistics, a technology-driven, non-asset based truckload freight brokerage company that UPS acquired in 2015, are BiTA members.

The organization’s mission, according to its site, is to create “a forum for promotion, education, and the encouragement to develop and adopt blockchain application standards in the trucking, transportation, and logistics industries.”

BiTA believes that blockchain will allow for greater clarity, transparency and trust within the supply chain, but notes that without a common set of standards, those will be lacking among entities.

In addition to the BiTA consortium, other companies throughout the logistics sector are are working on independent blockchain projects. Shipping giant Maersk Line aims to digitize its trade data with help from software providers IBM Corp. and SAP SE.

In other UPS news, the company and the New York State Energy Research and Development Authority (NYSERDA) said Thursday that new technology will be developed to convert UPS package delivery vehicles from diesel to electric. UPS and Unique Electric Solutions will design, build, test and make the conversions. The project supports New York Gov. Andrew M. Cuomo’s aggressive goal to reduce greenhouse gas emissions 40 percent by 2030 by replacing diesel vehicles with clean technology.

NYSERDA is providing $500,000 in funding to develop and test the conversion system. If successful, the Bronx-based project is expected to bring a production version of the converted truck to the streets of New York City by this spring. In addition to producing a new, cost-effective all-electric conversion kit, the project will deliver a blueprint for converting up to three UPS vehicles a day. This could lead to the conversion of up to 1,500 UPS delivery trucks, which is about 66 percent of UPS’s NYC fleet, operating in New York City by 2022.

UPS operates more than 770 electric or hybrid electric vehicles in urban settings around the world, part of a fleet of more than 8,500 alternative fuel and advanced technology vehicles worldwide. The company has invested more than $750 million in alternative fuel and advanced technology vehicles and fueling stations globally since 2009.