Mid-Continent Transportation Research Forum, Madison, WI,
August 17-18 2006
Transmodal Rail Operations and
the Thruport Concept
Jean-Paul Rodrigue, Hofstra University, New York
John Zumerchik, Mi-Jack Products Inc.
“There’s no business like flow business”
Email: ecojpr@hofstra.edu
Paper available at:
http://people.hofstra.edu/faculty/Jean-paul_Rodrigue
Integrated Transport Systems: From
Fragmentation to Coordination
Factor
Cause
Consequence
Technology
Containerization & IT
Modal and intermodal innovations;
Tracking shipments and managing
fleets
Capital investments
Returns on investments
Highs costs and long amortization;
Improve utilization to lessen
capital costs
Alliances and M & A
Deregulation
Easier contractual agreements;
joint ownership
Commodity chains
Globalization
Coordination of transportation and
production (integrated demand)
Networks
Consolidation and
interconnection
Multiplying effect
Value Per Ton of U.S. Freight Shipments by
Transportation Mode, 2002
Rail
$198
Pipeline
$241
Truck
$775
Truck and rail
$1,480
Parcel, U.S.P.S, or courier
$37,538
Air (incl. truck and air)
$88,618
Single modes
$611
Multiple modes
$4,892
All Modes
$667
1
10
100
1,000
10,000
100,000
Integrated Transport Systems
■ Resurgence in rail transportation (competitive advantages)
• Substantial growth in international trade:
• Particularly imports from Asia (China).
• Interface between global supply chains and national distribution; national
gateways.
• Growth in long distance shipments at the international and national levels.
• Rail productivity:
• Decrease in rail freight rates (35% decline between 1980 and 2000).
• Increase in trucking transport costs (wages, fuel, insurance, congestion).
• Capacity constraints at gateways:
• Containerization growing rapidly.
• Large volumes at gateways create capacity constraints.
• Intermodal rail offers a shipping alternative to the capacity constraints of
trucking.
45
60%
40
58%
35
56%
54%
30
52%
25
50%
20
15
20
04
20
02
20
00
19
98
19
96
40%
19
94
0
19
92
Los Angeles
Top 5 share
42%
19
90
Oakland
46%
5
19
88
Seattle
Long Beach
44%
19
86
New York/New Jersey
48%
10
19
84
Millions
Cargo Handled by the Top 5 US Container Ports,
1984-2005 (in TEUs)
Total
Freight in North America: Between a Gateway and
a Hard Place: Major Maritime and Land
Gateways, 2004
Land Gateways
Port of Blaine
Port of Seattle
Exports Port Gateways
Exports
Imports
Imports
$54 billion
$69 billion
Port of Sweetgrass
Port of Pembina
Port of Tacoma
Port of Champlain-Rouses Pt.
Port of Portland
Port of Alexandria Bay
Port of Huron
Port of Buffalo-Niagara Falls
Port of Detroit
Port of New York
Port of Philadelphia
Port of Oakland
Port of Baltimore
Port of Norfolk Harbor
Port of Otay Mesa Station
Port of Calexico-East
Port of Los Angeles
Port of Nogales
Port of El Paso
Port of Charleston
Port of Long Beach
Port of Savannah
Port of Morgan City
Port of Laredo
Port of Beaumont Port of New Orleans
Port of Houston
Port of Corpus Christi
Port of Brownsville-Cameron
Port of Hidalgo
Port of Jacksonville
Port of Port Everglades Port of Miami
Integrated Transport Systems
■ Transshipments
• Between (intermodal) modes and within (transmodal) modes.
• Benefits accrued at the terminals.
• ITS expanded the demands on intermodal and trans-modal
transportation alike.
• Trans-modal component of growing importance.
■ The geography of transshipments
• Connect different parts of the transport system (ITS).
• Enabling different freight markets and forwarders to better
interact.
• Conventionally at load break locations; gateways.
• Now at “logistically suitable” locations (plus added value).
Time Dependant Transport Transshipment Flows
Integrated Freight Transport System
Rail
Maritime
Transmodal operations
Intermodal Terminal
Road
Intermodal operations
DCs / CD
Thruport
Ship-to-ship
Transmodal Transportation
■ Why transmodal shipments take place?
•
•
•
•
Market fragmentation.
Supply chain fragmentation.
Ownership fragmentation.
Requirements for a high throughput trans-modal facility
■ Thruport concept
•
•
•
•
Coined by an intermodal equipment manufacturer (Mi-Jack).
“Seamless transfer of freight”.
Reduce handling and the number of container movements.
Analogy with air transport hubs:
• Consolidation and redistribution.
• Passengers “reposition” themselves.
Transmodal Transportation and Market
Fragmentation
■ Market fragmentation
Thruport
Gateway
Markets
• Mainly retail / consumption
related.
• National distribution and global
production.
• Single origin; through a gateway
and several destinations (DC).
• Thruport: reconcile the high
volume requirements of markets
with the time sensitive
requirements of distribution.
Transmodal Transportation and Supply Chain
Fragmentation
■ Supply Chain fragmentation
Thruport
1
4
2
3
3
2
4
Distribution
Parts & raw
materials
1
2
3
Manufacturing
Supply Chain
4
Customers
4
4
1
• Contemporary supply chains
involve a complex sequence of
trips.
• Specialization and comparative
advantages.
• Different stages (parts,
manufacturing, distribution);
each of which could use a
Thruport.
• Potential Thruport impact on the
locational behavior of production
and distribution activities.
Transmodal Transportation and Ownership
Fragmentation
■ Ownership fragmentation
Gateway
D
C
B
Thruport
A
• Rail companies have their
facilities and customers.
• They have their own markets
along the segments they control.
• Interchange is the major
problem.
• The Thruport creates multiplying
effects.
• The distribution potential of each
operator is expanded.
• Network alliances like in the
airline industry (constrained by
the spatial fixity of rail networks).
Minneapolis / St. Paul
13.98 M TEU
Chicago
Kansas City
St. Louis
Memphis
Dallas / Fort Worth
Transmodal Transportation and Ownership
Fragmentation
■ Local Rail Terminals Location
Metropolitan Area
CBD
• Fragmentation at transmodal
Interchange.
• Requires cross-town hauling of
containers between terminals.
• Takes place within a metropolitan
area.
• Contributes to congestion.
• Negative feedback undermines
the reliability of the transport
chain.
• The construction of new terminal
facilities in suburban areas
exacerbate the problem.
Sequence of Transmodal Rail Container
Operations: Before and After Thruport
Rail terminal
Rail terminal
Inbound
Storage Yard
Outbound
Storage Yard
Cross-town
Container
2
1
7
4
5
3
Rail Operator A (inbound)
Rail Operator B (outbound)
1 Chassis brought trackside of inbound operator A.
2 Container unloaded from the train and loaded on chassis.
Chassis/container brought to the outbound storage yard of the inbound terminal operator A for
3 delivery to outbound rail operator B.
4 Cross-town operations.
Outbound rail operator B picks up the container/chassis at the storage area and brings it
5 trackside for outbound loading.
6 Crane unloads container from the chassis and loads into the double stacked car.
7 After the container is loaded on to the double stacked car, chassis removed from trackside and
stored in an empty chassis area.
6
Thruport
Number of Lifts at Major Intermodal Rail Terminals, Chicago, 2005
Other
CN (Canadian National)
CPRS (Canadian Pacific)
CP_all
BNSF (Burlington Northern Santa Fe)
CSXT (CSX Transportation)
NS (Norfolk Southern)
Number of Lifts
UP (Union Pacific)
Global II
Less than 40,000
Global I
40,000 to 200,000
Canal Street
Cicero
200,000 to 350,000
Lake Michigan
Corwith
47th/51st Street
350,000 to 500,000
59th Street
Bedford Park
More than 500,000
Willow Springs
63rd Street
Landers / Hanjin
Illinois
Calumet
Yard Center
Moyers_Gateway
Indiana
Joliet_LPC
0
Source: US National Transportation Atlas
5
10
20 Miles
Dr. Jean-Paul Rodrigue, Dept. of Economics & Geography, Hofstra University
The Thruport Concept
■ Characteristics
• Neutral facility (preferably):
• Joint venture (rail companies, terminal operators).
• A local consortium?
• Location and setting:
•
•
•
•
At the junction of long distance rail corridors.
Linear structure of about 2.25 miles (3.6 km) in length.
Minimal interface with trucking (could be a road / rail facility).
A Thruport does not necessarily require to be located nearby a
metropolitan area.
• Performance:
• No container truck chassis and hostlers required.
• About 250 containers per hour (4,500 per day).
Mi-Jack Stack-Packer (Thruport Terminal)
Potential Thruport Sites in the Chicago Metropolitan Area
Other
CN (Canadian National)
CPRS (Canadian Pacific)
BNSF (Burlington Northern Santa Fe)
CSXT (CSX Transportation)
NS (Norfolk Southern)
UP (Union Pacific)
Thruport Site
Existing Intermodal Rail Terminal
In
di
Lake Michigan
an
a
Illinois
Wisconsin Steel
H
ar
bo
rB
e lt
Riverdale
Ra
i lwa
y
Gibson West Gibson East
US Steel
Gary
Indiana
0
5
10
Source: US National Transportation Atlas & L. Rohter (2006)
20 Miles
Dr. Jean-Paul Rodrigue, Dept. of Economics & Geography, Hofstra University
The Thruport Concept
■ Thruport implementation stages
• Impossible to fully reconcile rail distribution strategies:
•
•
•
•
Different carriers having their own schedules and frequency of service.
Long distances involved.
Possibilities of disruptions.
Uncertainties inherent to freight distribution.
• A “buffer” of temporary container storage will always be required,
even at a Thruport.
• First stage:
• Temporary buffer due to the lack of synchronization of unit trains.
• Some carriers experiment with synchronized services.
• Second stage:
• The Thruport becomes part of the operational planning of rail carriers.
• “Thruport shuttles”; unit trains assembled specifically at major gateways
for transmodal operations.
Potential Impacts of a Thruport System
Derived efficiencies
Substitution effect
Nature
Transmodal operations
Modal shift to rail
Scale
Micro (metropolitan area; city
logistics)
Macro (national; commodity chains)
Thruport
effect
Direct (transmodal benefits); less
short distance trucking
Indirect (supply chain management);
less long distance trucking
Potential
modal shift
20-40% (depending on local rail
10-20% (depending on the level of
terminal locations and configurations) market, supply chain and ownership
fragmentation); 30 to 60 million
reduction in tractor trailer originations.
Potential
energy
savings
25,000 to 50,000 barrels of diesel per 60 to 120 million barrels of diesel per
year for a large terminal (e.g.
year (United States)
Chicago)
Potential time About 1 day (30% to 50%) of
savings
transmodal operations (from 1 to 2
days currently); Less uncertainties
About 2 days for landbridge shipments
(from 5 days currently, including time
savings from derived efficiencies)
Costs/ Benefits
■ Costs
• Construction costs are expected to range from $400 to $500
million.
■ Benefits
•
•
•
•
•
•
Shippers’ Savings
Labor Productivity
Energy Consumption
Emission Reductions/Health Care
Congestion
Rail Capacity
Quantifying Benefits Will Require Baseline
Terminal Performance Metrics?
■ Transmodal performance metrics
• The benefits of the Thruport would be more quantifiable.
■ Indicators
• Percentage of TEU volume that is interchange.
• Average throughput velocity:
• rubber tire interchange
• steel wheel interchange
• Average time in-terminal for dredgeman:
• peak
• off-peak
Temperature-Sensitive Freight
Although there is a shortage of active temperature controlled containers, passive
protection has proven to be a highly effective alternative in reliable freight transport
corridors, and a major cost saver for companies making the modal shift to rail:
Food
Paints
Beer
Adhesives
Wine
Chemicals
Confectionary
Coatings
Environmental Impacts
Real estate
97 acres, far less than the 1200 acres needed for Global III in
Rochelle, IL.
Concrete
Only 7040 cu. ft., far less than the 45,000 cu. ft. used to build
Global III.
Pavement
Minimal since traffic mostly sits on the rails.
Roadway Access
Minimal beyond employee access.
Drainage
More crushed limestone; less pavement and concrete.
Noise
Coupling and decoupling of cars will be minimal, and sound
level drops off quickly for crane's warning "point source"
alarms.
Storage
No need for chassis storage and container storage yard.
Conclusion: Towards a “$100 per barrel”
Logistics?
■ The Thruport concept and Inland Freight Distribution
• Containerization insured a global freight distribution market.
• Rail bound to play a greater role; a continental ITS strategy.
• Reduce congestion for all modes by exploiting their comparative
advantages.
• The Thruport would service a niche market (transcontinental
containerized freight distribution).
• “$100 per barrel” logistics may be upon us.
• Thruport could mitigate energy cost increases.
• Unique opportunity to build more efficient intermodal
relationships between rail and truck transport systems.
“In the 20th Century, it was said, ‘distance was conquered.’
In the 21st Century, distance shall have her revenge, and
the world will become a much bigger place.”