Topic 3 – Transportation Modes

1. Topic 3 – Transportation Modes A Diversity of Modes Intermodal Transportation Passengers or Freight?

2. 5. Air Transport • Context • Air routes are practically unlimited: • North Atlantic. • Inside North America and Europe. • Over the North Pacific. • Inside Asia. • Multidimensional constraints: • Site (a commercial plane needs about 3,300 meters of track for landing and take off). • Climate, fog and aerial currents. • Air activities are linked to the tertiary and quaternary sectors: • Finance and tourism that require movements of people. • Accommodating growing quantities of high value freight.

3. 5. Air Transport • Air Space • Segment of the atmosphere that is under the jurisdiction of a nation or under an international agreement for its use. • Two major components: • Land-based; takeoffs and landings. • Air-based; composed of air corridors. • Air corridors can superimpose themselves to altitudes up to 22,500 meters. • Limited to the use of predetermined corridors. • Air space use • Air space exclusively belongs to the country under it. • Access to the land and air-based components is dependent on agreements between nations and airline companies. • Air freedom rights.

4. Air Freedom Rights First Second Third Home Country B Country A Fourth Fifth Sixth Seventh Eight Ninth

5. 5. Air Transport • Development of air transportation • Technical improvements: • Jet engine considerably reduced distances, namely because of greater speeds and improved ranges. • Almost every part of the world can be serviced in less than 24 hours. • Rising affluence: • Linked with income and economic output growth. • Disposable income available for leisure. • International tourism and air transportation are mutually interdependent. • Globalization: • Trade networks established by multinational corporations. • About 40% of the value of global manufactured exports. • About 50% of the value of American overseas - non-NAFTA - exports.

6. Main Commercial Passenger Aircraft, 1935-2006

7. Early Intercontinental Air Routes, 1930s Eyeries London Amsterdam Paris Brindisi Botwood Toulouse Dayr az Zawr Athens Lisbon Baghdad Marseilles New York Basra Azores Alicante Gwadar Karachi Jodhpur Allhahabad Jask Tangier Alexandria Gaza Calcutta Casablanca Cairo Akyab Agadir Rangoon Kuwait Wadi Halfa Bangkok Sharjah Khartoum Dakar Alur Setar Singapore Juba Nairobi Medan Waingapu Mbeya Darwin Natal Palembang Jakarta Harare Surabaya Kupang Katherine Brisbane Johannesburg Mount Isa Rio de Janeiro Longreach Santiago Charleville Cape Town Imperial Airways African Route (c1933) Sydney Imperial Airways/Quantas Australian Route (c1934) Buenos Aires Aeropostale (1930) KLM Amsterdam – Jakarta (1935) Punta Arenas Pan American Transatlantic Route (1939)

8. Flight Times by Piston and Jet Engines from Chicago Piston Engine 10 hours 15 hours 20 hours 24 hours 40 hours 30 hours Jet Engine 20 hours 15 hours 10 hours 24 hours

9. Average Airfare (roundtrip) between New York and London, 1946-2004

10. Range from New York of Different Modern Commercial Jet Planes A-320 (3,700 km) B-777-100 (7,400 km) B-747-400 (11,400 km)

11. World Air Travel and World Air Freight Carried, 1950-2002

12. 5. Air Transport • Airline companies • Highly capital intensive segment of transport services. • Labor intensive, with limited room to lessen those labor requirements. • Around 900 airlines operating 11,600 commercial aircrafts. • Average number of 200 seats per plane. • Dominant share of the traffic is assumed by large passengers and freight carriers. • Strategic alliances • Joint booking systems, exchange of shares, and a reorganization of their services in order to minimize redundancy. • Increased market dominance but also increased competition between major markets.

13. World’s 10 Largest Passengers Airlines, 2000 (in 1,000 passengers)

14. World’s 10 Largest Freight Airlines, 2000 (in 1,000 tons)

15. Market Share of World Airline Traffic, 2003

16. 5. Air Transport • Flows • 1.4 billion passengers traveled by air transport (2000). • 2.8 billion departures and arrivals supported by airports. • Equivalent of 23% of the global population. • 30 million tons of freight were transported. • Air traffic is globally highly imbalanced: • Distribution of the population. • Unequal levels of development. • Concentration of traffic in a limited number of hubs. • 80% of the global population lives in the Northern Hemisphere: • Air traffic is much denser north of the equator. • North America and Europe accounted for 70.4% of all passenger movements in 2000.

17. Major Air Traffic Flows Between Regions, 2000 (% of IATA Scheduled Passengers) North America 3.9 Europe 23.2 1.7 35.5 1.7 1.9 15.9 1.8 1.3 1.5 Asia Central America Middle East 1.3 1.1 1.7 South America Africa Southwest Pacific 3.2 2.6

18. 6. Modal Competition • Integrated transportation systems • Requires maximum flexibility. • Modal competition exists at various degrees and takes several dimensions. • Modes can compete or complement each other: • Cost, speed, accessibility, frequency, safety, comfort, etc. • Intermodal transportation: • Opened many opportunities for complementarity. • Intense competition over many modes in the transport chain.

19. Four Travel Options between New York and Boston, 2004

20. 6. Modal Competition • Three dimensions of modal competition • Modal usage: • Comparative advantage of using a specific or a combination of modes. • Distance remains one of the basic determinant of modal usage. • The basic determinants of modal usage for passengers transportation. • For a similar distance, costs, speed and comfort can be significant factors. • Infrastructure usage: • Competition resulting from the presence of freight and passenger traffic on the same itineraries linking the same nodes. • Market area: • Competition being experienced between transport terminals for allocating new space or capturing new markets.

21. Modal Competition Market Area Infrastructure / Route Mode B B B B B 1 2 5 4 3 6 A A A A A

22. Passenger Transport by Mode, Japan, 1950-1999

23. B – Intermodal Transportation • 1. Intermodalism • 2. Containerization • 3. Modal Choice and Intermodal Transport Costs

24. 1. Intermodalism • Integrated transport systems • Use of at least two different modes in a trip from origin to destination through an intermodal transport chain. • Brought about in part by technology. • Techniques for transferring freight from one mode to another have facilitated intermodal transfers. • The container has been the major development: • Becoming a privileged mode of shipping for rail and maritime transportation.

25. Intermodal Transport Chain Interchange Connection Composition Decomposition Local / Regional Distribution National / International Distribution Transport Terminal

26. 40-Foot Containers Doublestacked on a Rail Car

27. Multimodal and Intermodal Transportation Multimodal Point-to-Point Network Intermodal Integrated Network C C A A B B Transshipment Rail Road D D Transshipment F F E E

28. 2. Containerization • Container • Load unit that can be used by several transport modes. • Usable by maritime, railway and road modes. • Foremost expression on intermodal transportation. • Rectangular shape that can easily be handled. • Reference size is the Twenty-foot Equivalent Unit (TEU). • The most common container is the 40 footer (12 meters)

29. 2. Containerization • Advantages of containers • Standard transport product: • Can be manipulated anywhere in the world (ISO standard). • All segments of the industry have access to the standard. • Specialized ships, trucks and wagons. • Flexibility of usage: • Transport a wide variety of goods ranging. • Raw materials, manufactured goods, cars to frozen products. • Liquids (oil and chemical products). • Perishable food products (“reefers”; 50% of all refrigerated cargo). • Management: • Unique identification number and a size type code. • Transport management no not in terms of loads, but in terms of unit.

30. 2. Containerization • Costs: • Low transport costs, • Speed: • Transshipment operations are minimal and rapid. • Containerships are on average 35% (19 knots versus 14 knots) faster than regular freighter ships. • Warehousing: • Its own warehouse. • Simpler and less expensive packaging. • Stacking capacity on ships, trains (doublestacking) and on the ground. • Security: • Contents of the container is unknown to shippers. • Can only be opened at the origin, at customs and at the destination. • Spoilage and losses (theft), especially those of valued commodities, are therefore reduced.

31. Five Generations of Containerships First Generation (1956-1970) Length Draft TEU 135 m 500 Converted Cargo Vessel < 9 m 200 m Converted Tanker 800 Second Generation (1970-1980) 1,000 – 2,500 10 m 215 m Cellular Containership Third Generation (1980-1988) 250 m 3,000 11-12 m Panamax Class 290 m 4,000 Fourth Generation (1988-2000) Post Panamax 275 – 305 m 4,000 – 5,000 11-13 m Fifth Generation (2000-?) Post Panamax Plus 5,000 – 8,000 335 m 13-14 m

32. Stacked 40-Foot Containers

33. 20-Foot Container on Truck

34. 20-Foot Tank Containers

35. 40’ Reefer

36. “Kegger”

37. 4th Generation Containership

38. 2. Containerization • Disadvantages • Consumption of space. • Infrastructure costs: • Container handling infrastructures, such as giant cranes, warehousing facilities and inland road and rail access, represent important investments for port authorities and load centers. • Stacking. • Management logistics: • Requires management and tracking of every container. • Empty travel. • Illicit trade: • Common instrument used in the illicit trade of drug and weapons, as well as for illegal immigration. • Worries about the usage of containers for terrorism.

39. 3. Modal Choice and Intermodal Transport Costs • Modal choice • Relationship between transport costs, distance and modal choice: • Road transport is usually used for short distances (from 500 to 750 km). • Railway transport for average distances. • Maritime transport for long distances (about 750 km). • Intermodalism: • The opportunity to combine modes. • Find a less costly alternative than an unimodal solution. • Efficiency of contemporary transport systems: • Capacity to route freight. • Capacity to transship it.

40. Distance, Modal Choice and Transport Costs C1 C2 Road C3 Transport costs per unit Rail Maritime D1 D2 Distance

41. Intermodal Transportation Cost Function C(T) Decomposition C(dc) Local / Regional Distribution Cost National / International Distribution Cost C(cn) Connection Costs C(I) Interchange Connection C(cn) C(cp) Composition Origin Transshipment Destination