Intermodal Freight Transportation: Challenges And Opportunities

Overview of Intermodal Freight Transportation

Discuss about the Intermodal Transport Company for Freight Transportation.

The 21^st century has seen a renewed focus on the intermodal freight transportation due to technological and scientific innovation (Ambrosino & Sciomachen, 2017). The need for a reliable and flexible response to the ever-changing customer requirements and hyper competition in the supply chain in the global market thus challenges the logistics policies adopted by any intermodal freight transport in pursuit of competing favorably around the globe.

Intermodal Freight Transportation Company is made up of more than one chain transportation modes that coordinate intermodal terminals in offering shipment services from one place that is the origin to various destinations (Baykaso?lu & Suburban, 2016). The term intermodal is inferred from the fact that it entails the transfer of freight from one mode to the other. This mode might be by seaport or inland terminals such as a river port, airports, and rail yards among many others.

Australia’s largest and efficient transport organization namely Australian Container Freight services (ACFS) is a body that deals with a diverse range of multi-functional container trailer. Its strategic location facilitates quick and efficient movement of goods and services across the country aided by the Sydney and Melbourne facilities.

Container-based transportation plays a significate role in the intermodal transportation process (Coliccio et al, 2017). Since the fundamental idea of intermodal transportation is that of consolidating loads to ease the Long-haul transportation by the various modes. Freighting here therefore extensively employs the use of containers over long distances by local truck pick up and delivery operations to long-haul transportation by air or ocean shipping.

Other reasons that accompany the extensive reliability of containers by intermodal companies is due to its safety properties (Black et al, 2018). First, containers are made of steel or aluminum metals that in essence help reduce loss, damage or deformation of the transported contents. The recent development that has been embraced by the freight companies is the use of electronic sealing and monitoring. This has reduced smuggling, terrorist and illegal immigration. Furthermore, the twenty-foot equivalent unit standard structure of the containers enables easy transfers from one mode to another and transport of various product dimensions.  All these advantages have led to decreased cost and offering better management of goods (Black et al, 2018).

Carries also contribute significantly to the freight transport companies. In the case of an intermodal chain, carriers provide both customized service and consolidation services. The idea of providing flexible reliable and highly dynamic environment for goods transportation is the key factor that promotes the use of carries (Crainic et al, 2017). It is an alternative shipping service to offer lower frequency services while maximizing the volume of demand. Thus at the end providing efficient, cost-effective and favorably compete with other transport service providers such as air transport.

Australian Container Freight Services (ACFS)

Rail freight is estimated to be over 40,000 kilometers of a railway across Australia which transports approximately 290.7 billion Ntks of bulk goods this is according to the Euroean Journal of Operational Reasearch of 2017. Significant growth was experienced due to mining of ore and other minerals done between Adelaide and Darwin terminals. The contribution of Qube Logistics can’t go unnoticed since it promotes the supply of chain infrastructure investments in port and intermodal companies as well as offering short-haul rail services. The Australian government has also undertaken pre-construction activities that include a detailed corridor planning, land acquisition and even community consultation towards improving rail connectivity in major cities and connecting rural business along with its corridors. The rail link connecting Toowoomba Range to Port of Brisbane via acacia Ridge has significantly promoted low costs in the supply chain.

Another important feature of an intermodal transport is the availability of a fully working road freight. It is estimated that 95 percent of all freight movement is by road freight (Halim et al, 2015). The adoption of heavy vehicle reforms such as the use of B-Triples and B-Doubles. Such advancements reforms have open more door to door service for the realization of high productivity. Even though there is productivity through the use of road fridge, fuel and costs remain major issues for road freight.

 Intermodal transport system maximizes the use of rail for shipment of goods from origin to the consumer. Due to growing congestions on road networks has raised the need to invest in the development of rails. Its advantage over road transport is its carrying capacity. Goods and services are transported in bulkiness. It is also cost-competitive over long distances.

Air freight and sea freight also forms part of Australian Freight Company (Marin et al, 2015). Sea freight is significant in the movement of bulk goods such as ores and minerals from an origin that is Australia to other external markets as well as transportation of imported goods into the country and into various accessible cities. On the other hand, air freight deals with time critical and high-value movement of goods that range from parcels, seafood passengers among many more services and produ cts. With the continual growth of imports and reduced costs, the demand for establishing better-equipped inland ports and well-connected terminals seems unavoidable.

The location of rail terminals is a basic logistic strategy in the development of any mode of transport (Ran et al, 2017). For instance, intermodal rail terminals can be developed on any suitable site putting into consideration the network connectivity of the area. Due to congestions in the cities, outside city locations offer the best site for an establishment of rail terminal.

Container-Based Transportation in Intermodal Freight Transportation

The major hindrance that affects intermodal companies is numerous. First is the issue of infrastructure (Teye et al, 2017). There is an insufficiency in the length of road and holding yards. These have caused much delays and inefficiency in the transfer of goods from one mode to the other. The handling equipment’s that help in lifting and loading trains and trailers.

Another major setback on transportation is on fuel prices. The prices have high thus increasing operational costs. The scenario is even worsened by the fact that there is confusion among the regulatory agencies. Over time there has been the development of different modes of transportation necessitating towards the establishment of regulating agencies. These agencies have always been reported to be working individually rather than in unison thus determining and regulation of prices becomes tedious and almost impossible for freight transport to work efficiently and favorably in an ample environment.  

Again there is weight and bulkiness problem ( Teye et al, 2017). The problem arises from the non-stringent rules in the weight limitation rules. Other factors accompanied by with bulk goods are accidents. Even though, there are many other agents to accidents which includes local inadequate lane width, subgrade, turning capacity and substandard pavement thickness. Many tunnels existing also lacks the double-stack technology hence hindering movement of tall loads. Rail transport train transporting goods is always heavy and slow compared to passenger train with high speed makes sharing of rail line totally impossible. More so such it will create technological problems calling for reconstruction or even construction of new effective railroads.

According to the Council of Supply Chain Management Professionals, 2014 logistics management is defined as supply chain management body that plans, controls and implementing policies that ensure there is a controlled and effective forward and reverses the flow of goods and services from the original point to that of the consumer. The logistics industry in Australia employs 1.2 million people and is a major income generator to the Australian economy. In 2010 statistics it is recorded that Gross Domestic Product (GDP) contributed directly by Freight Company was $111.5 billion which further raised to $136 billion in 2013.

The logistics industry is the backbone of every country. It enables exporters to make exorbitant profits by connecting them with key markets. Manufacturers and producers also benefit from freight logistics by keeping their products cost-competitive against cheap imported products. This ideology is fully supported by (Ghane & Vergara, 2016) Freight companies following an efficient logistics will also promote healthy competition of price goods and customer choice preference over a larger area.

Advantages of Container-Based Transportation

According to (Black,  2018)  transport tasks entitled to freight logistics industries is estimated to be about 600 billion tone kilometers and is projected to increase by 80% by the year 2030. Acces to ports is now a critical prospect that ensures the projected growth of bulk imports and exports. Productivity is further geared by efficient road and rail infrastructure since it readily accommodates the freight growth. Over time freight network has increased its dominance in bulk movements which has consequently led to increasingly large shares of Australian goods in the world export market.

Australia is large country though geographically isolated from major international markets. In order to prevent itself from the economical cold of isolation, it, therefore, maximizes its energy on logistics development strategies (Black, 2018). This has enabled Australia to compete in international markets as well as a domestic market with imported goods. The strategy model adopted in Australia thus serves the purpose of connecting point to point network but as cities become congested better models will be embraced. Spoke network and large scale hub like the one adopted in North America can also be applied in Australia. 

Competitive framework as a strategy can also explain the potential influence of intermodal transport on the unimodal transport system. The increased demands of intermodal transport are due to the superior business model it employs. By becoming more sustainable than the competing companies, on the other hand, will result in other efficient and innovative business model. (Baykaso?lu et al, 2016)

Customer needs and interests are crucial aspects that affect either positively or negatively on the business development depending on how their interests are taken into consideration. According to ACFS port logistics report 2017, wellbeing and safety performance has been highlighted as a basic aspect that will help provide an opportunity for Australian people to live a healthy and positive lifestyle in pursuit of thriving economically as well as maintaining a high profile reputation. This is a business strategy not only employed by the Australian transport sector but also applicable to all business organizations.

Another strategy by port authorities is that of shifting focus from the development of the port area to that of advancing in supply chain based viewpoint. For a successful hinterland strategy of a port authority is by extension of activities into hinterland rather than only developing the port bearing in mind that there is increased congestion in the terminals. 

Role of Carriers in Intermodal Freight Transportation

In recent years there has been the emergence of important strategies which affect the movement of freight but the challenge experienced is lack of voice in echoing dynamic strategies gained from research and logistics debates (Marin et al, 2015). The issues affecting freight hubs are many and has overlapped over time. These include regulation problems, national and government policies, insufficient funding by government and insatiable growing demands for adequate investments in infrastructure. In spite, the many issues addressed there are probable recommendations discussed below that is taken into consideration will help address  

There are a number of recommendations that should be employed by freight companies. First, it should strategize on gaining competitive advantage. This is a brilliant idea which aims at achieving necessary dynamics to compete with other companies. For instance, the Australian freight company should implement business models that other companies are not able to duplicate. According to the International Journal of Economic Theories and Practices (2015), the best rationale is the resource-based view which claims differential firm performance is fundamentally due to firm heterogeneity and is based on rare capabilities, valuable, standard and difficult to imitate.

Recommendations towards improving the intermodal terminal working efficiency are by extending the working hours from the usual morning and evening hours (Slack, 2010). The pressure is felt by the pick-up and delivery customers since these are the arrival and departure times of trains.  These periods are always compressed than increasing demand for premium train paths that can work on the specified times. Online booking systems will also help in reducing such congestions.

The private sector is an active investor in the economic development of any country. The Australian government should consider giving more chances for private companies to invest in intermodal network developments.  The private sector has the commercial willpower to maintain and develop transport sector as a business. Consequently overlying on private sector does hinder economic growth since government intervention and policies are rarely required. 

To support volume growth at intermodal terminals there should be a reduced distance of the pickup and delivery leg in order to reduce operating costs. Since competitive advantage is the key idea, the rail-based supply chain should be integrated vertically and horizontally by the service providers within the site. The integration improves the efficiency of coordinating the transition within the rail supply chain. This process usually termed as co-location furthermore reduces double-handling thus reducing operations costs.

Rail Freight in Australia

Another recommendation is on advancement in technology. In this case, a closer understanding will be by looking at Intelligent Transport Systems for Commercial Vehicle Operations (ITS/CVO).  This technology is used in North America. (Slack, 2010) explains that this is system regulates and controls the movement of goods from point of origin to the various destinations. CVO also oversees the movement of people and other necessary commercial operations. Government policies concerning electronic verification and clearance should also be strengthened. Over a long period of time system errors from the database has lessened the efficiency in the determination of liability and safety standards of tracks operating in highways. Getting funds from the government will promote innovations of many ITS-CVO and other safety requirements.

Investing in the development of Intelligent Transport System (ITS) will not only provide better management and control of resources but also provide freight and fleet management. The system is also well recommended for implementation since it allows efficient flow of information and automatic identification of transport tracts and shipments thus leading to reduced cost operation, flexibility, time-saving and service responsiveness this well supported by (Ran et al, 2017)

In the case of congestions in cities and urban centers, city logistics process is the solution. The process considers many factors affecting urban freight transportation system among which includes, economical constraints, energy impacts, social and environmental issues. City logistics will encourage intermodal terminal transfers through the development of freight villages. Freight villages are operational in countries like Switzerland and Germany. The concept argues that the Freight companies should construct this village in under-developed locations that are close to urban centers or cities. Implementing this concept will provide a relevant solution to the current traffic congestion, pollution and also accessibility problems.

City logistics also advocates for the development of partnerships among the key role players in the transport sector. According to (Colicchia et al, 2017), partnerships goes hand in hand with the development of better alternative ways of cooperation that are involved in the urban transportation process. This, in essence, will generate a significant reduction in resources used such as a number of tracks and also time conserved due to cooperation.

 Freight transport security is another major aspect that should be considered for efficiency and global economic growth. The government initiatives here comes in handy in order to establish workable security policies such as custom services and enforcement strategies and procedures that will ensure the secure flow of goods and services in the region. Since freight services rely more on containers many efforts are required to develop or introduce technological models and algorithms that provide solutions on the same. Pre-screening and security checks should always be performed.

In conclusion, Australian Logistics Council has played a significant role in improving efficiency, productivity, and safety of the transport commodities (Colicchia et al, 2017). Government policymakers and logistics providers are therefore challenged to join efforts and work in unison to realize sustainable freight advancement. It is also a clear fact that a substantial part of Australia’s economy exists due to its ability and utilization of logistics services in performing its trading activities. 

References

Ambrosino, D. and Sciomachen, A., 2017, September. Investment evaluation in seaports for increasing the rail split modality in multimodal freight networks. In Service Operations and Logistics, and Informatics (SOLI), 2017 IEEE International Conference on (pp. 181-186). IEEE.

Baykaso?lu, A. and Suburban, K., 2016. A multi-objective sustainable load planning model for intermodal transportation networks with a real-life application. Transportation Research Part E: Logistics and Transportation Review, 95, pp.207-247.

Black, J., Roso, V., Maruši?, E. and Brnjac, N., 2018. Issues in Dry Port Location and Implementation in Metropolitan Areas: The Case of Sydney, Australia. Transactions on maritime science, 7(01), pp.41-50.

 Colicchio, C., Corazza, A. and Dallari, F., 2017. Lean and green supply chain management through intermodal transport: insights from the fast moving consumer goods industry. Production Planning & Control, 28(4), pp.321-334.

Crainic, T.G., Perboli, G. and Rosano, M., 2017. Simulation of intermodal freight transportation systems: a taxonomy. European Journal of Operational Research.

Ghane-Ezabadi, M. and Vergara, H.A., 2016. Decomposition approach for integrated intermodal logistics network design. Transportation Research Part E: Logistics and Transportation Review, 89, pp.53-69.

Halim, R.A., Kwakkel, J.H. and Tavasszy, L.A., 2015. A Method to Model Freight Logistics Network for Policy Analysis: An Application to Estimate European Ports’ Intermodal Logistics Network (No. 15-3301).

Marin, G., Mateiu, A. and Mallinger, W., 2015. Collaborative Practices within the Supply Chain Area, as a Solution for Logistic Enterprises to Solve the Challenges in Obtaining Sustainability. International Journal of Economic Practices and Theories, 5(3), pp.222-232.

Ran, W., Zhang, Z. and Liu, S., 2017. A Flexible Logistics Distribution Hub Model considering Cost Weighted Time. Discrete Dynamics in Nature and Society, 2017.

Slack, B., 1990. Intermodal transportation in North America and the development of inland load centers. The professional geographer, 42(1), pp.72-83.

Teye, C., Bell, M.G. and Bliemer, M.C., 2017. Urban intermodal terminals: The entropy maximizing facility location problem. Transportation Research Part B: Methodological, 100, pp.64-81.