International Transport System - Assignment Example

Part 1 Question a The double stack container services were introduced in 1984 in North America and became an increasingly accepted mode of intermodal shipping. The double-stack train is designed in a way that it accommodates freight containers positioned two high, which are placed one on top of the other on the railroads. The technical principle of the double-stack entails forty containers with a standard length with all stacks bearing either 45, 48 or 53 inches, which are all often stack at a width of 40 inches (Regmi, 2010). The flourish of double stack container transits especially in North America has been facilitated by intermodal accessibility and efficiency, market function and intensity and the availability of the necessary structure and governance (Rodrigue & Notheboam, 2012). The availability and accessibility to intermodal transport is one of the motivations shaping the materialization and growth of dry ports. In this regard, all inland markets have created their capacity requiring diverse transport services. Therefore, there is no solitary strategy for each dry port when appraised against modal preferences, as regional influence remains paramount. In regard to market function and intensity, the emergency of international supply chains and the Pacific countries’ strategies around the export based paradigm have continually formed a powerful force shaping the present freight shipment. Finally, players in the cargo shipment industry such as shipping firms and logistics providers have been obliged to inspect supply chains comprehensively to identify where capacity and consistency are an issue (Rodrigue & Notheboam, 2012). Question b Initially, the double stack container services were only used in North America since their introduction in 1984 to help with inland container transportation (Rodrigue & Notheboam, 2012). However, lately some countries like such as India, Pakistan, China, Australia, Russia, and Finland have started operating the double stack container services in the transportation of containers, although in different capacities and weights. For instance, the double stack container services were introduced in March 2006 between Pipavav and Jaipur India; in April 2004 trains carrying boxes measuring 40 feet operating between Beijing and Shanghai China were also commissioned. Therefore, I feel these regions have the capacity to accommodate the double stack container services because of the following factors. India has built freight corridors having overhead wiring of 7.45m or 24.4 ft above the rail that is high enough while Russia, Australia, Finland and Pakistan have overhead wiring of 6.5 m or 21 ft with 25 Kv AC that is considered sufficiently high enough allowing the use of the double stack container services. Moreover, India and Pakistan have broad gauges that allow trains carrying double-stacked standard shipping containers on normal flat wagons. Thus, these countries have high tunnels and bridges, high overhead catenary, train weight limits and permitted loading gauges unlike most European countries, which have low tunnels and bridges, restricted loading gauges, etc. Therefore, globally I can advise the manufacturer to expand into these markets, which have already started operating the system and are planning further expansion. Part 2 Den Hengst’s model of business correlation within the intermodal freight operations is categorized into four management levels. The transport requester, the chain manager, port facilitators and transport providers (Hengst, 2008). These levels play a significant role in ensuring that intermodal freight shipment operations are efficient and thriving. The transport requester includes individuals such as the seller, buyer, shipper, and consignee. The seller provides the cargo for sale whereas the purchaser is the buyer at the end of the shipping destination who pays for the cargo. The shipper is the individual who contacts with the carrier for transit of cargo The second patch of operators are port facilitators comprising the ports authority, customs, banks and insurance companies. The ports authority is the main body at the helm of developing policies and regulating freight operations whereas the Customs enforces & implements the policies. Finally, the Banks finance the operations of transportation companies whereas insurance companies provide covers to shippers of cargo (Hengst, 2008). At the core of the intermodal freight, are the chain management teams who serve both the transport requesters and facilitators. The chain managers include the forwarders, inland carriers and transport requesters. The agents represent the principals and, therefore, execute all duties of the principal including signing of the Bills of Lading (Hengst, 2008). Part 3 Question a There are a number of factors that individuals and organisations consider when selecting the mode of transport for their goods and services. Thus, given that the company wants to transport heavy fuel oil, which is regarded as a bulky commodity, the company should consider the cost of transportation (Konings, 2008), the distance to be covered, the speed of delivery, the availability of loading and off-loading services, the regularity of service and the nature of the commodity. Therefore, given that oil is a bulky and heavy commodity, therefore, a cheaper and reliable mode of transport is necessary to transport the fuel oil to the power station. Moreover, given that deliveries to the power station will be in short periods like daily, weekly and monthly, the speed of delivery will be an important factor to consider when choosing the mode of transport, in addition to, availability of loading and offloading services both at the port and at the power station. Therefore, my advice to the company will be to choose rail because it is a cheaper and quicker of mode of transport for bulky and heavy goods when the time of delivery is short (Konings, 2008). Moreover, rail is unaffected by weather conditions hence is more reliable than water transport or road. That notwithstanding, given that the distance by rail is much longer than water and need for quicker delivery, rail will be more reliable compared to water and road, which has already been restricted because of environmental impact. Question b If the life span of the project was 5 or 30 years it would imply that deliveries to the power station would be made in large quantities at once to minimize the costs of transportation of the heavy fuel to the station on a frequent basis (Konings, 2008). Therefore, because of this change the company can consider an alternative cheaper mode to rail transport and this case, water transport. Thus, because the power station is located on an estuary of a river, which is served by a canal, ship tankers carrying the heavy fuel oil can easily navigate through the canal to the estuary to deliver the fuel oil. Moreover, it has also been argued that canal transport is the cheapest mode of transport where time is not a major factor as was evidenced during the industrial revolution when canals were used transporting heavy and bulky goods (about forty tonnes), which would not transported over road. Therefore, given that all factors have been considered, I will advise the company to change to water transport because time will not be of essence to enable it reduce its costs of transportation; a factor that is critical and influences the overall profitability of the company (Konings, 2008). Part 4 Question a Dry ports according to UNESCAP refers to inland intermodal terminals with direct connection to rails or roads from the seaports, which act as centers for inland transshipments (Regmi, 2010). To facilitate these operations, comprehensive custom-allied services and other interrelated services such as inspections of export and import cargo are provided. The UNESCAP’s description of a dry port as creating a virtuous cycle is an allegory statement illustrating the self-sufficiency and worthiness of a dry port or simply the interdependence of the operations as being in a circle. Often the cycle is in four phases: starting with the development of a dry port; followed by reduced transportation costs and shipment time. The third phase of the cycle is investment in logistics, agriculture, and manufacturing in the dry port’s neighbourhood and finally, the investment of robust transport infrastructure to advance the dry port (Regmi, 2010). The surfacing of dry ports defines new benefits that were not possible with the inland ports (Regmi, 2010). First, whilst inland terminals have inadequate land for expansion, the rise of dry ports supports less rigorous freight operations amid increased activities at the main ports. Secondly, dry ports can provide capacity and space for port operations unlike the inland terminals that are characterised by increased freight distribution thus, fostering dry port development. Third, in case of long distance transportation corridors, dry ports bestow a higher level of convenience because of lesser distribution expenses and improved capacity (Regmi, 2010). Question b In line with these developments in the Trans-Asian railway corridor, a number of factors dictate locating of dry ports along railway networks. The first factor is the existence of commercial centres along the rail corridor that has sufficient inland capitals. A good example is China’s Shijiazhuang dry port, one of China’s largest port with a capacity of over 205, 000 TEU per annum. This port together with other small dry ports under construction is flourishing especially around the Urumqi railway station, in addition to, to serving markets in Xinjiang (Hanaoka & Regmi, 2011). The second consideration for location is the availability of potential industries and agricultural centers. For instance, Uiwang dry port in the Republic of Korea, which is located on the outskirts of inland ports to ease congestion. Some of the potential private-sector industries and working companies include customs, plant quarantine, food inspection, and railway servicing operations (Hanaoka & Regmi, 2011). A third consideration for location is the presence of major intersection areas along the rail network that facilitates transfer of cargo to more than one destination. A relevant dry port with such location is India’s Tughlakabad, which is positioned 17 KM to the south-west of Delhi with a capacity of 400,000 TEU per annum. From the junction, the dry port has links to Jawaharlal Nehru and Mumbai ports through the Delhi–Mumbai major trunk corridor (Hanaoka & Regmi, 2011). Part 5 Some of the major challenges facing the development of intermodalism is the location of ports in highly congested metropolitan areas, which impede the free flow of trucks and trains at the gateways. Therefore, because of these challenges, there is a need for high coordination and interconnectivity to help ease this congestion to save time and costs of transactions. Thus, I believe these challenges can only be addressed through efficient and effective development of technology and equipment as opposed to institutional changes like greater cooperation between the private and public sector and the evolution of new forms of business enterprises like 3rd party and 4th party logistic firms (Chatterjee and Lakshmanan, 2008). That notwithstanding, the only means to minimize the transaction costs such as human and handling costs is through faster transfer of cargo through efficient and effective technology and equipment e.g. through the use of internet & communication technologies to enhance coordination and cooperation among firms. Moreover, with the development of containerisation after the rationalisation of equipment for cargo handling e.g. corn stackers and gentry cranes, which have the capacity of discharging containers ships and piers at average rates of 30 containers/hr have significantly reduced handling costs and increased speed of transfers. Moreover, innovations in technology such as GPS and automated electronic identification-AEI have also helped in providing plethora information on the size, type, origin, destination, composition and location of containers thus, helping in reducing the average time for handling cargo at ports by facilitating quicker transfer and transportation (Konings, 2008). References Chatterjee, L., and Lakshmanan, T.R., 2008. Intermodal Freight Transport in the United States. In: Konings, R., Priemus, H., and Nijkamp, P., (eds). The future of intermodal freight transport: operations, design and policy. Edward Elgar Publishing, 34-57. Hanaoka, S., & Regmi, M. B., 2011. Promoting intermodal freight transport through the development of dry ports in Asia: An environmental perspective. IATSS Research, 35(1), 16-23. Hengst, M., 2008. Interorganizational Coordination: The Role of Information Technology: In: Konings, R., Priemus, H., and Nijkamp, P., (eds). The future of intermodal freight transport: operations, design and policy. Edward Elgar Publishing, 252-270. Konings, J. W., 2008. The future of intermodal freight transport: operations, design and policy. Edward Elgar Publishing. Regmi, M. B., 2010. Assessment of Impacts of Climate Change on Road Transport. Rodrigue, J. P., & Notteboom, T., 2012. Dry ports in European and North American intermodal rail systems: Two of a kind. Research in Transportation Business & Management, 5, 4-15. Read More