Supply Chain Frontiers issue #9. Read all articles in this issue.
The MIT Center for Transportation & Logistics (CTL) has launched a major initiative to develop solutions to the freight congestion problems that threaten to overwhelm the nation's transportation system. The first stage is an industry survey that CTL is sending out in mid-June. The results of the survey will be used by a research group CTL is forming called the Transportation Research Group. The group, which crosses industries, modes, and public/private sectors, will find ways to remove the capacity constraints that impede the flow of goods both domestically and internationally.
"We hear a great deal about transportation bottlenecks and the huge cost of freight delays, but our focus is on finding ways to develop both short- and long-term solutions to these problems," said Chris Caplice, Executive Director, Master of Logistics in Engineering program, and director of the new research group. As a neutral party and center of excellence in supply chain research, CTL is ideally placed to bring industry and government stakeholders together to explore the issues and come up with real-world solutions, he noted.
The extent of the problem was highlighted at the recent invitation-only CTL symposium "Managing Uncertainty in Both Supply and Demand". More than 60 companies and government representatives gathered to talk about ways to bring relief to a transportation network hampered by ports choked with cargo, overtaxed rail links and truck capacity shortages.
The U.S. Department of Transportation estimated that the country's transportation system carries in excess of 15 billion tons of freight annually valued at more than nine trillion dollars. Freight volumes are projected to increase by 50 % in the next 20 years on a network already under immense stress. The US freight transportation infrastructure is insufficient for handling the current, much less the projected, traffic, said Caplice.
Building urgently needed transportation infrastructure is politically difficult, however, and can take years or even decades to complete. Another complication is that freight transportation networks are highly interdependent and involve a multitude of players from the public and private sectors, yet no single entity owns the entire process. "As an industry and a nation we have the ability to overcome these problems if we apply ourselves and act quickly, thoughtfully and with resolve," Caplice said.
Symposium attendees related how they are coping in the short term with overstretched freight networks, and suggested ways to ease the burden on shippers, carriers and other stakeholders. Some of the ideas are summarized below.
- Explore the possibility of demand shifting. One carrier noted that traffic levels are relatively light on weekends, yet most shippers do not receive or allow pick ups on these days. By better utilizing all of the hours in a week, the industry can discover hidden network capacity.
- Use the right mode for the right moves. For example, putting more cargo on trains, particularly in congested port areas, would ease the strain on roads and alleviate driver shortages. Do the math and the logic becomes clear: a train carrying 250 containers has just two drivers, and rail carriers are negotiating to reduce this to a single driver. Similarly, using dedicated fleets in lieu of for-hire carriers within selected regions can increase capacity and reduce total costs.
- The rail mode has capacity problems of its own and carriers are implementing measures such as laying double and triple tracks, and outsourcing short line rail systems to specialist operators so the primary carrier can concentrate on long-haul services.
- Intermodal operators are looking to by-pass rail bottlenecks by de-ramping in cities and using trucks to carry cargo to less congested sections of the rail network. A study is looking at possible ways to improve the efficiency of the hand-offs in multi-modal transportation systems.
- Pre-packing ships for specific train destinations and dedicating dockside trains to specific ports is a way to increase port throughput. The idea is to boost capacity by decreasing dwell time. Called the Agile Port System, the concept was tried out in Tacoma and capacity was doubled without adding port infrastructure. Extending port terminal opening hours also helps to free up capacity. A leading shipping line is investing in a private port free of the labor issues that crimp productivity.
While measures such as these are bringing some relief to delay-prone parts of the transportation network, a larger, more concerted effort is needed to address the broader challenges of capacity constraints. This is where the Transportation Research Group comes in. "We are inviting industry and government stakeholders to join the Group, to get involved, so we can avoid a crisis that could undermine economic growth in the United States and elsewhere," Caplice said.
For more information on joining the Transportation Research Group contact Chris Caplice at: caplice@mit.edu. Readers are encouraged to complete the CTL Transportation Infrastructure Survey, which will be emailed to them.