GS 120 i Globalization Moving The Things We

GS 120 – i. Globalization: Moving The Things We Buy Professor: Dr. Jean-Paul Rodrigue Topic 6 – Intermodal Transportation and the Container A – Intermodalism B – Containerization Hofstra University, Department of Global Studies & Geography

A – Intermodalism Read section 1

Intermodalism and Transmodalism Read this content Intermodalism Origin Road Terminal Rail Maritime Destination Carrier Ticket / Contract Multimodalism Ticket / Contract Transmodalism Rail

Integrated Freight Transport Systems: Intermodal and Transmodal Connectivity Read this content Transloading facility Road Distribution Center/ Cross-docking On-dock rail Rail Thruport Mariti me Port container yard Intermodal Connectivity Transshipment Hub Transmodal Connectivity What are the fundamental differences between intermodal and

Modal Separation in Space: Europa Terminal in Antwerp Read this conte Barges Rail Trucks Deepsea services

Abu Dhabi, Major Transshipment Hub

Rail / Road Transloading Read this content

Major Steps in Intermodal Integration 1930 s Pallets Forklifts 1940 s 1950 s 1960 s TOFC (1952) Container (1956) 1970 s 1980 s 1990 s 2000 s Blockchain (2015) Rail deregulation Rubber-tired gantry (1985) Reachstacker (1985) Container gantry crane and Doublestacking (1985) straddle carrier (1959) Electronic bill of lading Advanced container Satellite terminals Dedicated container terminal (1962) Container standardization (1965) Inland container depots Transatlantic container services (1966) Automated terminal (1995) COFC (1967) Post-Panamax ship (1996) Cellular containership (1968) Read this content 2010 s

Pallets Loaded into a Train by a Forklift, 1940 s

Trailers on Flatcars (TOFC), 1950 s

What is a Container? ■ A standard metal box (ISO 668 standard) • 20 -foot box of 20 feet long, 8'6" feet high and 8 feet wide (One TEU; Twenty Foot equivalent Unit). • 40 -foot box. • 40 -foot ‘high cube’ box. 9’ 6” feet high. ■ Using common handling equipment • Moving between ships, railcars, trucks and barges. ■ The container is a load unit • • Can be adapted to carry different cargoes. Standard: General dry cargo. Tank: Liquid cargo (fuel and chemicals). Reefer: Refrigerated cargo (food).

First Containership, Port Newark, 1958

Cellular Containership, 1970 s

Containers on Flatcars, 1978 Doublestacking

Automated Guided Vehicles, Container Yard, HHLA Container Terminal Altenwerder (CTA), Hamburg

Digital Intermodalism: Blockchains and Intermodal Transportation Distribution Center Information Flows Distribution Center Inland Port Rail Ship Truck Physical Flows Operations Port Read this conte Truck Carrier Packaging Packing Palletizing Empty receiving Stuffing / Loading Certificate of origin Commercial invoice Packing list Insurance Gate date Booking Pickup date Order # Container # Equipment # Events Order Unloading Stacking Inspection Yard pick up Gate exit Gate entry Yard drop off Stacking Berth drop off Loading Trucking Bo. L Entry date Container # Customs clearance Yard slot # Loading date Demurrage Pickup date Events Container # Equipment # Events Arrival notice Master Bo. L Receiving Unstuffing Depalletizing Stocking Empty return Unloading Stacking Yard pick up Gate exit Unloading date Receiving date Container # Order # Customs clearance Yard slot # Container # Yard slot # Pickup date Demurrage Events Pickup date Container # Equipment # Events Rail Bo. L Trucking Bo. L Receipt Blockchain Smart Contracts Match consignment with Bo. L Pay supplier (CIF) Pay supplier (FOB) Match order, invoice, shipment Pay truck carrier Pay supplier (CIP)

Conditions for Intermodal Transport Conditions Outcomes Load unit Intermediate and finished goods in load units of less than 25 tons. Total transport costs Modal continuity Sequence of connected infrastructure; an intermodal transport chain. Modal shift Transport distance Distances above 500 km (longer than one day of trucking) usually require intermodal transportation. Suitable for intermediate cargo values. Low and high value shipments are usually less suitable. Cargo flows need to be continuous and in similar quantities. Consolidation X Cargo Value Frequency of shipments Read this content Higher load factor Less empty backhauls Explain under what conditions intermodal transportation is used. From economies of scale and the use of more effective modes and intermodal operations. Each mode according to their respective time and cost advantages. The requirement to consolidate and deconsolidate load units at intermodal terminals. Less LTL and more TL. Better utilization of existing capacity. Less vehicle-km of empty backhauls due to modal shift, higher load factor and consolidation.

Unimodal and Intermodal Transportation Unimodal Point-to-Point Networks C A Read this content Intermodal Integrated Network C A B B Transshipment Rail Road D D Transshipment F E Explain how an integrated intermodal network can be a more efficient form of transportation.

Distance, Modal Choice and Transport Costs Transport costs per unit C 1 ROAD C 2 C 3 RAIL D 1 Read this content MARITIME D 2 Distance

Freight Transport Revenue per Ton-Mile (in 2006 dollars) Read this conte $0. 90 $0. 80 $0. 70 $0. 60 $0. 50 $0. 40 $0. 27 $0. 30 $0. 20 $0. 10 $0. 01 $0. 02 Water Rail $0. 00 Road Air

Average Length of Haul, Domestic Passenger and Freight Transport, United States, 1960 -2016 (in miles) 2, 000 Read this conten 1, 800 1, 600 Freight 1, 400 Air carrier (cargo) Truck 1, 200 Class I Rail Coastal 1, 000 Air carrier (passenger) 800 Amtrak Intercity Bus 600 Commuter rail Passengers 400 200 0 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015

Modal Share of Freight Transportation, Selected Countries, 2008 (in % of ton-kms) 100% 90% Read this content 80% 70% Inland waterways 60% Sea 50% Pipelines Road 40% Rail 30% 20% 10% 0% EU 27 United States China Russia Japan Why Europe, the US and Japan have different composition of transport modes?

Intermodal Transport Chain Read this conten Composition ‘Last mile’ Interchange Transfer ‘First mile’ Decomposition Local / Regional Distribution National / International Distribution Transport Terminal

The North American Landbridge Read this content

The Eurasian Landbridge Read this conten Explain how the North American and Eurasian Landbridge are examples of

Short Assignment: The Choice of a Transport Mode Explain how distance and cost are factors in selecting a specific transport mode.

B – Containerization Read section 3

The Benefits of Containerization What is containerization • Lower freight rates • Lower insurance rates • Minimal load unit Transport Costs Read this content • Lower storage costs • Lower packing and packaging costs • Faster inventory Inventory turnover Costs • Time reliability • Higher frequency Service Level The container has become a dominant mode of global freight transportation. Explain the main reasons why.

Read this content Container Identification System Check digit calcula 3 2 1 1 2 3 4 5 5 4 Owner Code (3 letters): TGH Product Group Code (1 letter): U Registration Number (6 digits): 759933 Check Digit (1 digit): 0 Size & Type Code (4 digits/letters): 45 G 1 Operational Characteristics Maximum weight: 30, 480 kg Container weight: 3, 870 kg Payload weight: 26, 610 kg Cubic capacity: 2, 700 cubic feet

Common ISO Container Size and Type Codes Length Height Type 2 20 feet 2 8 feet 6 inches G 1 General purpose container 4 40 feet 5 9 feet 6 inches R 1 Refrigerated container L 45 feet “High cube” M 48 feet U 1 Open top container P 1 Platform container T 1 Read this content Tank container

Conventional Intermodal Terminal Equipment Straddle Carriers at ECT Delta Terminal Rotterdam Circulate over container piles. Can go over stacks up to 3 in height. Density of 500 to 700 TEU per hectare. Front-end Loader Use container top anchor points. Handle most containers. Can reach stacks up to 3 in height. Reach Stacker Flexible side loaders. Can reach stacks up to 3 full or 5 empty containers in height. 500 TEU per hectare. Read this content Rubber-tired Gantry High storage densities (1, 000 TEU per hectare). Difficult to move from one stack to the other. High acquisition but low operating costs. Rail-mounter Gantry Highest storage density (wide span; +1, 000 TEU per hectare); mostly used at port terminals. Lowest operating costs. Fixed to rail tracks. Portainer Load and unload containerships. Various sizes (Panamax and Super. Panamax). Rubber Tire Gantry Cranes working at Dublin Port

Composition of the Global Fleet of Containers, 2012 ■ 20 Foot Containers 31. 5 Million TEU 1% 8% • Carry heavier goods. • Running out on weight before run out of volume. 16% 7% ■ 40 Foot Containers 19% • Carry more volume then weight. ■ 40 Foot High-Cube • Highest volume available in maritime shipping. 49% 20 Foot 40 Foot High Cube Reefer Tank Others ■ Reefer • Carry refrigerated goods.

Number of Units and Weight of Standard Consumption Goods that Can be Carried by a 20 Foot Container Read this conten Refrigerators Weight Limit 5, 500 55 9, 792 Bananas 48, 000 12, 000 9, 600 Wine Bottles Flat Screen Televisions Payload Weight (kg) 4, 680 400 4, 648 6, 000 Pair of shoes 8, 279 Cell phone 12, 000 20, 388 Copying paper 1, 650 0 5, 000 10, 000 15, 000 20, 000 25, 000 30, 000 35, 000 40, 000 What is the difference between “weighting out” versus “cubing out” in 45, 000 50, 000

Containerization as a Diffusion Cycle: World Container Traffic (1980 -2017) Adoptio n 1000 900 1966 -1992 800 Vision and risk Accelerati on 1992 -2002 Million TEU Maturity 2002 -2008 - Massive diffusion Network complexities 700 600 Peak Growth Network development Productivity multipliers 500 Niche markets 400 300 200 Developing opportunities New (niche) services Productivity gains Read this content 100 0 1985 1990 1995 2000 2005 2010 2015

Containerization Growth Factors Growth Read this content Decline Derived • Economic and income growth • Outsourcing and offshoring • Complex supply chains • Economic recessions • Trade protectionism • Automation Substitution • Capture of bulk and break-bulk markets • New niches (commodities and cold chain) • Trade imbalances • Repositioning of empty containers • Peak substitution • Composition of container fleet • Transshipment (hubbing, relay and intersection) • Changes in shipping networks (more direct services) Incidental Induced • Trade protectionism • Automation

Containerized Cargo Flows along Major Trade Routes, 1995 -2018 (in million TEUs) 2018 20. 9 2015 7. 4 17. 5 2010 12. 3 2005 11. 9 2000 7. 3 1995 4. 0 0 6. 9 6. 5 4. 5 3. 5 2. 4 17. 4 4. 7 2. 5 6. 4 5. 7 4. 4 2. 7 20 3. 1 4. 9 4. 1 3. 2 Read this conte 2. 0 3. 7 1. 7 2. 0 1. 7 10 15. 0 13. 3 9. 3 7. 0 Why container flows are imbalanced and what happens with empty containers? 30 40 50 East Asia>North America>East Asia>Europe>East Asia North America>Europe>North America 60 70

The Container as a Transport, Production and Distribution Unit Read this cont TRANSPORT • Modes and terminals. • Intermodal and transmodal operations. PRODUCTION • Synchronization of inputs and outputs (batches). • Manufacturing cycles. DISTRIBUTION • Flow management (time-based). • Inventory in transit (warehousing unit).

Advantages of Containerization Advantages Standardization Flexibility Costs $ Velocity Warehousing Security & Safety Read section 4 ISO standard (modes and equipment). Unique identification number and size type code. Commodities, manufactured goods, liquids and refrigerated goods. How a container is made Low transport costs. Economies of scale at modes and terminals. Fast transshipment operations. Low terminal turnaround times. Own warehouse; simpler and less expensive packaging. Stacking capability. Contents unknown to carriers. Reduced spoilage and losses. Loading containership

Drawbacks of Containerization Drawbacks Site constraints Capital intensiveness $ Stacking Repositioning Theft and losses Illicit trade Large consumption of terminal space. Draft issues with larger containerships. Container handling infrastructures and equipment are important investments. Complexity of arrangement of containers, both on the ground and on modes. Divergence between production and consumption; repositioning. 20% of all containers. High value goods vulnerable to thefts, particularly between terminal and final destination. Illicit trade of goods, drugs and weapons, as well as for illegal immigration. Illicit shipments and the response of the Container Control Programme

Container Usage during its Life-Span 16% Read this content Ocean Transit Terminal 16% 56% Inland Use Repair 6% 6% Idle or Empty Repositioning

Stacked 40 -Foot Containers, Port of Yantian, China Read this cont

Loading Coffee into Containers, Cartagena, Colombia Why a commodity such as coffee is carried in containers? Read this con

40 -Foot Containers Doublestacked on a Rail Car Read this conte

40’ Reefer Container

20 -Foot Tank Containers Read this content

The Ultimate “Kegger”

Reuse of a Discarded Container (South Africa) Discarded containers have many uses. Searching to web, provide some examples about how Read this conte

Containerized Housing Units, Le Havre, France Read this cont

Container Turned in a Swimming Pool…

Short Assignment: “The World in a Box” The container has several advantages and drawbacks. Provide a succinct explanation of the advantages and drawbacks you think are the most