Supply Chain Frontiers issue #50
A major impediment to the flow of freight traffic in megacities – cities with a population of at least 10 million people – is misguided regulation. The best way to analyze the effects is to view them at ground level. This is what an MIT SCALE Network Latin America research team did in São Paulo, Brazil.
The Massachusetts Institute of Technology and the University Of São Paulo (USP) collaborated on the project. The Itaú Fund for Research on Sustainability in Latin America sponsored the research.
São Paulo’s traffic problems are in a class of their own. Still, the initial research findings offer insights that are valuable for any government or private sector organization with a vested interest in improving the movement of freight vehicles in megacities.
The 20 million or so inhabitants of São Paulo are packed into an area of almost 8,000 km² that covers 39 municipalities. The central municipality of São Paulo alone qualifies as a megacity with some 11 million citizens.
More than 4.5 million buses, cars, and trucks cause monumental traffic jams in the city. Moreover, congestion issues are getting worse. In the last five years, some 1.3 million new vehicles were registered in the municipality of São Paulo, a 21% increase in the size of the fleet.
Delivery vehicles serve the needs of about 200,000 commercial establishments in the São Paulo municipality. Traffic congestion delays deliveries to these businesses and generates huge volumes of carbon. A 2010 local government report estimates that 12% of the 257,000 tons of air pollutants emitted by motor vehicles in the city come from delivery vehicles.
Since 1982, São Paulo’s local government has been implementing and modifying various public policies to control the movement of freight traffic in targeted areas within the city.
One approach has been to encourage the use of small goods vehicles that can easily navigate São Paulo’s crowded streets, which has resulted in the proliferation of so-called urban freight vehicles (VUCs). But even these nimble mini-trucks are restricted by regulations, which specify where and at what times VUCs can make deliveries within city limits. There are exceptions tied to the nature of certain loads and businesses – postal and emergency vehicles, for example – that further complicate this web of regulation.
A larger vehicle, called a TOCO, is also used to deliver freight in the city. They have twice the capacity of the VUC model, and also face heavy restrictions on how they can operate.
Researchers from MIT and USP collected data on the movement of these vehicles in two ways. In “city exploration” exercises, small groups of researchers observed specific aspects of delivery operations such as street configurations, parking facilities, and the number of destinations in specific urban areas. Secondly, “route shadowing” activities focused on companies’ last mile operations by following delivery vehicles and observing key features such as arrival/departure times, and the number of deliveries completed.
Using this data, the researchers developed analytical models to analyze the impact of two typical urban freight policies: vehicle size and weight restrictions, and regulations pertaining to delivery time windows. The work produced some interesting findings.
For example, in most cases, the larger vehicle is the better choice when capacity and delivery windows are not imposed by the regulators. But the TOCO is not a good choice when short delivery windows are mandated. Given their larger capacity, there is insufficient time to complete all the deliveries on a route using a TOCO, which increases the number of half-empty vehicles. In this case, a time window policy without corresponding capacity regulation will result in an increase in CO2 emissions. The analysis also showed that, depending on the density of customers in a region of São Paulo, a good option might be the deployment of vehicles slightly bigger than the VUC model or to incentivize greener versions of the TOCO.
The time taken to find parking spaces is crucially important in terms of operational efficiency. One way to mitigate the effects of a scarcity of spaces is to reduce linehaul distances by changing the location of distribution centers. But the research indicates that the reduction in carbon emissions as a result of this strategy is insignificant.
The researchers recommend that to be more effective in reducing the CO2 emissions as well as the number of delivery vehicles on São Paulo’s streets, a delivery time window policy could be implemented in conjunction with more parking spaces in extremely dense areas. They also recommend a tailored approach to policy making that takes neighborhood characteristics into account to minimize the unintended environmental consequences of regulatory codes.
Further research into megacity freight vehicle movements is underway. The work is shedding new light on the real-world consequences of traffic regulations in megacities or any other dense urban area in smaller cities, and will hopefully help regulators and companies to develop more effective traffic management policies.
For more information on the research contact Dr. Edgar Blanco, Founder and Director of the MIT Megacity Logistics Lab.