In this interview in our exclusive series in partnership with Port Technology, INFORM’s Matthew Wittemeier spent some time with Alan Peterson, Industrial Segment Leader / Crane Systems at TMEIC Americas Corp. (TMEIC) – recently retired, to explore what the future, near and far, might hold for the industry. Alan offered some illuminating insights about standardization, the problem of limited port space, and the inevitable march of progress.
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MW: We’re going to get started. We learned at the beginning of 2038 that the port of Reykjavik is a fully automated terminal with limited onsite personnel. Are we on track to achieve this outcome, or is it a remote possibility at best?
AP: 2038 is really not very far down the road. I think the only way a small place like Reykjavik could have an automated terminal at this level of accomplishment is for the industry to start standardizing products and interfaces from one vendor to the next. I also think that’s a very difficult thing to accomplish, at least in the next 30 to 40 years, mainly because vendors like me and my competition seek to get a leg up on our competition. Part of the problem is that when we innovate, we don’t want to share our hard work with somebody else. So in order to standardize an automated terminal package, we’ll have to have standard platforms across the industry that everyone can feed into. I don’t see this happening if we leave it to the vendors. I think only when customers or end-users decide they’ve had enough of customization might they drive standardization across the industry.
And I think that’s a harder conversation than we know, given that we are in an industry that can’t agree on a standard twist lock. So, is it possible? Yes. Is it the outcome we will have at some point? Yes. By 2038? I don’t know. That seems kind of aggressive to me.
MW: You talked about the terminal operators needing to take that first step. Are any terminal operators today making moves in that direction?
AP: There are some that make noise about it, but it has to be more than just a single operator. Let me give you two examples. APM Terminals, of course, as huge as they are in the terminal operating world, has a fairly standard platform they like to purchase, but they’re only one operator out of many. If you look at PSA out of Singapore, they’re a pretty good-sized terminal operator. They have a standard package they want to buy, but the two are not the same. I read the specs, and they just aren’t the same.
So in order for them to drive standardization from TMEIC, ABB, Siemens, or ZPMC, they have to agree as customers on what they want, and it’s mostly boiling down to the interfaces. How do devices talk to each other? How do systems work together at a port? Could you take a Siemens package away and stick a TMEIC package in for a customer that has a standardized, across-the-board package? Yeah, that might be possible, but today it is not.
MW: With regard to systems talking to each other, the industry has certainly made a lot of progress in the last five years with initiatives like TIC 4.0 on the terminal side and the DCSA on the shipping side. It seems a lot of standard initiatives are gaining traction. Are these steps in the right direction, or is it too little, too late?
AP: You have to look at automation from a different perspective than just the ports and terminals industry. If you look at it from where the automotive industry or the bottling and packaging industry sits, they’ve had standard interfaces for everything for the last 30 years. The difference is they’re moving a bottle that doesn’t weigh much down an assembly line that’s rolling at high speed. Or if they’re making cars and they’re rolling off the assembly line at one per minute, their needs are very different. I’ve always said that automation in our industry is difficult because we’re moving 40-ton boxes with massive pieces of machinery. It’s not the same ball game. But yes, at some point, we will reach the commonality of interfaces that you see in the automotive world, the packaging world, or any other number of industries that are out there.
I have the advantage of having worked in those industries earlier in my career, and I understand where they live. If you’re Ford Motor Company and you’re ripping out a line and putting a new line in to build a different car next year, it’s a plug-and-play world, quite literally.
MW: Many innovative technologies are discussed in 2038: A Smart Port Story, with the mid-2020s seeing a significant growth period for these ideas to take hold. What technologies today, if any, do you see as being innovative and positioned to cause disruption in the maritime industry as we enter 2022?
AP: It’s a huge question. I think technologies are driven by need or demand from an end-user. There’s really no reason to have a technology if nobody’s going to buy it. So what’s the big problem? In my mind, the first big problem is space in the port industry. There’s only so much land that ports can have. There’s no new land being made unless you reclaim it from the sea, and that’s entirely too expensive. So there’s only one option, and that’s to densify, which has already driven a fair amount of automation. The next step, though, is going vertical. And that’s what we’re seeing happen in Dubai with DP World and BoxBay. I believe if there’s one thing on the horizon that could be a game-changer, it’s this BoxBay concept. Not necessarily the exact thing they’re building, but something similar that allows you to go vertical and put more boxes on the same piece of ground.
The second is to take boxes off the waterfront and put them somewhere else. If you don’t have any land, and you haven’t or can’t go up, what do you do? The question of on-dock rail becomes the big answer. I think on-dock rail and intermodal terminals are the answer to much of this problem. We’re already seeing a lot of people make moves both in North America and in Europe, where they’re beginning to take rail seriously, moving boxes from the waterfront to an inland terminal. By doing so, you relieve congestion at the waterfront and begin working boxes in a place that is easy to work because you can take a piece of unused land and turn it into a terminal fairly easily. It’s not congested, it’s not too busy. Simply put, you’re not stepping on each other’s toes to get your job done.
Finally, more automation. I think we’re going to see more and more customers move toward an automated terminal platform at some level. I don’t think we’ll see total automation like some of our Chinese friends are doing, but there will be some level of semi-automated terminal all over the place.
MW: Very interesting. I want to explore the idea of moving boxes, firstly, up. In our last 2038: Future Visions interview, we sat down with Carla Grifo from BoxBay, and we learned quite a few interesting things. Obviously, it’s a game-changer for terminals to implement a solution of that nature, but BoxBay has been very clear that it’s not necessarily a solution that fits every terminal around the world. So then, if we logically move on to intermodal, what we’re seeing in the US market right now with the congestion in ports and maritime facilities is that the congestion is being matched when those boxes move inland. There’s still a lack of drayage drivers to get the boxes out of the inland facility. So is it really a solution, or is it just moving the problem somewhere else?
AP: I think it’s a little of both. The biggest challenge is in California. I hate to say it, but the problem is being driven by government intervention. In California, they decided some years ago to do away with all the older diesel engines and trucks. So really, you can’t drive a truck in California, a big truck, unless it has a diesel engine less than three years old. What is happening with drayage drivers is that everybody who owned a truck had to buy a new one or get out of the business. What is happening is they take boxes from the port of L.A. and Long Beach to the border with Nevada. They drop them on the ground, and then somebody with a truck that is not allowed in California comes, picks it up, and takes it somewhere else. So I think that’s going to work itself out over time.
I think the congestion thing will change over the next couple of years. The real trend, though, for drayage has more beef in it than that. The reality is you can move an awful lot of boxes inland on a train as long as you have the systems in place to manage them at the port and the intermodal terminal capable of then disseminating the boxes when they arrive. We’re not seeing it yet, although I think it’ll be there. Ports like Savannah or London Gateway have distribution centers popping up right behind the terminal. We’re not seeing that around the intermodal sites that are now 300 miles inland, but I think it will come.
MW: This is also the model that Australia is adopting as well with their new inland rail, where you see major distribution and supply chain hubs popping up around the intermodal facilities. The impact of technology is used as a frame in 2038: A Smart Port Story to look at many broader social, economic, environmental, and business trends. What trends do you think will shape the future?
AP: That’s a great question. It’s a tough question for me because I’m not a futurist. I have proven to myself over and over again that I don’t have a crystal ball. With that said, I’ll give you a few predictions. The transportation fleet, of whatever kind you want, is going to change. I think you’re going to see autonomous vehicles on the sea. Ships that now carry a crew of 12 or 15 to manage 22,000 boxes will have a crew of three that does nothing more than manage the mechanical systems. I think we’ll see autonomous vehicles on land in big truck fleets. In another 10 years, autonomous vehicles will be everywhere we look.
The second thing is our fuel sources will continue to evolve to be less stressful for the environment. However, I don’t think in my lifetime or yours, we’re going to see the elimination of fossil fuels. There’s just no other good alternative yet to take an airplane off the ground or to heat the homes of eight billion people around the world. But something we don’t know about today is going to change that. Whether it’s fission or something else from a technology standpoint, it’s going to happen. When we think about governments that mandate change, they can only do so much. And that’s where I think industry and consumers are going to make the change happen, not governments. That’s just my personal view.
Third, I think a new race of beings is going to show up at some point. Not aliens, but rather machines that are artificially intelligent and can think on their own. Then, they’re going to do all the things we want them to do, and they’ll provide work and services as we need them. But I think we’re going to find another sentient race of things running around this planet in another 40 to 50 years.
MW: I was just going to ask if you care to put a time frame to that, and you already have.
AP: I think it’s coming quicker than we know. Again, I’m not a futurist, but I tend to read a lot of stuff. There are many things that are happening quickly in that world; it’s amazing.
MW: Definitely. That’s one of the key points we aimed to point out in 2038: A Smart Port Story that these things are coming much quicker than we probably think, and we need to be thinking about and discussing them today. What are the implications? What do you think would be the implications if a new sentient being came into existence, one that’s computerized and does a large portion of the work that we’re doing? The impact has to be massive on us, correct?
AP: Over time, I think so. Again, in my lifetime and yours, I don’t think we’ll see that, but maybe our kids will see it to some degree, and their kids will definitely be living with all kinds of sentient machines that are doing work in our world. Then, of course, all the doomsday stuff comes in, right? Do we believe the Terminator?
MW: That’s an interesting segue into the next question, which relates to the fact that maritime doesn’t exist in a bubble. As automation disrupts our industry, much like the anti-techs in 2038, unions around the world are pushing back against automation. As an industry, how should we be addressing the impacts of automation on human workers in our companies and in the companies we serve?
AP: As much as I love thinking about the future, I’m also a big fan when it comes to history – I love history. To give you some perspective, in 1857, New Bedford, Connecticut was the richest per capita city on the planet because of whaling. Their 300-plus vessels went all over the world, harvesting whales to feed the whale oil industry, which was necessary because you had a lamp in your house for light, and that was better with whale oil than it was with a candle. Twenty years later, that industry was gone. Thousands of people were put out of work, and hundreds of companies evaporated because petroleum was discovered and took over. The same thing happened when we went from horses to automobiles or, to the point of our industry, when we went from slings, boxes, and burlap bags to containers. That was only 66 years ago.
The natural consequence of innovation is a shift in what people have to do to make their way in the world. Yes, it’s uncomfortable. Change is never easy, but what can our industry do? I don’t know that it’s our industry’s place to determine how society deals with change. I think we can mitigate some of that because the unions are going to push back. We’re not going to go fully automated. We’re going to be easing into these things. As I said a moment ago, I think you’re going to see a lot of semi-automated terminals come up before full automation takes over. And I think a big reason for that is our friends in the unions are pushing hard against it. We cannot go as quickly as we would like to go, “we” being the terminal operators. It’s just the way it is.
MW: It’s a very interesting perspective that it isn’t necessarily the industry’s challenge to solve. That would imply to me that it’s the people’s challenge to solve, and people are represented by their government. But we talked earlier about how when government becomes involved, they don’t necessarily make wise decisions that benefit the industry. So, should we be taking a stronger advocacy role and trying to intelligently influence the government’s final decisions, or should we just sit back and watch it happen?
AP: I think that’s a great question. Again, it comes down to when consensus is reached among groups of people, whether those groups are industrial companies like mine or groups that get represented in government. I think it’s very difficult for the industry to do that unless a broad segment of the industry gets involved. I still think it boils down to the individual taking responsibility for themselves. I hate to say that, but if you look back at 1857 in New Bedford, Connecticut, at some point, all those whalers had to go out and find a different job, and they had to do it pretty quickly. That industry collapsed virtually overnight. They got it done. All those beautiful homes in New Bedford are still there, but the millionaires are not living in them anymore.
MW: We’ve reached the year 2038 in our interview. Sadly, that means we must draw to a close in a minute or so. What’s the one thing that our readers should take away from this interview?
AP: I think there are three things. First, change is hard. No matter what it is, change is always hard, whether it’s thousands of people losing their jobs because petroleum killed the whaling industry or because automation takes over in our industry. We must accept that life is not always easy; change is hard.
Second, progress is going to happen regardless. As long as people want more, want better, and are willing to pay for it, progress continues.
The last part of that relates to what we spoke about a minute ago, which is the third thing: we either adapt or get left behind. That’s pretty simple, but that’s where my thoughts lie.
MW: Alan, thank you so much for joining us.
AP: My pleasure Matthew.
Who’s Alan Peterson?
Alan has been involved in technical sales since 1980, joining first Westinghouse and then GE in 1989. Initially responsible for supporting heavy industry, container ports, and shipbuilding in Virginia, USA, Alan transitioned to TMEIC Americas in 2006 and has since been working full time in the marine container terminal marketplace. Container Terminal automation and advanced lifting equipment technologies are his specialties.
He has recently retired from his role as Business Segment Leader for the Crane Systems Business Group within TMEIC Americas Corporation. His responsibilities included managing a global sales force, directing the commercial operations of the Group, and helping to shape the strategic direction of the business. TMEIC is Toshiba Mitsubishi Electric Industrial Corporation based in Tokyo, Japan. The Crane Systems Business Group is based in Roanoke, Virginia, USA.
What is 2038: Future Visions?
2038: Future Visions is a series of interviews from leading maritime logistics professionals who share what they expect our industry to look like in the year 2038. It is brought to you in partnership with Port Technology. 2038: Future Visions builds on the award-winning book 2038: A Smart Port Story, published by INFORM in 2019.
What is 2038: A Smart Port Story?
2038: A Smart Port Story explores the terminal of the future and the intricacies of technology, and its impact on both the port industry and society. Join Douglas as he unravels the mystery around an incident at the Port of Reykjavik that sees an AGV collide with a human, leaving both of their lives hanging perilously in the balance.
Haven’t read 2038: A Smart Port Story yet? Get started with Part 1 today!
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The Athena Interviews is a series run in 2019 in which INFORM’s Matthew Wittemeier interviewed the main AI character from 2038: A Smart Port Story, Athena, about a broad range of topics surrounding AI. In an interactive video format, readers/viewers are introduced to Athena as together they explore thought-provoking questions about the future of logistics, technology, and AI.
Missed the beginning of The Athena Interviews? You can pick it up from the start at PTI Exclusive: Athena Q&A Part 1.