Multimodal Transport

Lecturer: Tran Thi Ngoc Duy

 Multimodal Transport
Content
Chapter 1: Overview of multimodal transport
Chapter 2: Modes of transport in multimodal transport
Chapter 3: Multimodal transport operation
Chapter 4: Customs clearance in multimodal transport
Chapter 5: Cargo Insurance in Multimodal transport
 Chapter 1: Overview of multimodal transport

1. Introduction of transport
1.1. Definition of transport
Transport is the actual movement of goods from one location
to another using a means of or a vehicle of transport (e.g.
trains, trucks, boats) and a transport infrastructure (e.g. roads,
railways, cannals) (Tolga Bektas, 2017).
1.2. Actors in transport
⎼ Shippers
⎼ Carriers
⎼ Intermediaries: freight forwarder

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1. Introduction of transport
1.3. Modes vs means of transport

⎼ Water (ships in oceans, ⎼ Vessel, barges, ..

barges in rivers) ⎼ Plane
⎼ Air ⎼ Truck
⎼ Land (road, rail, off- ⎼ Train
road)
⎼ Others: pipelines, cable
transport

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1. Introduction of transport
1.3. Modes vs means of transport

(Tolga Bektas, 2017)

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1.4. Advantages and disadvantages of each mode of transport

v Sea transport

Advantages Disadvantages
⎼ Sea transport ⎼ Slow speed
⎼ High volume, Bulk cargo ⎼ Risky
⎼ Eco – friendly
⎼ Long lead – time
⎼ Reasonably freight
⎼ Transport of perishable goods

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1.4. Advantages and disadvantages of each mode of transport

v Road transport

Advantages Disadvantages
⎼ Cost effective ⎼ Traffic jam
⎼ Fast delivery ⎼ Accident
⎼ Door to door service
⎼ Flexible

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1.4. Advantages and disadvantages of each mode of transport
v Air transport
Advantages
⎼ High speed, quick service
⎼ Natural route
⎼ Transport of perishable
goods, emergency,
seasonable, valuable …
⎼ Safe
Disadvantages
⎼ Costly
⎼ Limited capacity
⎼ Huge investment
⎼ Targeted by terrorism
⎼ Limited range of goods
⎼ Complicated customs
procedure
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1.4. Advantages and disadvantages of each mode of transport

v Rail transport

Advantages Disadvantages
⎼ Cost effective for long-haul ⎼ Requires a large investment
⎼ High capacity, good for bulk of capital.
cargo ⎼ Lack of flexibility
⎼ Safety ⎼ Uneconomical for short
distances and small traffic of
goods

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2. International transport
2.1. Definition
International transportation is the movement of goods or
people from one country to another.
2.2. Right of transport

The party who is responsible for Right of transport

paying the freight and organizing
the carriage of goods

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2.2. Right of transport

- Buyer wins the transport right

• Pay the seller the price of the goods at the place of the
seller
• Pay the cost of carrige to bring the goods from the seller
place to the named place of destination (the buyer’s
country)
• Organizes the carriage of the goods from the seller’ s
country to the buyer’s country.

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2.2. Right of transport

- Seller wins the transport right

• The buyer pays the seller the price of the goods (freight
included)
• The seller organizes the carriage of the goods to the
named place of destination (the buyer’s country)

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2.2. Right of transport

How to determine the right of transport?

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2.2. Right of transport

Why is it necessary to win transport right?

⎼ For the sellers/ buyers
• Select reliable carriers,
• Negotiate the terms of the charter party with favorable
conditions
• Be proactive in organizing the transportation and delivery
of the goods.
⎼ For the countries
• Develop the domestic transportation industry.
• Reduce foreign currency spending and increase foreign
currency revenue

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2.2. Right of transport

Some situations that the buyer/seller shoud avoid the transport

right:
• Freight rate tend to increase (compared to the time of
signing the contract)
• The price difference does not cover the freight difference
(FOB and CFR)
• Don’t have knowledge of chartering
• Need to sell or need to buy goods that the other party wants
to win the transport right
• National law

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3. International Multimodal Transport

3.1. Definition
⎼ Multimodal transport refers to the transportation or carriage of
goods from point A to point B by at least two different models
of transport.
⎼ “International multimodal transport is the carriage of goods by
at least two different modes of transport on the basis of a
multimodal transport contract from a place in one country at
which the goods are taken in charge by the multimodal
transport operator to a place designated for delivery situated in
a different country” (the MT Convention, 1980).

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3.2. Characteristics of international multimodal transport
⎼ Using at least 2 different modes of transport
⎼ A single document of carriage (multimodal transport bill of
lading)
⎼ One operator (Multimodal transport operator - MTO)
⎼ The carriage of goods between two or more countries
(Source: Singapore Logistics Association)

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3.3. Differentiate some terms
⎼ Multimodal transport vs intermodal transport:
• Intermodal freight transport is the concept of utilizing
two or more ‘suitable’ modes, in combination, to form
an integrated transport chain aimed at achieving
operationally efficient and cost-effective delivery of
goods in an environmentally sustainable manner from
their point of origin to their final destination (………..)
• Intermodal transport: use of several modes of transport
• Goods remain in the same loading unit
• Without intermediate handling

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3.3. Differentiate some terms

⎼ Unimodal transport: transportation of goods using one mode of

transport.
⎼ Bimodal transport: Carriage of goods by two modes of
transport
⎼ Combined transport
⎼ Segmented transport

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3.4. Advantages of multimodal transport

⎼ Save cost
⎼ Reduce risk of loss or damage at transhipment points
⎼ Multiple documentation and other formalities reduced
⎼ Minimizing confusion (single point of contact)
⎼ Speedy transit time
⎼ Reduce cost of export

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3.5. Requirements for the development of multimodal transport
⎼ Infrastructure
⎼ Legal basis
• Multimodal liablity regime
• Customs procedures

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3.5. Requirements for the development of multimodal transport

v Infrastructure
- Unit load
• Container
• Pallet
• Swap body
• Semi trailer
• ULD

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Container

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Pallet

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Road trailer/Semi trailer

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Swap-body (Rail/road)

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ULD (Unit loading device)

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3.5. Requirements for the development of multimodal transport

v Infrastructure
⎼ Sea port
• Container terminal
• Apron
• Wharf
• Container Freight Station (CFS)
• Container yard (CY)
• Container handling crane, container forklift, …
⎼ Inland Clearance Deport (ICD)

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Container terminal

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Container gantry crane - Container stacking crane

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Forklift - Spreader

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Kangaroo-system

Both trucks and trailers are transported by rail.

(https://www.youtube.com/watch?v=vPx2A_QERFM)

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3.6. Combining modes of transport

v Sea – air
⎼ Faster than sea, cheaper than air.
⎼ Sea air can cost as much as 40% to
50% less than pure airfreight.
⎼ Sea-air service is ideal for transporting
high value items, high seasonal demand.

Vessel Plane

Sea port Sea port Destination

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3.6. Combining modes of transport

v Air – road (truck)

⎼ This combination is featured by air carriage and road
transport.
⎼ Many airlines provide road feeder services (RFS).
⎼ Airlines can provide road transport using their own
vehicles, or highway common carriers will do so.

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3.6. Combining modes of transport

v Rail/Road/Inland Waterway - Sea - Rail/Road/Inland

Waterway

Rail/road ILW Sea

Cambodia Phnom Penh Cai Mep
(Shipper’s Port Port Mỹ
warehouse) (Vietnam)

Road Road
ILW
(truck) Tây Ninh (truck)
Cai Mep Thi Vai ICD
Port Transimex Cambodia

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3.6. Combining modes of transport

v Land – sea – land

Empty container

Road Rail/road Sea Road (truck)

Shipper’s
Sea port Sea port Rail-head
warehouse

Road (truck)

Consignee’s
warehouse

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3.6. Combining modes of transport

v Sea train
This mode of transportation uses a rail car that is transported by
sea to the destination country where it is again connected to the
railway to complete delivery to the consignee

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3.6. Combining modes of transport

v Ro-Ro (Roll – on Roll-off)

The ro-ro mode combining sea and road, is usually used to
transport new cars. Shipped by sea, the cars are then driven off
the vessel to the importer’s warehouse or to a free trade zone
(FTZ) . Heavy and oversized cargo is suitable for ro-ro transport.
(https://www.youtube.com/watch?v=yMs94VRJqiw)

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v Lash (lighter aboard ship)
ILW
(lighter) LASH
Rotterdam Sea port
Rhine river (Mississippi) Destination
(Germany) Port
Atlantic

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3.6. Combining modes of transport

v Landbridge
Containers are shipped overland as part of a sea – land route in
the land bridge system of transport.
Road Sea
Sea (vessel)
(train)
(vessel) New York
China Los Angeles
Hamburg

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Landbridge - Trans Siberian Railway

Trans Siberian Railway

Europe
Far Estern
Landbridge

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Landbridge - Trans Siberian Railway

13,000 km vs 21,000 km

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3.6. Combining modes of transport

v Minibridge
A container is moved on a vessel from a port in one country to a
port in the destination country. The containers are then moved by
rail to a second port in the destination country.
Sea Road
(vessel) (train)
Mumbai NewYork Colorado

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3.6. Combining modes of transport
v Microbridge
Road
Sea
(train)
(vessel) Salt Lake
HongKong Los Angeles
City

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3.6. Combining modes of transport
v Piggyback
- Combination of transport by road and rail
(https://www.youtube.com/watch?v=bNQh5IIzbGw)

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How to select the transport mode?

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3.7. Multimodal Transport Operator (MTO)
⎼ Definition
MTO means any person who on his own behalf or through
another person acting on his behalf concludes a multimodal
transport contract and who acts as a principal, not as an agent
or on behalf of the consignor or of the carriers participating
in the multimodal transport operations, and who assumes
responsibility for the performance of the contract (United
Nations Convention on International multimodal transport of
goods 1980 – MT Convention)

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3.7. Multimodal Transport Operator (MTO)

⎼ Types of MTO
• Vessel operating MTO (VO-MTO)
• The non-vessel operating MTO (NVO-MTO)

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3.7. Multimodal Transport Operator (MTO)

⎼ Types of MTO
• Vessel operating MTO (VO-MTO)
This MTO typically does not own or operate the road, rail
or air modes of transport, but he can make arrangements
for them by sub contracting that particular segment.

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3.7. Multimodal Transport Operator (MTO)

⎼ Types of MTO
• Non-vessel operating MTO (NVO-MTO)
ü Is a transport operator who does not own an ocean
vessel, although he may own some means of transport
such as truck.
ü Generally, he sub-contracts the inland, sea or air legs of
the operation.
ü A freight forwarder is also an NVO MTO

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3.8. Scope of services
⎼ Full container load (FCL)
⎼ Less than container load (LCL)/consolidator
• General consolidator: LCL (many sellers) - LCL (many
buyers)
• Buyer’s consolidator: LCL(many sellers) – FCL (one buyer)
• Shipper’s consolidator: FCL (one seller) - LCL (many
buyers)

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3.8. Scope of services

⎼ Other activities
• Packing
• Customs clearance, export and import formalities, foreign
exchange transactions.
• Issuing multimodal transport document
• Booking of space
• Customs liaison
• Insurance coverage
• Return of leased containers
• Communication

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Packing
Verified Gross Mass (VGM): went into effect on 1 July, 2016.
(The Safety of Life at Sea convention, SOLAS (1980)).

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MSC Napoli was a United Kingdom- flagged container ship that developed a hull
breach due to rough seas and slamming in the English Channel on 18 January
2007. She was deliberately run aground at Lyme Bay to avoid an environmental
disaster and broken up by salvors.

Investigation and report

This was due to the loading on the structure due to the ship, containers and the
rare sea state exceeding the capacity of the hull girders in this area. No
deficiencies were found in material or construction and the earlier grounding in
2001 did not contribute to the loss. 54
3.9. MTO with intervening parties

Scope of services MTO with intervening parties

⎼ Carriers (ship owners, road transport operators, railways,
airlines, inland waterway transport operator).
⎼ Organizations at sea port: container terminals, port operators,
CFS, CY, customs authorities, packing.
⎼ Other parties: banks, insurers, exchange control authorities,
government agencies.

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