Modes of Transportation
By
John Hancey
Supply 361
Introduction

“...freight transportation is vital to the Nation's
economy. At any given moment, billions of
dollars' worth of goods are being moved by
truck, train, ship, or barge, or held in a yard for
transport or distribution.”
Scott Johnson, Reliability in logistics is Key to global market, Public Road Magazine
How Important is Transportation?
Tranportation's Importance to GDP
Housing
24%
Other
24%
Recreation
7%
Education
Food
7% Transportation
12%
11%
Housing
Health Care
Food
Transportation
Health Care
15%
Education
Source: Bureau of Transportation Statistics, February 2002
Recreation
Other
How is this done?
 6.3 million rail cars
 25.2 million trucks
 Over 300 ships with the capacity of 2,0005,000 containers
Purpose
 Evaluate the 4 main modes of
Transportation




Truck—semi-tractors
Rail
Ocean Carrier
Air Carrier
 Industry Trend
 Exercise
 Summary
Semi-Tractor
Semi-Tractors
 U.S Department of Transportation defines a semitruck as:
 A commercial vehicle operating on the interstate
highway system or divided highways to move
material or people for compensation
 Generally, have 3 axles—common configruation
10 wheels
 Gross combination weight rating, of 4,536 kg
(10,001 pounds) or more
Semi-Tractor Segments
 Semi-tractors segments:
 Single-axle, up to 20,000
 Tandem-Axle, up to 34,000
 Gross vehicle weight over 80,000
 Semi-Tractor lengths
 Minimum 24 and maximum 75 feet long
Truck Transportation Evaluation
 Advantages
 Greater control of over delivery locationsflexible
 Less pilferage of goods
 Last mile service
 Disadvantages
 Increase traffic congestion
 Higher rate of traffic accident
Railroad
www.freephoto.com
Railroad
 Railroad is divided
into 3 segments
 Light rail
 Rapid transit
 Freight train
Railroad Evaluation
 Advantages




Most efficient mechanized land transport
Very safe
Cheaper than trucking
Greater load capacity
Rail
Truck
100 tons
25 tons
3,500 bushel
87.5 bushel
30,240 Gallons
7,560 Gallons
Railroad Evaluation
 Disadvantages




Rigid routing destinations—inflexible
Multiple handlings of goods—leads to delays
Expensive infrastructure
Not suited for smaller loads or short distances
Ocean Freighters
Ocean Freighters
 Ocean Freighter segments
 Bulk Carriers—carry bulky
and dry items, i.e. coal or
grains
 Tanker Carriers—designed
to haul liquids, i.e. oil
 Container Carriers—carry
cargo in truck size
containers (TEU)
Ocean Freighters
 Categorized by capacity or the canals a ship
can travel through
 Handymax—smallest carrier, less than 50,000 dwt
 Aframax—tankers between 75,000-100,000 dwt
 Suezmax—largest carrier to pass through the canal,
125,000 to 200,000 dwt
 ULCC—largest tankers with displacement between
320,000 to 500,000 dwt
Ocean Freighters Evaluation
 Advantages





Cheap
Very few accidents
Best for dry and bulky items—steel or oil
Largest hauling capacity
Most efficient hauler for fuel consumption
1 ton/per gallon of fuel
Barge
Rail
Truck
514 miles 202 miles 59 miles
Ocean Freighters
 Disadvantages
 Slow
 Bad for perishable or time sensitive goods
 Limited to water routes
Air Freighters
Air Freighters
 Large modified
passenger planes that
are used to carry
freight. Most common
models are the
following:
 Boeing 747, 737,
 Airbus A320, 340
 Airbus Beluga
Air Freighter Evaluation
 Advantages





Speed of delivery-best for time sensitive items
Best for time defined deadlines
Reduces traffic congestion
Best for smaller and less bulky items
Seamless integration of plane to truck delivery solution
 Disadvantages
 Very expensive
 Not for large bulky items
 Less carrying capacity than ocean transporters
Industry Trend
 Intermodal
 Uses several types of transportations en route
 Uses a truck for pick-up and delivery, but the
long haul uses either rail/ocean
 Utilizes each modes of transportations’
efficiencies
Activity
You have received a report that your company’s new
Gazogle toy is outselling the company’s highest
expectation in the mid-west region. Store
managers in the mid-west are demanding another
shipment of Gazogle before the holiday season to
replenish their low inventory levels. As the
company’s logistic manager, you need to figure out
the cheapest method to transport the Gazogle from the
factories in China to Chicago. You must also ensure the toys
reach the mid-west stores prior to the holiday
season, which is 18 days away.
Activity Cont.
• Compute the cheapest method and route to
ship the toys from China to Chicago using
any single or combination of modes of
transportation and make sure the toys arrive
before the holiday season.
Activity Data
Transportation Data
Mode
Air Freight
Air Freight
Ocean
Ocean
Truck
Truck
Rail
Rail
•
•
Departure
Beijing, China
Beijing, China
Beijing, China
Beijing, China
Los Angeles
Seattle
Los Angeles
Seattle
Destination
Chicago
Los Angeles
Los Angeles
Seattle
Chicago
Chicago
Chicago
Chicago
Costs/unit
$ 25,000
$ 35,000
$ 10,000
$ 12,000
$ 10,000
$ 6,000
$ 8,000
$ 5,000
# of Units Req. Days
2 planes
3
2 planes
2
1 container
14
1 container
14
4 trucks
5
4 trucks
4
3 cars
4
3 cars
4
Hint: # of Units Required means that several planes, trucks or railroad cars will be needed to transport the entire
shipment.
Assume—Railroad can deliver the goods to the final destination.
Activity Solution
Mode
Air Freight
Air Freight
Ocean
Ocean
Truck
Truck
Rail
Rail
Departure
Beijing, China
Beijing, China
Beijing, China
Beijing, China
Los Angeles
Seattle
Los Angeles
Seattle
Solution
Transportation Data
Destination Costs/unit # of Units Req. Days Total Cost
Chicago
$ 35,000
2
3 $ 70,000
Los Angeles
$ 25,000
2
2 $ 50,000
Los Angeles
$ 10,000
1
14 $ 10,000
Seattle
$ 12,000
1
14 $ 12,000
Chicago
$ 10,000
4
5 $ 40,000
Chicago
$ 8,000
4
4 $ 32,000
Chicago
$ 8,000
3
4 $ 24,000
Chicago
$ 6,000
3
4 $ 18,000
Mode
Ocean-Seattle
Rail-Chicago
Total
Cost
Days
$ 12,000
14
$ 18,000
4
$ 30,000
18
Summary
• Trucking—very flexible to your needs, but
prone to accidents
• Rail—most economic land transportation,
but limited in final destinations
• Ocean—inexpensive, but slow
• Air—moves at the speed of business, but
with a cost
Final Thought
• “…quintessential requirement for
succeeding in a global, just-in-time
economy is the ability to plan trips,
deliveries, and transactions down to hours
and minutes.”
Readings
• Joseph O’Reilly, Panama Gold, Inbound logistics magazine, available at
http://www.inboundlogistics.com/articles/features/0105_feature04.shtml
• Road Information Program, America’s Rolling Warehouse, available at
www.tripnet.org/TruckingReport020904.PDF
• Scott Johnson, Reliability in logistics is Key to global market, Public Road
Magazine, www.findarticles.com
• Vineet Agarwal, Trucking has the advantage of last mile service, The
Financial Express, available at www.financialexpress.com
• U.S. Department of Transportation, Bureau of Statistics
• Library of International Marine Organization, available at
http://www.imo.org/imo/Library
• The Great Lakes St. Lawrence Seaway System - A Vital Waterway,
available at www.greatlakes-seaway.com
• Tom Piatak, “Carrier’s Corner”, Inbound Logistics magazine, October 2002