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The Physical Internet: Revolutionizing Sustainable Transportation Logistics

Inefficient logistics processes lead to unnecessary costs and harmful CO₂ emissions – a problem that affects not only companies but our entire environment.
The traditional, outdated structures in transport logistics exacerbate these issues and increase the pressure on our resources.

The Physical Internet (PI) offers a transformative solution: a digitally interconnected logistics system that, according to the plans of the EU Commission, opens an external URL in a new window, will optimize global and regional transport networks by 2040, reduce emissions, and utilize resources efficiently.

What is the Physical Internet?

The Physical Internet is an ambitious concept designed to fundamentally revolutionize freight transportation and logistics through an open, digitally interconnected system of systems. Its goal is to operate both global and regional transportation logistics on the basis of flexible, digitally controlled networks by 2040. In this system, vehicles, warehouses, and existing infrastructures are intelligently linked to optimize resource use and significantly reduce emissions.

“We must shift the existing paradigm of incremental change to fundamental transformation."
European Commission, opens an external URL in a new window

 

Sustainability and Efficiency Through Digital Connectivity

The digital transformation in logistics enables real-time control of the entire system. Internet of Things (IoT) devices connect all relevant elements, creating transparency and flexibility in freight management. According to an analysis by Deloitte, digitalization in logistics can help reduce CO₂ emissions by up to 30% while simultaneously increasing operational efficiency.

  • Objective: Open logistics network by 2040
  • Technology: Real-time optimization using IoT
  • Benefits: Reduction of emissions and cost savings

Horizontal Cooperation and the Role of ALICE

One of the key prerequisites for the success of the Physical Internet is the close collaboration of all stakeholders along the supply chain. Horizontal cooperation enables the optimal use of logistics resources while sustainably reducing emissions and economic burdens. This vision is supported by the European technology platform ETP ALICE, opens an external URL in a new window – an alliance that brings together leading experts and companies to develop practical strategies for a zero-emission transportation and logistics system.

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From Logistics Network to Physical Internet Networks

Insights into the Future of the Supply Chain

The Physical Internet represents far-reaching changes that go beyond mere efficiency improvements. It is a fundamental building block for a sustainable, digitized future of logistics. With the full integration of digital technologies, not only can environmental impacts be reduced, but the quality of life for those working in the industry can also be enhanced. An informative article by McKinsey demonstrates how sustainable supply chains pave the way for a more resilient economy.

Interested in further insights and practical strategies?

Learn more about the future developments in the supply chain and the opportunities they bring in our Executive MBA Future Supply Chain Management, opens in new window program (in German), and download the brochure here, opens in new window. 

About the Person
Dr. Sandra Stein heads the research division at Fraunhofer Austria Research GmbH. Her research focuses on transport logistics—particularly the Physical Internet—collaborative transport networks, integrated transport and production planning, FTI in logistics, and logistics clusters, as reflected in numerous publications. She leads various publicly funded projects, such as the Austrian flagship mobility project “PhysICAL – Physical Internet through cooperative Austrian Logistics.” She is also a faculty member of the Executive MBA Future Supply Chain Management program.