Transportation of Cargo the UK and Greece Corridor - Case Study Example

Transportation of Cargo – the UK and Greece Corridor Introduction – a Bird’s Eye of View of Various Related Factors Before identifying and elaborating on the most appropriate means of transporting cargo from the UK to Greece, it is imperative to be taking a glance at all the related key aspects such as various modes of transportation & costs involved and relevant risk factors, etc. Over the years, the European Zone has been witnessing an alarming rise in instances such as traffic jams and congestions, etc, resulting primarily from a rapid rise in freight being transported by road. To counter this unpleasant scenario where heightened vehicular flow on the roads has become the order of the day, the authorities have been launching many initiatives aimed at encouraging the usage of modes of transport other than the road. One of those (initiatives) is the Multimodal Transport Policy, which has been successfully tested, with regard to transportation of Whisky to Greece, from the UK. All the pertinent factors such as time, cost, distance and means of transport, among others, were meticulously considered, before coming out with this policy. One of the essential features of Multimodal Transport Policy is that, whenever required, it encourages the transport of freight by diverse modes. (1) (Anthony K.C. Beresford. 1999). In relation to the entire Europe, freight movement between certain routes has been identified to be of paramount significance not just to the economy of the UK, but also for the commercial well-being of the region in question. The corridor of the UK – Greece is prominently positioned in the list of the above-mentioned routes. It needs to be noted that, many intricacies are also involved in moving of freight on all routes encompassed by this corridor. Owing to this, it is of utmost importance that the system of Multimodal Transport, which withstood various challenging conditions in the testing stage, needs to be adhered to for moving freight in the UK-Greece Corridor. (1) (Anthony K.C. Beresford. 1999). Even prior to the introduction of the Multimodal Transport Policy, there were many governmental initiatives encouraging the minimization of dependency on roads for movement of freight. For instance, in the UK, grants are provided for infrastructure development, when willingness, backed by solid proof, is expressed for preventing many trucks from coming on to roads, when an effective facility like a link or siding, rail terminal, etc, is provided by the authorities. (1) (Anthony K.C. Beresford. 1999). At this juncture, it won’t be out of place in making a serious note of a major impediment for transporting goods by road, in the European Zone. During some specified timings of a weekend, driving is prohibited, and this turns out to be a grave obstacle for freight moving by road. This could potentially lead to many complex situations, more so in case of international transactions, which are already burdened by various regulations. In addition, because of aspects such as mandatory speed limit for trucks and traffic congestions, the average speed (of trucks) has drastically reduced. As a matter of fact, owing to the points dwelled upon in this paragraph, the trucks are gradually being viewed as the least preferred means of moving freight. (1) (Anthony K.C. Beresford. 1999). The process of deciding on the means of transport to be utilized for international freight movement is an extremely complicated one, in the European scenario, with many parameters coming into play. For domestic transport of freight, many models that are based on cost and distance are available, and which suggest either roadways or railways as the apt mode, based on individual cases. (1) (Anthony K.C. Beresford. 1999). Depending on various vital factors such as nature of the commodity, delivery specifications and the purpose for which the commodity would be used, etc, the shipper opts for a mode of transport best addressing his overall requirement. Prior to the advent of this Multimodal Transport System, very little was done to modify the existing models of cost-distance so as to make them highly conducive for overseas movement of freight. (1) (Anthony K.C. Beresford. 1999). But this modified and latest model of transport has been designed to successfully address the needs of international freight, and thus provides a highly lucrative option for all overseas shipments. The basic premise from which this model has been developed maintains that cost per unit related to transport tends to differ a lot between the various means of transportation. Also, the model strongly suggests that for consignments of huge volume, transport by sea is the most cost-effective option, with movement by road being the highly exorbitant choice. It (the model) has identified railways and other forms of waterways as options that are not as moderately priced as sea transport and at the same time are cost-efficient, in relation to roadways. (1) (Anthony K.C. Beresford. 1999). This system of Multimodal transport, fully recognizing the economic relevance of the UK-Greece Corridor, has come out with numerous options for moving freight between the two zones (from the UK to Greece). The following table highlights all those alternatives. Mode of Transport Options Waterways Road-sea-road via Straight of Gibraltar Roadways Road-ferry-road via Balkans Roadways Road-ferry-road-ferry-road via Italy Roadways Road-rail-road via channel tunnel shuttle Rail/Multimodal Road-rail-road via Balkans Rail/Multimodal Road-rail-ferry-road via Italy Rail/Multimodal Road-rail-road-ferry-road via Italy (1) (Anthony K.C. Beresford. 1999). A substantial chunk of the present freight movement between the UK and Greece takes place by sea, owing primarily to both reliability and also frequency of services. But in this regard, the shippers are impeded because of diverting the route at the Iberian Peninsula. This brings a two-fold rise in the transit time, as well as the distance to be traversed. (1) (Anthony K.C. Beresford. 1999). Notwithstanding the fact that, entirely relying on railways for moving freight to Greece from the UK, via Balkans, is the least preferred alternative, this mode of freight is highly effective for transportation between Euro-terminals and freight villages of the UK. But it still needs to be conceded that, for majority of routes, depending a lot on railways is not at all a viable option for moving freight between the two zones. A major obstacle for this being the difficulty in bringing about coordination between various rail services, and this, in all likelihood, could prevent the goods from reaching the destination, on time. (1) (Anthony K.C. Beresford. 1999). Transit Time of Various Modes When a situation is considered where there are no halts prior to the final point of destination, the duration of transit by sea is around 150 hours. In the event of in-between halts, this duration would increase depending on several key factors such as volume of traffic. As per a leading importer of Greece, the actual duration of transit between the UK and Greece ranges from 13-16 days. The roadway routes between the two regions pass through Balkan Peninsula or Italy. Freight moving through this mode (road) and travelling between the UK and continental Europe is facilitated by the presence of numerous ferry services and the Channel Tunnel. This ensures that the time of transit is significantly minimized. But in the event of circumstances like high peak hour traffic, the time of waiting again increases, and thus the benefit offered by the tunnel and the ferry services loses some of its relevance. The railways indicate the least reliable form of transporting freight between the two zones, owing chiefly to an abysmally low frequency of services. Train services to Greece from the UK operate at about just once in every fortnight, and hence, when a train is missed, an abnormal delay in transit becomes inevitable. Additionally, the transit duration of trains running between London and Athens is in the range of 130-150 hours. However, despite all that, trains travelling to Greece, through Germany, France and Italy signify a relatively more efficient form of freight movement, through this mode (railways). (1) (Anthony K.C. Beresford. 1999). A Brief Overview of Costs The distance by road between the UK and Greece, when passing though Italy, is about 2,403 km. Here, based on various intermediate transit costs such as ferry services, it is projected that the cost of crude road haulage in this route is well over £ 1 for every truck km. Likewise, the cost for every rail kilometer is at around £ 6.50, which could be rated to be on the lower side, in comparison with the prevalent standards. In spite of the presence of so many services of a diverse range, still, even to this day, transport by sea remains the best alternative, with regard to freight movement from the UK to Greece. This mode offers the lowest cost per km. And here, it would be worthwhile in noting that, for non-perishable goods, transportation by sea is considered to be the best available option. (1) (Anthony K.C. Beresford. 1999). Latest Trends in the Realm of Freight Transport Over the years, the avenue of Information Technology has displayed a phenomenal surge, transforming many hitherto intricacies into matters that are resolved in a simplified manner. Especially, with the advent and the extensive usage of Internet, companies of diverse sectors are now empowered in arriving at highly apt decisions that leave no margin of error. Obviously, the sphere of Cargo Transportation is also no exception to this. Many entities, operating also through the Internet, are providing vital details to shippers enabling them in arriving at fully informed decisions conducive to their overall prosperity. Here, it would not be out of place in having a brief look at some of them offering unique services. OceanSchedules.com provides highly robust tools of search, enabling speedy identification of schedules of all voyages, for the shippers. The portal uses highly sophisticated web technologies simplifying the process of search, along with providing the facility of online booking. (2) (OceanScheduels.com, 2009). The Maersk Line fleet, a leading shipping player, worldwide, is constituted of well over five hundred vessels and numerous containers, providing a global coverage, and thus addressing the diverse needs of shippers. (3) (MAERSK LINE, ND). Freightquote.com provides an extensive range of services that address the various aspects of shipping. The services are inclusive of automated dispatch, documentation, LTL Trucking, truckload shipping and tracking, among many others. (4) (FREIGHTQUOTE.COM, 2010). Kn-portal.com includes the prevalent schedules for a major chunk of Kuehne and Nagel ocean carriers. The portal leaves no stone unturned in ensuring that all the relevant information is an updated one, so that the shippers are benefited in arriving at right decisions. (5) (KUEHNE + NAGEL, 2010). DHL is the worldwide leader in the logistics sector, offering freight services through sea, road and rail. Globally, the group is connected by a wide network covering well over 220 countries, addressing all the customer needs pertaining to supply chain. DHL is backed by a manpower numbering over 300,000, working in diverse parts of the globe. (6) (DHL, 2010). All the above-mentioned are just few of the numerous facilities that are now available for the shippers, courtesy the Internet and web technologies. There would not be any hesitation whatsoever in concluding that, even during contemporary times, seaways denote that most reliable form of moving freight from the UK to Greece. Moreover, it has already been observed that, for all non-perishable commodities leaving for Greece, transport by sea is the one that offers topmost levels of reliability. In addition, it also is a fact worth active consideration that, owing to all the online services, which are now the order the day, moving freight by sea has now become a much simpler option, when related to the corresponding scenario of the pre-Internet era. There is no denying of the fact that, sea transport takes a fairly longer duration than many of the other modes. Yet, that should not be deterring the shippers from relying on this (sea) mode, because, when all the aspects of a transaction are scrupulously planned right from the beginning, without ignoring even apparently minute details, the duration of moving freight by sea could never be an obstacle. European Union Policy Initiatives and Freight Transport In the recent past, the European Commission has launched some initiatives propelled by the objective of further enhancing the quality of freight transport in the European Union, in terms of both sustainability and also efficiency. The initiatives, along with emphasizing on bringing about further rise in the operational efficiency of ports, also focus on rapidly developing the railway network, which as of now, is not up to the required standards. Overall, these policies of the commission strive to display high levels of success in addressing the various key aspects pertinent to freight transport, such as, using more sophisticated infrastructure technologies, enhancement of freight management and development of freight transport chains, to cite a few. The policy initiatives can be summarized as the ones aimed at addressing the diverse and intricate facets of the aspect of logistics. (7) (Europa, 2007). These initiatives would surely be exercising a positive impact on the realm of freight transportation. As a matter of fact, it would in no way be an exaggeration in asserting that, once all the policies become the order of the day, many decisions of the shippers would be in stark contrast to those that they used to arrive in the past scenario marked by the presence of limited resources. For instance, it has been noted that a primary objective of these policies is to widen the network of railways. In this future scenario of enhanced train services, there is every possibility that, shippers who earlier preferred other modes of transport, would then be opting for railways, for a specific consignment. Likewise, all the seaports fortified with extra shipper-friendly features would be essaying a pivotal role in ensuring that the number of shipments just goes on to display a rapid rise. The fact that such a state of affairs, in the long run, would be immensely contributing to the overall economic growth of the United Kingdom warrants no special mention. Sources 1) Anthony K.C. Beresford. 1999. Modelling Freight Transport Costs: A Case Study of the UK-Greece. Retrieved from academia-research.com/files/instr/457724_MAR_108_RESIT_2_A.pdf. 2) OceanScheduels.com, 2009. About OceanScheduels.com, Retrieved from oceanschedules.com/schedules/aboutus.do. 3) MAERSK LINE, ND. MAERSK LINE. Retrieved from maerskline.com/appmanager/. 4) FREIGHTQUOTE.COM, 2010. Freight Services. Retrieved from freightquote.com/Freight/ 5) KUEHNE + NAGEL, 2010. Welcome to the Kuehne + Nagel Schedules site. Retrieved from kn-portal.com/services/seafreight/carrier_schedules/. 6) DHL, 2010. Freight Transportation. Retrieved from dhl.co.uk/en/logistics/freight_transportation.html. 7) Europa, 2007. Press releases RAPID. Retrieved from europa.eu/rapid/pressReleasesAction.do?reference=IP/07/1550&format=HTML&aged=0&language=EN&guiLanguage=en Read More