SCMN Transportation

Air

-Limited number of large carriers earn about 90% of the revenue -any of the air carriers can carry air freights -cost structure is highly variable; do not own rights-of-way -fastest transit times -> highest rates -average revenue per ton mile is 18 times higher than rail; twice that of motor carriers -best for high value to weight ratio -accessibility is low as is capability -reliability subject to weather more than other modes -limitations on what can be shipped (ex: oxygen containers)

Pipelines

-Petroleum products -low cost relative to other modes -not applicable for vast majority

Containerization

-US government used small, standard sized containers during WWII -Malcom Mclean (1956) --idea of transporting (loaded) truck trailers on ships --reduced cost of loading 90%+ -container ships now carry 60%+ of goods ship via ocean carrier

Motor

Characterized as by large number of small firms -low cost of entry causes these large numbers Account for 77% of US freight expenditures -largest area of freight spending High accessibility Transit times faster than rail or water Reliabilty can be greatly affected by weather Relatively high cost compared to rail and water 3 types of motor carriers -truckload carriers (TL) 15000+ lbs -less than truckload (LTL) 150-15000 lbs -small package carriers? Indirect and special carriers -small package carriers --evolved to carry small, irregular shipments (UPS) --fast service, premium rates --lines blurring - also large LTL business

International water

General cargo ship -large, high capacity cargo holds -engaged on a contract basis -many have self-contained cranes for loading/ unloading Bulk carriers -specially designed to haul minerals -can handle multiple cargos Tankers -specially designed for liquid cargos -carry most tonnage Container ships -high speeds for ships; increasingly more common and important -larger vessels can handle 7500-9500 containers (now even more because of widening of panema canal) -intermodel links RO-RO (roll on- roll off) -basically a large ferry that facilitates the loading and unloading process by using drive on/off/ ramps -may also have the capacity to haul containers -Toyota/Nissan use to transport vehicles from Japan to US Other -OBO multipurpose carriers -Oceangoing barges

Basic modes of transportation

Motor, rail, air, water and pipeline

intermodal transportation

Refers to using two or more modes of transportation cooperating on the movement of shipment by publishing a through rate

Water

Why use water carriers? -an original mode of transport. Most major cities are along a water route -70% of US international freights move by water -principal advantage -> low cost -drawback -> very slow Relatively low cost mode -do not own the rights-of-way Typically a long distance mover of low value, bulk-type mineral, agricultural, and forest products Low accessibility but high capabilities/ high capacity

Landbridge

ocean -> railroad across US -> other ocean

ton-mile

one ton of cargo carried one mile and is a standard statistical measurement used in the transportation industry

TEU

the acronym for twenty foot equivalent unit, a measure of container size. A standard 40 foot container is 2 TEU

US transport expenditures

total cost of transportation has increased over time, but its % of the GDP has decreased

Railroads

very small number of large carriers -7 " class 1" railroads carry over 90% of freight in North America BNSF CSX Kansas City Southern Norfolk Southern Union Pacific Canadian National Canadian Pacific Ferromex* Capable of carrying a wide variety of products Long distance, large mover of low value and/or high-density items -at relatively low rates -important intermodal link More often found inbound -> RMs Downsides -low accessibility -long transit times -"rough" rides (opportunity for damage) -lack of investment -less feasible