Former Amazon CEO Dave Clark says most logistics work can be automated
Weeks after mass layoffs, Flexport CEO Dave Clark says most of the company's work can be automated — it's just a 'question of time'
Dave Clark is now sole CEO at Flexport after previously sharing the job with founder Ryan Petersen.
The Amazon veteran said an "overwhelming majority" of work at firms like Flexport can be automated.
Striving for automation is common among tech-focused logistics companies, but few have delivered.
Dave Clark, Amazon's former worldwide consumer CEO, told a room full of more than 1,000 logistics experts and executives Tuesday that much of their labor could eventually be automated.
Clark is now the CEO of Flexport, a tech-enabled version of a logistics firm called a freight forwarder, which charts courses for goods to move across the world, partnering with carriers who operate ships, planes, and trucks.
Companies with goods to move pay for this service, along with customs clearance, insurance, and financing to buy the goods in the first place. Some stakeholders also pay for access to Flexport's tech products, which are meant to join the fragmented supply-chain ecosystem together.
Clark's comments came at S&P Global's TPM23 conference in Long Beach, California.
"How much work that a forwarder does can eventually be automated?" asked interviewer Eric Johnson, a director at S&P Global.
"I think over the fullness of time, you'd expect that the overwhelming majority of it should be able to be automated," Clark said. "It's a question of time."
In January, Flexport laid off 20% of its workforce. But the cuts were not the result of automation making humans obsolete, rather they were a refocus of the company's resources to speed up its technology roadmap.
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Given the slowdown in freight markets in 2023, the company needed fewer sales and customer service staff, he said. And just before Flexport's more than 600 layoffs, the company announced it was beginning an engineering hiring spree, saying it would double the number of engineers on staff this year.
"We've always had a big technology roadmap, and we're just saying, 'Let's go faster,'" Clark said.
The company, which has raised $2 billion in funding from investors like Andreessen Horowitz and MSD Partners, has nowhere near automated the process of booking and selling logistics services, which Clark fully admitted.
"Today there's a lot of high-judgment activity that occurs at the various steps of global freight movement that requires pretty incredible people to do it," Clark said. Sales is very human-dependent too, he said. "But over time, I think you would expect that most of the complexity there automates away."
The goal of automating most of the coordination — like sending emails — in the freight industry is common among venture-backed logistics technology companies. Freight forwarders and other supply chain middlemen generally have large workforces of people coordinating with both customers and carriers.
Though technology is slowly making its way into these processes and communications, the various platforms run by trucking companies or ocean shipping lines, for example, are rarely able to talk to each other. One of Flexport's main goals has been to corral all the information in these systems into one digital home to provide customers with more transparency on where their freight is.
Organizations like Uber Freight and Convoy have aimed to meet similar goals in different corners of supply chains. Automation-driven logistics technology is still receiving attention from investors despite overall trade volume and venture investment cooling.
