While there is healthy activity in cargo tracking and security, it is difficult to determine where the market is headed, as it hinges on whether or not a set of requirements and mandates is placed on shippers. Which entities will provide the push when there is little pull in the market, especially for increased security? Will the U.S. government be responsible for this role? Or will it be the World Customs Organization?
“Pilots and tests are being performed by the U.S. government and by commercial companies within the sector,” explains ABI Research director Michael Liard. “The defense sector wants to secure and maintain visibility of its goods, while companies in the commercial sector invest in solutions that provide visibility as well as decreased pilferage of those goods.” Other markets showing an interest in visibility and security will consist of those that ship containers with high-valued assets, or containers coming from suspicious origins that look to gain quicker entry into the United States, for example. Solutions will aim at tracking containers, as opposed to securing them.
“Closed-loop supply chains are considered potential markets; but outside of the military, few are known. Open-loop supply chains with many players need standards,” Liard continues. “Pilots will be announced and conducted over the next couple of years.” Until there are enforceable mandates, the market will move slowly, and activity will be limited. Although the U.S. Department of Homeland Security mandated the use of ISO 17712 mechanical seals for securing containers, there are no incentives in place.
“And despite the promise of ‘green lanes’ for faster customs inspections (for companies that have been certified Tier 3 under C-TPAT), these benefits have not spurred shippers into adoption,” expounds Liard.
“Unfortunately, it may take another tragic act of terrorism or major incident before the government or the WCO sets any mandates -- particularly for electronic seals, pushing the industry toward wider implementation.”
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