Chapter 1 - Introduction to Freight Transportation

CHAPTER INTRODUCTION TO FREIGHT TRANSPORTATION TRAN QUOC CONG Industrial Systems Engineering Department Mechanical Engineering Faculty Ho Chi Minh City University of Technology - VNU Contents • Introduction • Transport measurement units • Core component of transportation • The transport system • Transportation networks • The role of transportation Introduction • The changing economic landscape: Driving forces • Supply chain concept • The purpose of transportation • Transportability • Distance, a core attribute of transportation • Euclidean distance • Transport distance • Logistical distance The Changing Economic Landscape: Driving Forces • More complex and competitive operating environment • Efficient (reducing their cost of doing business) and effective (improving customer service) • Transportation • A critical ingredient for overall supply chain performance • The glue that holds the supply chain performance • The external forces driving the change • • • • • Globalization Technology Consolidation and integration Enlightened consumer Government policy and regulation Story of an iPhone The Fourth Industrial Revolution Supply Chain Concept (1) • Typical logistics network – Physical distribution Supply Chain Concept (2) • Integrated supply chain The purpose of transportation • Purpose of transportation • Overcome space • Fulfill a demand for mobility • Constraints • Distance – Relative concept involving space, time and effort • The capacity of modes and infrastructures • The nature of what is being transported Distance - a core attribute of transportation Historical significance of transportation • The growth of civilizations is directly associated with the development of transportation systems • A transportation system can help create a social structure However, methods of transportation can also tear societies apart • Transportation also plays a major role in national defense History of Transportation Economic significance (1) • The transportation service adds value to the goods shipped • Value of Goods • A commodity is produced at point A and costs OC at the point of production • The community that needs the commodity, located at point B, is the distance AB from A • The maximum price that people will pay for the commodity is shown on the vertical axis as OE, at community B • The efficiency of the new system enables the producer located at Point A to expand their market area to include B, which is a value-added service ... Point -to- Point and Hub-and-Spoke Networks Point -to- Point Hub-and-Spoke Hub Historical significance of transportation • The growth of civilizations is directly associated with the development of transportation. .. - a core attribute of transportation Transport Measurement Units • Freight: Weight-distance units  • People: Passenger-distance units  U.S Domestic Freight Ton-Miles by Mode (Billions) ton-mile... requirements • Security: Safety stocks and stock-out costs Core Components of Transportation Modes • Conveyances (vehicles) used to move passengers or freight • Mobile elements of transportation Infrastructures