A nested logit model of mode choice for inland movement of export shipments: A case study of containerised export cargo from India

Predominance of containerised mode of transport for export of general cargo has influenced the mode choices on the inland segment. Prior to containerisation the general cargo for export moved to ports invariably on road in break bulk form. Growth of containerisation led to development of inland terminals enabling an exporter to obtain export clearance at the inland points. This process facilitated an exporter to move cargo either in break bulk or in containerised form, and as inland terminals facilitated aggregation an exporter could move cargo either by road or rail. Thus containerisation increased the inland transport options for an exporter from one to three. The paper develops discrete choice models in the Indian context for inland movement of containerised export cargo. Primary data was collected from 124 export firms through a structured questionnaire. This data is supplemented with data from transport firms and terminal operators. Using the above data, a nested logit model with rail container and road truck in one branch was found to predict the mode choice behaviour best. Amongst the transport attributes, total cost and total transit time were found to be influencing the mode choices significantly. The study however did not find the effect of reliability and loss and damage significant. In addition, the model also predicts that non transport attributes - like the percentage of letters of credit that materialise with inland way bills and the value of export benefits that materialise after export - are important in the mode choice decision.