In an article posted on FreightWaves, Jack Daleo discusses the relationship between the trends in the transportation industry and sustainability. Professionals do not believe hope is lost, but that legislative actions need to be taken in order to see prominent changes:

“Just about any time a new, groundbreaking technology takes off, comparisons to the internet are inevitable and seldom warranted. The smartphone industry, for example, could be considered a case of the latter.

But the modern mobility industry may be an even better comparison.

Transportation companies are everywhere, and they’re growing their presence more and more each year. Mobility providers, including freight forwarders, supply chain managers, asset trackers and financial services providers across sea, land and air — and even in the warehouse — have collectively garnered 12% of all venture capital funding over the last decade.

In fact, mobility startups have received more than $375 billion in venture capital funding since 2013, and they’ve grown their VC funding value twenty-ninefold between then and 2021. For the same period, VC funding value for all firms grew about ninefold.

And that investment is taking place across a web of interrelated companies, including last-mile delivery firms, electric and autonomous vehicle makers, freight forwarding companies and advanced air mobility services, geared toward getting you anything you want anytime you want it — almost like a second internet.

“When I want to know something, I know it effectively for free with access to the internet,” remarked Cyrus Sigari, co-founder and managing partner at UP.Partners. “The future that we’re hoping for is that mobility becomes its own effective internet work. I want to have something, I have it. I want to be somewhere, I’m there with very low latency, low cost, low environmental impact.”

All of the venture capital funding data above comes from UP.Partners’ inaugural Moving World Report, an extensive look at the mobility industry’s past, present and future.

The 123-page report, released Tuesday, is jam-packed with trends, insights and predictions for transportation and logistics companies, from the role of sustainability today to the emerging technologies that may power these industries decades into the future.

Here are the key takeaways from the first edition of the Moving World Report:

It won’t come as a surprise to folks who work in transportation and logistics, but UP.Partners says reining in CO2 emissions presents the mobility industry’s greatest challenge ahead.

Since 2000, global emissions from transportation have risen by one-third, the International Energy Agency has said. And per the report, citing the Energy Information Administration, the transport sector accounted for an astounding 37% of all U.S. carbon emissions in 2022, the most of any industry.

The report also paints a worrying picture of the industry’s future contributions to global emissions.

Worldwide, transport-related greenhouse gas emissions are projected to rise 11% by 2030, which may not sound like much — until you consider that the industry should be on pace to reduce them by 22% over that span in order to reach net-zero emissions by 2050, per the IEA.

“I don’t think we’re stuck,” Sigari opined. “I think there’s lots of areas to be hopeful and excited about. But it does take literal acts of Congress for the trend vector to change.”

To Sigari’s point, the Biden administration’s 2022 Inflation Reduction Act set aside more than $130 billion toward clean transportation and low-emission fuels like hydrogen or renewable batteries. At the same time, legislation like the Clean Air Act has helped nudge most major airlines to invest in cleaner fuel.

Regulators in Europe, meanwhile, are eyeing a bill that would allocate roughly $1 trillion toward energy initiatives.

Also promising is the amount of money pouring into climate tech startups — mobility firms received around 38% of all funding for that industry in 2021, UP.Partners determined based on data from Dealroom.

In fact, investment around mobility startups in general is red-hot.

As mentioned earlier, U.S. mobility startups have received over $375 billion in venture capital funding since 2013, significantly outpacing the average company. Last-mile delivery (26%) and EV companies (22%) have pulled in the greatest share of that money, per Pitchbook Data.

Citing Pitchbook Data again, however, in 2022 rising inflation and interest rates caused mobility tech stocks to lose 45% of their value, compared to 26% for the Nasdaq as a whole, in part due to the high number of SPAC companies in the space. Mobility firms also saw a 48% dip in VC funding value between 2021 and 2022, compared to 34% for all companies.

But Sigari and UP.Partners view that decline as more indicative of a flurry of activity in 2021 than a sign of weakness in 2022. Sigari pointed out that late-stage mobility deal sizes and valuations have regressed closer to 2020 levels, and early-stage valuations actually rose from 2021 to 2022.

“I think ’21 was not normal. It just wasn’t rational,” Sigari said. “And I think rather, what it did was create irrational behavior downstream. And so this is definitely reality jumping in, saying, ‘Hey, there’s companies that were being acquired or going public that just had no business doing that.’””

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