Land and Multimodal

Transportation I

SCM3604 – Lecture 9
The Hang Seng University of Hong Kong

2022/23

© HSUHK 1
 Learning Objectives

1. Advantages and limitation

2. Truck Transportation
3. Rail Transportation
4. Freight Forwarders
5. Alternative Means of Transportation
6. Freight Distribution and Network Strategies

2023/24 - SCM3604 © HSUHK 2

 Truck Transportation
• Trucks
– Trucks have:
• different configurations (size, number
of axles, length) in different countries.
• different weight limits.
Previous Policies
• Four-up-four-down rule – Required
driver, truck, trailer, and container
must all enter the Mainland and
return to Hong Kong as one
ensemble.
• “四上四落”限制 - 即司機、拖頭、拖
架及貨櫃必須一併進入內地和一併返回香
港

• Road
– There are various restrictions (e.g.
weight and speed) on road
transportation in different countries.
– Uses of roads are often free of
charge.

2023/24 - SCM3604 © HSUHK 3

 Truck Transportation
Advantages Limitations
• Relatively fast on land transportation • Relatively ineffective on carrying
bulky and heavy cargoes
• Low capital cost (easy market entry) • Relatively expensive per unit
• Flexible on routes, destinations, • Congestion and parking difficulties
frequency of departure
• Compete with passengers' transport
on public infrastructures

Articles Cross-Border E-Commerce – HKTDC news

Mainland Cross-border E-Commerce Opportunities for Hong Kong

Businesses

US-China trade war: how Hong Kong workers are getting caught in the
crossfire of tariff spat between global superpowers – Mar 2019

2023/24 - SCM3604 © HSUHK 4

 Truck Transportation

• Types of trucks
– Pickups
– Vans
– Lorries
– Trailer-trucks (chassis)

2023/24 - SCM3604 © HSUHK 5

 Container, Chassis, Trailer, Tractor

2023/24 - SCM3604 © HSUHK 6

 Truck Transportation
• Truck Transportation
– Due to the various capacities of trucks, and flexibilities of routes and
departures, it is possible and important to make combinations to
achieve maximum utilization rate (thus lowest cost)
– There are commercial computer applications for said purposes.

2023/24 - SCM3604 © HSUHK 7

 Truck Transportation
• IBM Truck Utilisation Formula
– Truck utilization is the percentage of a truck's capacity that is filled
with product.

Example of Frequency
• There is a Customer called Cleveland, with a Shipment Profile that refers to a
Product Grouping called All Soda Types. The Measurement Type is set to
Frequency
• The Demand for All Soda Types in Cleveland is 840,000 pounds in the model.
The model is divided into 12 Time Periods of equal length.
• The Cleveland Customer has a Shipment Profile Details record for Soda with
a Frequency specified in the Quantity field of 2 per Time Period.
• The Truck Capacity for the Carrier assigned to the Lane from the Warehouse
to Cleveland is 45,000 pounds.
• What is the utilisation of the truck?
http://pic.dhe.ibm.com/infocenter/scappinf/v1r0/index.jsp?topic=%2Fcom.ibm.scapps.lnp.doc%2FModelling%2FTruckUtilizationFormula.html

2023/24 - SCM3604 © HSUHK 8

 Truck Transportation
• IBM Truck Utilisation Formula
– Truck utilization is the percentage of a truck's capacity that is filled
with product.

Example of Frequency
In pounds:

As a percentage:

http://pic.dhe.ibm.com/infocenter/scappinf/v1r0/index.jsp?topic=%2Fcom.ibm.scapps.lnp.doc%2FModelling%2FTruckUtilizationFormula.html

2023/24 - SCM3604 © HSUHK 9

 Rail Transportation

• About 40% of all ton-miles in the United States are

transported by rail.

• About 12% of international shipments within the European

Community are shipped by rail.

• Freight is moved by rail, water,

pipeline, truck, and air.
• The rail network accounts for
approximately 40 percent of U.S.
freight moves by ton-miles (the
length freight travels) and 16
percent by tons (the weight of
freight moved).

2023/24 - SCM3604 © HSUHK 10

 Rail Transportation

• Traditionally, railroads have had three business activities:

– bulk freight (coal, steel, chemicals, and so on),
– break-bulk freight in boxcars, and
– automobiles.

• Railroads are increasingly involved in intermodal shipments,

with an increasing numbers of containers and trailers on
flatcars.
• Rail “land-bridge” developed across United States carrying
freight between Asia and Europe.

2023/24 - SCM3604 © HSUHK 11

 Rail Transportation

Advantages Limitations
• Relatively inexpensive per unit • Rigid on routes, destinations
and departures
• Relatively effective to deliver • Gradients and turns
bulky and heavy cargoes (restriction on new railway
development)
• Specifically-designed vehicles • Gauge (limitation on cross-
for various cargoes, e.g. flat, border rail delivery)
box, and tanker wagons

2023/24 - SCM3604 © HSUHK 12

 Rail Transportation
• Types of trains
– Traditional Freight Train with Bulk and Box Cars
– Single-Stack Container Train
– Double-Stack Container Train
– Piggy-back

2023/24 - SCM3604 © HSUHK 13

 Rail Transportation
• Traditional Freight Train • Single-Stack • Double-Stack
with Bulk and Box Cars Container Train Container Train

2023/24 - SCM3604 © HSUHK 14

 Rail Transportation
• Piggy-back

CITIRAIL Unit on
BNSF Container and
Piggyback Train

Union Pacific container and piggyback

train at Atomic Crossing in Ames, Iowa

2023/24 - SCM3604 © HSUHK 15

 Rail Transportation
• Piggy-back
– A technique that consists of placing truck trailers on specially-designed
railroad cars, so that the trailers can be carried over long distances more
economically
– In Switzerland, trucks must piggy-back if they are crossing the country.
– In the United States and Canada, this is an increasingly common way of
moving trailers for long distances.

– The railway network in the United States is very well

developed, making it an efficient component in
intermodal transportation.
– The railway infrastructure in the PRC covers a vast
span of land, but the system is underdeveloped, and
mainly for passenger transportation.

2023/24 - SCM3604 © HSUHK 16

 Rail Transportation
• Piggyback and Doublestack Train Cars
Piggyback (TOFC) Trailer On Flat Car
40’ (12.2 m)

9’ (2.7 m)
17’ (2.7 m)

85’ (25.9 m)

18’ (5.5 m) Doublestack (COFC)

65’ (19.8 m) Container On Flat Car

2023/24 - SCM3604 © HSUHK 17

 Rail Transportation

• The major railway operators in the United States

– Burlington Northern Santa Fe (BNSF)
– Union Pacific (UP)
– CSX
– Norfolk Southern (NS)
– Canadian National (CN)

What are the reasons for under-developed

railway system in the PRC when compared with
US and EU?

2023/24 - SCM3604 © HSUHK 18

 Belt and Road Initiatives
➢ Silk Road Economic Belt and the 21st Century Maritime Silk Road

4.4 billions
>65 Countries
people

63% of World’s $21 trillion

Population GDP

33% of World’s
GDP

2023/24 - SCM3604 © HSUHK 19

 Port Terminal Operations
• Crane Facilities: Rail Mounted Quayside Cranes (RMQC); Rail Mounted
Gantry Cranes (RMGC); Rubber Tired Gantry Cranes (RTGC)

Quay Crane

Vessel Local Storage Gate

Chassis

Discharging container flow

Loading container flow

Port Productivity Metrics:

• TEUs per hectare
• TEUs per annum
• Dwell time
• Terminal time
• Crane productivity
➢ Crane cycle time
➢ Lifts per hour
➢ Moves per hour

2023/24 - SCM3604 © HSUHK 20

 Freight Forwarding
• Definition:
– A freight forwarder, forwarder, or forwarding agent, is a person or company that
organizes shipments for individuals or corporations to get goods from the
manufacturer or producer to a market, customer or final point of distribution.
• Relationship with carriers:
– Forwarders contract with a carrier to move the goods. A forwarder does not
move the goods but acts as an expert in supply chain management.
– A forwarder contracts with carriers to move cargo ranging from raw agricultural
products to manufactured goods.
– Information typically reviewed by a freight forwarder includes the commercial
invoice, shipper's export declaration, bill of lading and other documents
required by the carrier or country of export, import, and/or transshipment.
• Multi-modal transport:
– Freight can be booked on a variety of shipping providers, including ships,
airplanes, trucks, and railroads.

2023/24 - SCM3604 © HSUHK 21

 Alternative Means of Transportation

• Pipeline
– A mode of transportation consisting of a long series of
pipes, connected end-to-end
– Used for the transport of some liquid cargo (oil, refined
petroleum products, water and natural gas)

What are the advantages

and limitations of pipeline
transportation?

2023/24 - SCM3604 © HSUHK 22

 Alternative Means of Transportation

• Barges
– Flat-bottomed boats designed to carry cargo on rivers and
canals, and that are designed to be pushed or pulled.

– Some of the barges used on the rivers and canals of

Europe are self-propelled.

– Most often used for dry-bulk or

wet-bulk cargo, but increasingly
used for multi-modal shipments
in Europe, from the ocean port to
an inland port.

2023/24 - SCM3604 © HSUHK 23

 Freight Distribution and Network Strategies
• Point-to-point distribution is common when specialized
and specific one-time orders have to be satisfied, which often
creates less-than-full-load as well as empty backhaul
problems.

• Corridor structures of distribution often link high density

agglomerations with services such as the landbridge where
container trains link seaboards. Traffic along the corridor can
be loaded or unloaded at local / regional distribution centers,
acting as load centers in this distribution system.

• Hub-and-spoke networks have mainly emerged with air

freight distribution and with high throughput distribution
centers favored by parcel services. Such a structure is made
possible only if the hub has the capacity to handle large
amounts of time-sensitive consignments.

2023/24 - SCM3604 © HSUHK 24

 Freight Distribution and Network Strategies

• Routing networks tend to use circuits where

freight can be transshipped from one route to
the other at specific hubs.

• Pendulum networks characterizing many

container shipping services are relevant
examples of relatively fixed routing
distribution networks.

• Achieving flexible routing is a complex

network strategy requiring a high level of
logistical integration as routes and hubs are
shifting depending on anticipated variations of
the integrated freight transport demand.

• Flexible routing is mostly used in last mile

parcels services where the routing of
delivery trucks is depending on a shifting
demand landscape.

2023/24 - SCM3604 © HSUHK 25

 References

• Books
– Elbert, R., Friedrich, C., Boltze, M., & Pfohl, H. C. (Eds.). (2019). Urban
Freight Transportation Systems. Elsevier.
– David, P. A. and Stewart, R.D., (2011), Management of International
Trade Operations, 3rd Edition, Cinn. Oh.: Atomic Dog Publishing -
Chapter 13 and 14
– Rodrigue, J. P., Comtois, C., and Slack B., (2009), The Geography of
Transport Systems, 2nd Edition, New York: Routledge – Chapter 3
– Sarder, M.D. (2020) Logistics Transportation Systems: Interdisciplinary,
Multimodal Analysis. Elsevier; 1st edition (October 29, 2020)

2023/24 - SCM3604 © HSUHK 26