Urban delivery industry response to cordon pricing, time-distance pricing, and carrier-receiver policies in competitive markets

The paper develops a set of analytical formulations to study the behavior of the urban delivery industry in response to cordon time-of-day pricing, time-distance pricing, and comprehensive financial policies targeting carriers and receivers. This is accomplished by modeling the behavior of receivers in response to financial incentives, and the ensuing behavior of the carrier in response to both pricing and the receivers’ decisions concerning off-hour deliveries. The analytical formulations consider both the base case condition, and a mixed operation with both regular hour and off-hour deliveries; two pricing schemes: cordon time of day, and time-distance pricing; two types of operations: single-tour, and multi-tour carriers; and three different scenarios in terms of profitability of the carrier operation, which include an approximation to the best case, the expected value, and the worst case. The analyses, both theoretical and numerical, highlight the limitations of pricing-only approaches. In the case of cordon time of day pricing, the chief conclusion is that it is of limited use as a freight demand management tool because: (1) in a competitive market the cordon toll cannot be transferred to the receivers as it is a fixed cost and (2) the structure of the cost function, that only provides an incentive to the carrier to switch to the off-hours when all the receivers in the tour switch to the off-hours. The analyses of time-distance pricing clearly indicate that, though its tolls could be transferred to the receivers and provide an incentive for behavior change, the magnitude of the expected toll transfers under real life conditions are too small to have any meaningful impact on receivers choice of delivery times. In essence, the key policy implication is that in order to change the joint behavior of carrier and receivers, financial incentives—or programs that foster unassisted off-hour deliveries—should be made available to receivers in exchange for their commitment to do off-hour deliveries. As the paper proves, if a meaningful number of receivers switch to the off-hours, the carriers are likely to follow suit.     

A time-dependent freight tour synthesis model

This paper introduces a model of urban freight demand that seeks to estimate tour flows from secondary data sources e.g., traffic counts, to bypass the need for expensive surveys. The model discussed in this paper, referred as Freight Tour Synthesis (FTS), enhances current techniques by incorporating the time-dependent tour-based behavior of freight vehicles, and the decision maker’s (e.g., metropolitan planning agency planner) preferences for different sources of information. The model, based on entropy maximization theory, estimates the most likely set of tour flows, given a set of freight trip generation estimates, a set of traffic counts per time interval, and total freight transportation cost in the network. The type of inputs used allows the assessment of changes in infrastructure, policy and land use. The ability of the model to replicate actual values is assessed using the Denver Region (CO) as a case study.     

Impacts of information technology and urbanization on less-than-truckload freight flows in China: An analysis considering spatial effects

Understanding the relationship between socioeconomic factors and the Less-than-Truckload (LTL) freight flows is important for transportation planners and policy makers. This paper explores the impacts of information technology, urbanization on LTL freight flows by using a spatial autocorrelation model with freight flow data from a leading LTL company in China. The results show that all IT variables and urbanization variables have positive effects on freight flows. Distance, as expected, is negatively correlated with the freight flow volume. The application of the spatial autocorrelation model further shows that origin dependence, destination dependence and OD dependence are all significant, justifying the consideration of spatial interdependence. Finally, policy implications are discussed based on the estimated results. These findings shed light on the impacts of internet and urbanization on freight transportation, and contribute to the design of freight policies and the development of the LTL industry.     

Rebound effects in UK road freight transport

This paper analyses aggregate time-series data to estimate the direct rebound effect in UK road freight over the period 1970–2014. We investigate 25 different model specifications, conduct a comprehensive set of diagnostic tests to evaluate the robustness of these specifications and estimate the rebound effect using three different elasticities. Using the mean of the statistically significant estimates from these specifications, we estimate a direct rebound effect of 61% - which is larger than previous estimates in the literature and almost twice as large as the consensus estimate of direct rebound effects in road passenger transport. Using the mean of the estimates from our most robust models, we estimate a slightly lower direct rebound effect of 49%. Our estimates are fairly consistent between different model specifications and different metrics, although individual estimates range from 21% to 137%. We also find that an increasing proportion of UK road freight is being undertaken by foreign registered vehicles, and that increases in the vehicle weight limits have encouraged more freight activity. We highlight the significant limitations imposed by the use of aggregate time series data and recommend that further studies in this area employ data from vehicle use surveys.     

A cost and CO2 comparison of using trains and higher capacity trucks when UK FMCG companies collaborate

Companies working in a collaboration are able to achieve higher vehicle capacity utilisation and reduced empty running, resulting in lower costs and improved sustainability through reduced emissions and congestion. Collaboration produces higher volumes of goods to be moved than individual companies which means that further efficiencies may be possible by relaxing the freight mode constraints and considering rail and higher capacity vehicles. This paper explains how real world data has been used in a model to quantify the economic and environmental benefits in the FMCG sector delivered through collaboration utilising road and rail freight modes. Data for one month was provided by 10 FMCG companies and included freight transport flows between depots and customers, inter depot movements, and supplier collections. Detailed road and rail costs and operating characteristics were obtained and, with the transport flows, applied to a network design model which was used to validate the company data sets. A strategy examining the potential use of alternative higher capacity vehicles and rail for the flows between nine regional consolidation centres showed cost and CO₂ savings. Just under half the inter-regional flows benefited from double deck trailers, longer heavier vehicles for 30% of the flows and rail with different wagon configurations for the rest. In summary there was a 23% reduction in cost with 58% fewer road kilometres and a 46% reduction in CO₂ emissions. The ability to backhaul the same mode of transport between most of the regional centres was one of the strengths of this strategy.     

Modelling mode choice for freight transport using advanced choice experiments

In this paper we use advanced choice modelling techniques to analyse demand for freight transport in a context of modal choice. To this end, a stated preference (SP) survey was conducted in order to estimate freight shipper preferences for the main attributes that define the service offered by the different transport modes. From a methodological point of view, we focus on two critical issues in the construction of efficient choice experiments. Firstly, in obtaining good quality prior information about the parameters; and secondly, in the improved quality of the experimental data by tailoring a specific efficient design for every respondent in the sample.With these data, different mixed logit models incorporating panel correlation effects and accounting for systematic and random taste heterogeneity are estimated. For the best model specification we obtain the willingness to pay for improving the level of service and the elasticity of the choice probabilities for the different attributes. Our model provide interesting results that can be used to analyse the potential diversion of traffic from road (the current option) to alternative modes, rail or maritime, as well as to help in the obtaining of the modal distribution of commercial traffic between Spain and the European Union, currently passing through the Pyrenees.     

The potential demand for a urban freight consolidation centre

This paper reports the results of a stated-preference study aimed at investigating how transport decisions are made by receivers or by transport operators about the potential use of an urban freight consolidation centre in the city of Fano, Italy. Because there are no revealed preference data, a stated-choice methodology is used. The stated-choice experiments present two alternatives—one using a private vehicle subject to various traffic regulations and one using the urban freight consolidation centre with varying cost and efficiency levels. Conventional discrete choice data modelling shows that the potential demand is influenced mainly by the distance of the parking bay from the shop, by access permit cost, by the service cost of the urban freight consolidation centre, and by the delay in delivery time. Simulations are then performed to assess how the potential demand is affected by various incentives and regulations affecting urban goods distribution.

Freight Data Assembling and Modeling: Methodologies and Practice

Abstract

In comparison to personal travel, freight movements within large metropolitan areas are much less studied. Most conventional transportation models and planning analysis that disregarded freight flows have been criticized on the plausibility of their results and conclusions. To alleviate these problems, this study proposes a non-survey based approach to assemble and process freight data in a systematic way. A freight origin–destination (OD) matrix of freight flows can be developed using secondary data sources. The estimated freight flows can be loaded together with conventional passenger flows onto the regional highway network of a large metropolitan area. As a case study, this non-survey based approach was applied to build a freight OD and study the traffic flows in Los Angeles. It concluded that this approach can be used to analyze urban freight movement in a low-cost way in which planning agencies can overcome the common omission of freight flow information in their transportation plans.     

The Impact of Urban Freight Transport: A Definition of Sustainability from an Actor's Perspective

Abstract

This paper presents a definition of sustainable urban freight transport (SUFT), based on the existing theories and concepts, and develops an indicator set that describes SUFT. The definition of SUFT makes a categorisation of actions possible which enables actors to select effective strategies towards SUFT. The indicator set consists of two levels: impact indicators – which describe how the urban freight transport violates the principles of sustainability; and performance indicators – which describe different categories determining the characteristics and performance of the urban transport system. A literature study analyses the characteristics determining the performance of actors in the urban freight transport chain. Knowing the current state and improvement potential of the urban freight transport system are prerequisites for defining successful strategies and implementing effective actions.     

A model of managers’ preferences for location of freight facilities

The paper reviews the need for a better understanding of the factors which affect the location of freight facilities, such as depots, terminals, freight forwarding centres, distribution centres, etc. The development of an Elimination by Aspects (EBA) model to analyse such location decisions by the managers of freight firms is described. The results are shown to be comparable (perhaps even superior to) those obtained with a logit model. Conclusions are drawn with respect to both the use of the EBA model to analyse freight facility location preference, and the factors which affect such preference. Five factors were found to be significant: closeness to existing customers, closeness to arterial roads, availability of suitable sites, cost of truck fleet operation, and closeness to labor.     

Estimating potential reductions in externalities from rail-road substitution in Trans-European freight transport corridors

This paper develops a method for analysing and estimating savings in externalities that could be achieved by substituting truck with rail freight services in a given Trans-European freight transport corridor. The externalities affected include energy consumption, emissions of greenhouse gases, noise, congestion, and traffic incidents/accidents. The European Commission transport policy aims to provide an institutional framework for the medium- to long-term sustainable development of the transport sector. An important aspect of this policy is to stimulating the modal shift from truck to rail freight transport in inland Trans-European corridors.     

Evaluating the environmental impacts of online shopping: A behavioral and transportation approach

Various fields and commercial sectors have witnessed a transformation with the advent of the internet. In the last decade, the retail sector in particular has witnessed the massive growth of e-commerce. This has also significantly altered our shopping experiences, influencing a range of decisions, from where, how, and how much to shop. With the consistent growth of e-commerce transactions, more trucks than ever before are entering cities today, bringing with them the negative externalities of increased congestion and pollution. This study first unravels underlying shopping behaviors–both in-store and online–using the 2016 American Time Use Survey (ATUS) data. The authors also develop an econometric behavioral model to understand the factors that affect shopping decisions. At a macro level, the disaggregate individual shopping behaviors are studied by implementing the model to synthetic populations to estimate potential vehicle miles traveled and environmental emissions in two metropolitan areas, Dallas and San Francisco (SF). Finally, the study estimates the impacts of rush deliveries, basket size, and consolidation levels by developing a breakeven analysis between in-store and online shopping. These results confirm the importance of managing the urban freight system, including delivery services and operations, to foster a more sustainable urban environment.     

Economic valuation of Well-To-Wheel CO2 emissions from freight transport along the main transalpine corridors

CO₂ emissions are one of the main externalities related to freight transport. Their evaluation is extremely difficult, due to the presence of several scientific and economic uncertainties. This paper discusses the approaches currently adopted by literature to deal with CO₂, proposing a methodology based on a Well-To-Wheel quantification and an economic valuation deriving from a meta-regression. A freight transport analysis is then provided for one of the most critical areas of Europe, the Alps. Here, the different approaches adopted by the single nations determine divergent results in terms of modal shift towards rail and, consequently, CO₂ emissions. An integrated and transnational strategy could lead to better results, avoiding detoured traffic and increasing the share of railway traffic. To this aim, the carbon impacts of three specific alpine-wide measures are evaluated: namely, Alpine Crossing Exchange, Emissions Trading and Differentiated Toll System. In comparison with business-as-usual scenario, the case study reveals a potential CO₂ saving up to more than 600,000 tons and 38 M€ for the year 2030, thus providing policy makers with an integrative transnational tool able to evaluate the long-term carbon impact of their transport decisions.     

Impacts of trade related sustainability strategies on freight transportation: Modelling framework and application for France

The circular and functional economies are being presented in the literature as potential strategies for future sustainable societies. In terms of the consequences for supply chains, they will promote a much more dispersed and diversified, local and network based usage of goods than the current economy, which is comparatively linear, concentrated, long distance oriented and scale economy based. A gap in the literature is the assessment of the effects of these systems on freight transport flows. In our paper, we present a first attempt at estimating this impact using freight transport scenario building and quantitative modelling. In order to translate the main parameters that characterize these systems into factors determining freight transportation volumes, we develop a framework based on a typology of goods categories describing functional and spatial proximity between producers and consumers. In order to simulate changes in the economy, we develop scenarios for the shifting of goods from one category to another and, additionally, include internalization policies that should guide their realization. We calculate the impacts on freight flows using a new interregional transport model for France that includes distribution chains and produces estimates of external costs of transport. Our results show that circular and functional economies could lead to a 2–5% reduction of air pollutant emissions and up to a 14–26% reduction if combined with the internalization of external costs. The scenario with ongoing mass production for differentiated demand is found to lead to a 5% increase of environmental impacts compared to the baseline.     

A Stated preference freight mode choice model

Transport policy aims to assist the transport system to work more efficiently and effectively. An understanding of the reasons why people choose to move freight in a certain manner is critical to the development of appropriate policies. This article outlines a data collection approach and the development of a disaggregate mode choice model applicable to the analysis of freight shipper decision making. It focuses on the choice between rail and road in Java, Indonesia. The model indicates that safety, reliability and responsiveness are major attributes influencing rail/road freight mode choice. Transport policies aimed at improving these dimensions should increase the attractiveness of rail transport.     

Assessing the energy and greenhouse gas emissions mitigation effectiveness of potential US modal freight policies

This paper estimates the total embodied energy and emissions modal freight requirements across the supply chain for each of over 400 sectors using Bureau of Transportation Statistics Commodity Flow Survey data and Bureau of Economic Analysis economic input-output tables for 2002. Across all sectors, direct domestic truck and rail transportation are similar in magnitude for embodied freight transportation of goods and services in terms of ton-km. However, the sectors differ significantly in energy consumption, greenhouse gas emissions, and costs per ton-km. Recent pressure to reduce energy consumption and emissions has motivated a search for more efficient freight mode choices. One solution would be to shift freight transportation away from modes that require more energy and emit more (e.g., truck) to modes that consume and emit less (e.g., rail and water).Our results show there are no individual sectors for which targeting changes would significantly decrease the total freight transportation energy and emissions, therefore we have also looked at the prospect of policies encouraging many sectors to shift modes. There are four scenarios analyzed: (1) shifting all truck to rail, shifting top 20% sector mode choice, (2) based on their emissions, (3) based on a multi-attribute analysis, and (4) increasing truck efficiency (e.g., mpg). Increasing truck efficiency by 10% results in similar energy and emissions reductions (approximately 7% for energy and 6% for emissions) as targeting the top 20% of sectors when selected based on emissions, whereas selecting the top 20% based on availability to shift from truck results in slightly less reductions of energy and emissions. Implementing policies to encourage higher efficiency in freight trucks may be a sufficient short term goal while efforts to reduce truck freight transportation through sectoral policies are implemented in the long term.     

Regulatory reform and freight mode choice

Reform of trucking Vehicle Weights and Dimensions (VWD) regulations in Canada is now underway. The effect these reforms will have on the freight transportation industry are only recently the subject of research. This paper is part of this new research effort, aimed at understanding how regulatory reform in the trucking sector will affect the existing competitive relationship between trucks and the railways. The paper presents the results of study and research into modelling the relationship between mode choice and the service characteristics that are affected by VWD reform.Using several periods of data, a series of econometric models are developed which help to elucidate the relative relationships between the mode service characteristics for both of the principal interprovincial freight modes. A technique is developed and presented to model railway user costs in order to overcome the complex and often unrepresentable pricing activities of Canadian railways.The strength of the developed econometric models is presented, including their significance and statistical reliability. This is further reinforced by the similarities exhibited by all the models in the series. The selected model is applied to predict market service responses required of the railway industry in order to compete with the trucking sector now adapting to the new regulations.The impact of the newly implemented vehicle weight and dimension reform on the rail transportation industry is analyzed and railway industry improvements aimed at maintaining its market share are presented. The results predicted by the model show that railway user cost reductions should be moderate, and likely less than the level of inflation over the period of time when trucking converts its fleet to take advantage of the new regulations.Abbreviations AASHTO American Association of State Highway and Transportation Officials - CCMTA Canadian Conference of Motor Transport Administrators - EPI End products, inedible commodity classification - GVW Gross Vehicle Weight - NA 1988 VWD National Agreement - RTAC Roads and Transportation Association of Canada - VWD Vehicle Weight(s) and Dimension(s) - WA 1988 VWD Western Agreement     

Individual freight effects,capacity utilization,and Amtrak service quality

This paper offers a new perspective on the post-deregulation rail industry. We hypothesize that a link exists between individual freight effects and Amtrak service quality. Specifically, we investigate the relationship between freight control of the infrastructure on which Amtrak trains operate and Amtrak train delays. Our sample consists of 1117 directional station-pairs for fiscal years 2002 through 2007 on 28 Amtrak non-Northeast Corridor passenger routes. We found that freight effects have a significant impact on Amtrak train delays after controlling for other important delay determinants such as the capacity utilization rate. The impact is higher on long-distance routes. We also observed significant differences between the effects of different freight railroads. For example, Amtrak operations on infrastructure controlled by several Class I railroads experienced significantly larger delays than baseline operations, while Amtrak train delays on Burlington Northern and Santa Fe’s tracks actually fell below baseline levels.     

Nature or nurture: why do railroads carry greater freight share in the United States than in Europe?

During the 1950s, the share of freight carried by railroads was similar and declining in both the United States and Europe. By 2000, the railroads’ share of freight (measured in ton–kilometers) had reached 38% in the United States while falling to 8% in Europe. This paper examines the reasons for the difference in rail’s share of freight in Europe and the United States. We find that almost 83% of the gap in 2000 is probably due to natural or inherent differences, principally geography, shipment distance, and commodity mix. However, 17% of the gap cannot be explained by these inherent differences and is presumably due to public policies including priority of passenger service, lack of interoperability at borders, service quality and rates, and incentives of the rail operators. We estimate that if that policy gap were closed, railroads’ share of freight in Europe would increase from 8% to 13%.

The European freight railway system as a hub-and-spoke network

This paper addresses a hub-and-spoke network problem for railroad freight, where a central planner is to find transport routes, frequency of service, length of trains to be used, and transportation volume. Hub-and-spoke networks, often found in air freight, have not been favoured by railways in the past. Such a structure could be profitable, however, if there exist concentrated freight flows on some service links. We formulate a linear integer programming model whose objective function includes not only the typical operational cost, but also cost due to the transit time spent by freight in the network. We then develop heuristic algorithms to solve large scale instances occurring in rail freight systems in France plus Italy; Germany; and a 10-country European network. By assuming that every node is equipped with consolidation capability, we let the final solution naturally reveal potential hub locations, the impact of several of which is studied by sensitivity analysis.