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Logistics and Intrastructure - A
Logistics and Intrastructure - A
A. A Diversity of Modes
B. Intermodal Transportation
C. Passengers or Freight?
1. Transportation Modes
■ Transport modes:
• Vehicles:
• Mobile segment.
• Supporting the mobility of passengers, freight and information.
• Infrastructures:
• Fixed segment.
• Supporting movements.
• Three basic types:
• Land (road, rail and pipelines).
• Water (shipping).
• Air.
• Each mode had a set of technical, operational and commercial
characteristics.
Performance Comparison for Selected Freight Modes
■ 1. Road Transportation
■ 2. Rail Transportation
■ 3. Pipelines
■ 4. Water Transportation
■ 5. Air Transportation
■ 6. Modal Competition
1. Road Transportation
■ Overview
• Large consumers of space.
• Lowest level of physical constraints among transportation modes.
• Environmental constrains are significant in road construction.
• Average operational flexibility (vehicles can serve several
purposes).
• High maintenance costs, both for the vehicles and
infrastructures.
• Linked to light industries (rapid movements of freight in small
batches).
1. Road Transportation
■ History
• The first land roads were trails (hunting).
• With the first nation-states trails started to be used for
commercial purposes.
• Domestification of animals such as horses, mules and camels.
• Wheeled vehicles encouraged construction of better roads.
• Requires a level of labor organization and administrative control:
• Provided by a central government offering a level of military protection
over trade routes.
• 3,000 BC the first road systems in Mesopotamia.
• Roman Empire 300 BC built the first comprehensive road network.
Roman Road (Appian Way)
1. Road Transportation
50,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
World Automobile Production and Fleet, 1965-2002
600 44
42
550
40
500 38
36
Production (millions)
450
34
Fleet (millions)
400
32
350 30
28
300
26
250 24
200 22
Fleet 20
150 Production 18
100 16
65
67
69
71
73
75
77
79
81
83
85
87
89
93
95
97
99
01
91
19
19
19
19
19
19
19
19
19
19
19
19
19
19
19
19
19
19
20
1. Road Transportation
■ Public sector
• Main supplier of road transport infrastructures.
• Unpractical to use a similar pricing system than a commercial
enterprise.
• Most roads are not economically profitable but must be socially
present as they are essential to service populations.
• Only possible on specific trunks that have an important and
stable traffic.
• Toll roads:
• Highways linking large cities.
• Bridge and tunnels.
• Can expropriate the necessary land for road construction.
• Economies of scale and their indivisibility.
1. Road Transportation
■ Costs
• Rights of passage.
• Development costs (planning).
• Construction and expropriation costs.
• Maintenance and administration costs.
• Losses in land taxes (urban environment).
• External costs (accidents and pollution).
■ Income
• Registration.
• Gas (taxes)
• Purchases of vehicles (taxes).
• Tolls, parking, and insurance fees.
2. Rail Transportation
■ Overview
• Composed of a traced path on which are bound vehicles.
• Average level of physical constrains:
• Linked to the types of locomotives.
• Affected by the gradient.
• Heavy industries are traditionally linked with rail transport
systems.
• Containerization:
• Improved the flexibility of rail transportation.
• Linking it with road and maritime modes.
2. Rail Transportation
■ Geographical setting
• Established differently because different goals were to be
achieved.
• Access to resources.
• Servicing regional economies.
• Territorial control.
■ Rail monopolies
• High level of economic and territorial control.
• Monopoly in Europe and oligopoly in North America.
• Regular (scheduled), but rigid, services.
• Transport mode the most constrained by the physiography.
Geographical Settings of Rail Lines
Nation A
Nation B
2. Rail Transportation
■ Technical issues
• Space consumption:
• Small along lines.
• Important at terminals.
• Gradient and turns.
• Vehicles:
• Very flexible in terms of vehicles and there is a wide variety of them filling
different purposes.
• Bulk, liquids, grain, containers, passengers, cattle, cars, coal.
• Gauge:
• Standard gauge of 1.4351 meters for North America and for most
Western Europe.
Domestic Rail Passenger Travel and Freight Activity, G7
Countries, 1996
United States
1979.7
United Kingdom
Japan
Italy
Germany
France
Canada
300,000 200
Rail Track Mileage 180
250,000 Class I Rail Carriers
160
140
200,000
Miles of tracks
Rail Carriers
120
150,000 100
80
100,000
60
40
50,000
20
0 0
1840 1860 1880 1900 1920 1940 1960 1980 2000
2. Rail Transportation
■ Economic rationale
• Market area and capacity:
• Transport raw materials over long distances.
• Move passengers and freight (cars, agricultural equipment, etc.)
• The average length was 1,300 km compared with 700 km for trucks.
• Intermodal integration favored segmentation and specialization.
• Costs:
• High construction and maintenance costs.
• Shipping costs decrease with distance and load.
• Transshipments and train assembly increase costs.
• Rail operating costs: labor (up to 60%), locomotives (16%) and wagons,
fuel, maintenance and equipment (24%).
2. Rail Transportation
• Benefits:
• Accelerated the industrialization process.
• Accelerated economic development and human settlements.
• Multiplier effects on industrial activities.
• Safety; after air transportation, the safest mode.
• Regulation:
• Highly dependent from government subsidies.
• Governments financing, mainly for the sake of national economic
imperatives.
2. Rail Transportation
Seoul - Busan
Tokyo - Osaka
Paris - Marseille
Madrid - Seville
London - Paris
Paris - Bruxelles
Berlin - Hannover
After
Hannover - Wurzburg Before
Firenze - Rome
0 1 2 3 4 5 6 7
3. Pipelines
■ Overview
• Single purpose: carry one commodity from a location to another.
• Built largely with private capital:
• Has to be in place before any revenues are generated; significant capital
commitment.
• Large quantities of products where no other feasible means of
transport (usually water) is available.
• Two main products dominate pipeline traffic:
• Oil and gas.
• 17% of all tons-km in the US.
• Locally pipelines are significant for the transport of water.
• Low physical constraints:
• The landscape and pergelisol in arctic / subarctic environments.
3. Pipelines
■ Pipeline systems
• Construction costs vary according to the diameter:
• Increase proportionally with the distance and with the viscosity of fluids.
• Longest pipelines:
• Gas pipeline: Alberta to Sarnia (Canada); 2,911 km.
• Oil pipeline: Transiberian; 9,344 km in length.
• Trans Alaskan pipeline:
• 1,300 km long.
• Built under difficult conditions.
• Above the ground for most of its path.
• System has very little flexibility:
• Cannot respond well to geographical fluctuations of the supply or
demand.
Trans-Alaska Pipeline
Oil and Gas Pipelines Mileage in the United States, 1960-
2003
1,600,000
Oil pipeline
1,400,000
Gas pipeline
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
4. Water Transport
■ Issues
• Dominant support of global trade:
• International and seaborne trade are interrelated.
• 96% of the world trade is carried by maritime transportation (mass).
• International trade and maritime transportation:
• Interrelated.
• 25,000 billion tons-km are on average transported annually.
• 7,000 by rail and 3,000 by road.
• 71% of all freight shipped globally.
• For every $1,000 of exports, there is one ton of freight being shipped by
maritime transportation.
International Seaborne Trade and Exports of Goods, 1955-
2001
7.0
Seaborne Trade (billions of tons of goods loaded)
6.0
Exports of Goods (trillions of $US)
5.0
4.0
3.0
2.0
1.0
0.0
4. Water Transport
Bab el-Mandab
Panama Mekong
Nile
Malacca
Amazon
Good Hope
Magellan
4. Water Transport
■ Maritime enclaves
• Countries that have difficulties to undertake maritime trade:
• Not part of an oceanic domain of maritime circulation.
• Requires agreements with neighboring countries:
• Access to a port facility through a road, a rail line or through a river.
• Not necessarily imply an exclusion from international trade:
• Substantially higher transport costs.
• On average 50% higher than countries that are not landlocked.
• Less than 40% of the trade volume of the median coastal country.
• May impair economic development.
Maritime Enclaves and Accessibility
■ Global fleet
• About 85,000 ships of more than 100 tons.
• Half of them performing transport functions and the other half
performing service functions (e.g. tugs).
• Growth of the number of ships as well as their average size.
• Oceanic maritime traffic dominantly concerns freight.
Registered World Fleet, 1914-2000
600,000 7
Number of ships
500,000 Total gross tonnage (1,000s) 6
100,000 1
0 0
1910 1920 1930 1940 1950 1960 1970 1980 1990 2000
4. Water Transport
■ Passenger vessels
• Passenger ferries:
• People are carried across relatively short bodies of water in a shuttle-type
service.
• Tend to be small and fast vessels.
• Cruise ships:
• Passengers are taken on trips of various durations, usually over several
days.
• Usually very large capacity ships.
• Before air transportation, serviced by liner passenger ships, dominantly
over the North Atlantic.
■ Roll on-Roll off (RORO) vessels
• Allow cars, trucks and trains to be loaded directly on board.
• The largest are the car carriers that transport vehicles from
assembly plants to the main markets.
Cruise Ship
Channel Ferry Ship Entering the Port of Le Havre, France
RO-RO Cargo Ship
4. Water Transport
■ Bulk cargo
• Freight, both dry or liquid, that is not packaged.
• Minerals (oil, coal, iron ore) and grains.
• Requires the use of specialized ships such as oil tankers as well
as specialized transshipment and storage facilities.
• Single origin, destination and client.
• Prone to economies of scale.
■ Break-bulk cargo
• General cargo that has been packaged in some way with the use
of bags, boxes or drums.
• Numerous origins, destinations and clients.
• Before containerization, economies of scale were difficult to
achieve.
World’s Largest Dry-Bulk Carrier, the Berge Stalh
The Regina Maersk
4. Water Transport
6000
Other
5000 Grain
Ore/coal/minerals
4000 Oil
3000
2000
1000
0
4. Water Transport
■ Technical innovations
• Size:
• Expresses type as well as capacity.
• Each time the size of a ship is doubled, its capacity is cubed.
• The largest tankers (ULCC) are around 500,000 dwt
• The largest dry bulk carriers are around 350,000 dwt.
• Remaining constraints in ship size are the capacity of ports and canals.
• Speed
• Average speed of ships is about 15 knots (1 knot = 1 marine mile = 1,853
meters), which is 28 km per hour.
• A ship can travel about 575 km per day.
• Recent ships can travel at speeds between 25 to 30 knots (45 to 55 km
per hour).
• Reaching higher maritime speeds remains a challenge which is
excessively costly to overcome.
4. Water Transport
• Specialization of ships:
• General cargo ships, tankers, grain carriers, barges, mineral carriers, bulk
carriers, methane carriers and container ships.
• Ship design:
• The hulls are the result of considerable efforts to minimize energy
consumption, construction costs and improve safety.
• A ship can take between 4 months (container and crude carriers) and 1
year to build (cruise ship).
• Automation:
• Self-unloading ships
• Computer assisted navigation (crew needs are reduced and safety is
increased) and global positioning systems.
• Smaller crews being required to operate larger ships.
4. Water Transport
■ Flags of convenience
• 46% of the ships and about 62% of the global tonnage (1998).
• Regulation:
• Under maritime law, the owner is bound to the rules and regulations of the
country of registration.
• Registry costs:
• Registry costs are on average between 30 to 50% lower than those of
North America and Western Europe.
• Operating costs:
• From 12 to 27% lower than traditional registry fleets.
• Savings are coming from lower manning expenses.
• Lower standards in terms of salary and benefits.
Tonnage by Country of Registry, 2003
China Tanker
Hong Kong Dry Bulk
Norway (NIS) Container
Other
Singapore
Cyprus
Malta
Bahamas
Greece
Liberia
Panama
0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000