The modern world can be characterized by the extremely high speed of urbanization. The given tendency is the fundamental one as it preconditions the evolution of societies and the appearance of new trends. At the same time, the rapid rise of cities and the emergence of megapolises mean that people have to cover huge distances to reach a particular area or place. Under these conditions, the question of transportation acquires the top priority as people want to have a simple, efficient, and cheap ways to move across cities and reach destination areas. That is why there are numerous appeals to increase the efficiency of mass transit.
Background
Today numerous individuals use their vehicles to increase their mobility and move from one end of a city to another. However, there are people who either do not have an opportunity to buy a car or prefer to use some other means of transport because of different reasons. At the same time, the gradual rise of big cities and the tendency towards further urbanization precondition a significant increase in the number of new cars, which will obviously become a problem in the future (Patton, 2017). That is why the reconsideration of the approach to the public transit system and the use of specific pricing models could become a perfect solution to the problem of transportation in big cities (Patton, 2017). Additionally, mass transit has several advantages which make it more attractive to the population and justifies the need for its improvement.
Environmental Concerns
Among the factors impacting Americans preferences and the use of mass transit environmental issues hold leading positions. The fact is that a significant shift in peoples mentalities can be admitted today. The critical deterioration of the environment is to a greater degree associated with the increase in vehicles in big cities (McMahon, 2013). The use of public transport can be considered one of the possible solutions to the problem (Patton, 2017). That is why Americans might prefer using mass transit to avoid unnecessary emissions and contribute to the improvement of the environment.
Congestion
The second factor affecting peoples choice is the increased number of traffic congestions and numerous problematic issues related to it. All big cities face this problem because of overpopulation and the growing number of private vehicles (Ceder, 2015). The growth of peoples well-being and the introduction of affordable automobiles stipulate the appearance of numerous cars in megapolises streets. For this reason, during rush-hours people suffer from the inability to reach particular places because of traffic jams (Ceder, 2015). In this regard, the use of the public transit system becomes an appropriate alternative for them regarding the lack of time and the necessity to avoid lateness.
Affordability
Finally, another factor that might stipulate the choice of the public transit system is its affordability and broad coverage. The fact is that despite the tendency towards the gradual increase in the number of cars across the population there are still categories that are not able to afford their private vehicle (Abdallah, 2017). In such a way, public transit becomes the only available method to reach destination points (Abdallah, 2017). At the same time, the developed public transportation system peculiar to some cities, especially old ones, provides individuals with an opportunity to move to areas that cannot be reached by cars or other personal vehicles (Abdallah, 2017). For this reason, they might prefer using the public transit system for their own purposes.
Pricing Strategies
In such a way, the reasons suggested above demonstrate that mass transit remains topical regarding the existing urbanization tendencies and the increased number of cars. At the same time, the high speed of population growth means the constantly increasing demand for transportation services. In this regard, it is critical to attaining improved utilization of transportation facilities within metropolitan areas to guarantee that all individuals needs will be satisfied and the public transit system will preserve its topicality. Among numerous approaches suggested as a possible solution to the problem, pricing could be considered the most efficient one because of the high potential of this measure.
Thus, there are several possible models with an emphasis on the financial aspect of the issue. The improved coordination of local transportation could be achieved by the more economical distribution of traffic and a fair price suggested by passengers (Vickrey, 1965). In other words, a flexible pricing system that considers the peak and off-peak usage along with the covered distance can help to improve the efficiency of the system and attract new passengers including those who used vehicles (Vickrey, 1965). The fact is that by the statistics the public transit usage becomes much higher during rush hours even if compare with vehicular traffic (Vickrey, 1965). However, if there is no differentiation between peak and off-peak charges, public transit demonstrates poor showings (Vickrey, 1965). For this reason, one of the possible solutions to better utilize transportation facilities is to reconsider the approach to pricing by subsidizing public transit at the expense of vehicular traffic (Vickrey, 1965). It will help to decrease the level of congestion and provide buses with an opportunity to suggest satisfactory services to all passengers.
One more possible way to improve utilization of public transit is the introduction of specific equipment to determine the covered distance and calculate a fair price for passengers. The given approach presupposes the use of identification units that will be scanned by roadside devices placed at zone boundaries (Vickrey, 1965). In such a way, the system will be able to monitor all alterations in the position of a vehicle and provide data that can be used to calculate a fair price and offer passengers an opportunity to use improved services. The introduction of the given pricing method is expected to improve the utilization of facilities by suggesting extra funds that can be used to sponsor the further development of the sphere and precondition its stable functioning.
Conclusion
Altogether, despite the gradual increase in the number of private vehicles, the public transit system remains topical and demanded. There are several advantages that it guarantees to users. First of all, people in the USA might prefer using public transit because of environmental concerns as it helps to reduce the number of emissions and improve the situation. Second, the rise of metropolises means the increased number of people and cars on the streets which results in traffic problems and congestions during peak hours. For this reason, using buses individuals might avoid these problems. Finally, it remains a more affordable way to reach some areas. That is why there is a need for the further utilization of facilities to align their efficient functioning. The appropriate pricing strategy becomes one of the measures to regulate this aspect. The differentiation between peaks and off-peaks along with the determination of the covered distance will help to implement this new strategy and make it efficient.
References
Abdallah, T. (2017). Sustainable mass transit: Challenges and opportunities in urban public transportation. New York, NY: Elsevier.
Ceder, A. (2015). Public Transit planning and operation: Modeling, practice and behavior (2nd ed.). Boca Raton, FL: CRC Press.
Patton, C. (2017). Public transit operations: The strategic professional. New York, NY: Switchpoint Press.
Vickrey, W. (1965). Pricing as a tool in coordination of local transportation. In Universities-National Bureau (ed.), Transportation economics (p. 275-296). New York, NY: UMI Research Press.
International transport services depend on intermodal terminals as they can be considered their key access points. Therefore, while developing an intermodal terminal, one should pay attention to the various factors that can affect the efficiency of the terminal before, during, and after its creation. It is possible to distinguish many aspects that should be considered in the process of development. However, the most important ones are a suitable location, the speed of throughput, profitability, flexibility, safety, and reliability.
First of all, the location of a future intermodal terminal can influence the transport system’s competitiveness. The accessibility of the location can benefit both end customers and suppliers. According to Ližbetin and Caha, the chosen location can affect the system’s accuracy and speed of operations, factors that determine the service’s reliability (100). For example, the time of delivery for a particular product may depend on the placement of the intermodal terminal.
Such aspects as the distance of the terminal from the central industrial zones, river or seaports, railway stations, and airports should all be taken into account (Roso et al. 505). Furthermore, the availability of the terminal and the possibility of future expansion should also be considered, as the continuously changing economics of countries may affect customer’s demands. Therefore, the location of a terminal should adhere to some fundamental rules. It should not only be easily accessible but also flexible. The position of the future terminal should be able to withstand changes in the environment and be close to, or easily reachable from, the main channels of transportation.
The criteria of legislation and environmental concerns should also be taken into account. Various countries, and cities, have different rules about building such structures as an intermodal terminal. For example, some restrictions on urban planning may apply in this situation. Furthermore, the issue of environmental protection should not be overlooked. It is necessary to assess the environmental impact that the establishment of a terminal can cause.
It is especially significant if the products or materials that will be transferred through the terminal could pose a threat to human health. In this case, the position of an intermodal terminal may only be chosen according to the country’s environmental and health regulations (Roso et al. 504). Furthermore, the level of pollution may also be affected by the operations of the terminal itself. For instance, the noise level of an intermodal terminal may disturb the surrounding areas. The pollution caused by construction should also be included in these considerations. Thus, choosing a suitable location and adhering to the rules is vital during the process of development.
The terminal’s design should be evaluated at all stages of its development. The chosen design can affect a terminal’s safety, which is centered on transferred goods, people who participate in the process, and vehicles that are used during transportation (Slack 269). At this stage, the design of a terminal becomes the primary focus of development. Moreover, efficient terminal design can also result in reduced costs and a higher speed of throughput. The type of equipment utilized and the layout of the terminal is vital to its work. For instance, the placement of facilities can either positively or adversely affect the operation of the whole terminal.
Furthermore, the amount of equipment is also significant. According to Ližbetin and Caha, the operating technology implemented in the terminal affects multiple aspects of the terminal’s work (100). First of all, it determines the time one spends in the terminal during the transfer. Secondly, the accuracy of the operations is also dependant on the working equipment. Furthermore, the aspect of punctuality also partially relies on the technology of the terminal, as its work can either speed up or slow down some processes.
The speed of operations is usually counted with the use of “mean loading finish time” (Caris et al. 283). Thus, this aspect affects the terminal’s performance. The time allocated for every part of the process should be minimized to enhance the terminal’s performance. Such factors as design and location, along with the terminal’s infrastructure, all affect the speed of throughput. Decisions regarding the chosen infrastructure of the terminal should be strategic and elaborate.
For example, Caris et al. propose some possible choices that can be taken to improve the speed of operations (285). For instance, some terminals can predict the demands of customers and prepare for necessary services ahead of time. Such a strategic decision can improve the speed of throughput and eliminate the possibility of waiting. The location of units in the terminal can also affect the speed of services. Moreover, crew and service scheduling is also essential in making terminals more effective.
Caris et al. also outline such concerns as the distribution of containers, scheduling jobs for workers of the terminal, and optimal assignments of vehicles for further transportation (293). Here, the planning of such aspects can affect the efficiency of the terminal. One should be concerned with these factors before and after constriction, as the workload of terminals can change over time. Zajac and Swieboda support these ideas and add that the rationalization of one’s actions can significantly increase a terminals’ productivity, eliminate errors, and enhance the level of safety (573). Therefore, the development of a terminal continues after its establishment.
The proper functioning of a future terminal also depends on the cost-effectiveness of its services. According to Zajac et al., the possibility of some reductions should be taken into account while developing an intermodal terminal (8). Time reduction, for instance, can significantly affect the effectiveness of a terminal and also result in lower costs. One can devise a layout for the terminal that will allow for shorter loading and unloading time. Moreover, the number of operations that are performed by workers in the terminal can be reduced as well. The authors report that these changes may increase the productivity of machines and save money.
Finally, the sum of these aspects affects the terminal’s competitiveness and profitability. As Zajac and Swieboda point out, the increasing levels of performance are necessary for terminals to compete with road transport successfully. One can achieve better performance and lower costs with tactical planning (Morash and Clinton 15). All in all, such factors as location, design, the speed of operations, infrastructure, cost-effectiveness, safety, reliability, and competitiveness should all be taken into consideration during the development of an intermodal terminal.
Countries’ Freight Transport
Road and rail freight transport in different countries can develop according to various principles because of the countries’ history, location, and population. The use of road transport is one of the leading ways to deliver goods. Rail transport is also one of the earliest methods of freight delivery. However, it is subject to several limitations. In many states, railroads are still used as the primary means of freight transportation.
The comparison between such countries as Australia and the US can be especially striking as their processes of development strongly depended on geography and availability of resources. The following evaluation will examine the information about Australia and the US during the years 1979 – 1999. This period can be characterized by the decline in the use of trains in the US and the increasing popularity of road transportation. Indeed, both Australia and the US started to rely on cars. However, their relationship with rail transport differed significantly.
Comparison of Freight Tasks
Currently, the US has one of the most extensive rail networks in the world. Before the Staggers Rail Act of 1980, the freight rail transport industry in the US was heavily regulated (Button and Pitfield 52). However, since that time the deregulation of the industry has brought many changes to the business. The rail network of this continent was developed and complicated, as it was established much earlier, and had expanded continuously (Ausubel and Marchetti 21).
Australia’s rail network, on the other hand, was created from independently built railways in different parts of the country. This type of progression could be explained by the state’s geography. Road transportation in both countries was broadly developed during this period as cars gained more popularity in the US, and were the only option in Australia.
In the US, rail transportation was especially important to the economy until 1950. The second half of the century brought a decline to this industry due to the occurrence of new alternative transport modes. Thus, the period from 1979 to 1999 saw a decrease in the use of rail transport as cars began to become more popular and widely used (Button and Hensher 26). However, rail transportation for the industry was still significant.
There were several services provided by US road and rail transport. First of all, coal was the primary cargo of railroads, accounting for approximately forty percent of total transported products at the end of the twentieth century. In 1979, the carload of coal was significantly lower, which showed the growing need for coal in the country. Secondly, various farm products were also mainly transported by rail. In this situation, the popularity of railroads could be explained by the growth of domestic markets and increased export rates.
Train networks also helped move various hazardous products which could not be transported by usual cars. Privately owned tank cars and rail wagons transferred chemicals and other dangerous materials across the country safely. The rail transportation of such materials only increased over time due to improving safety measures. As Button and Pitfield point out, railroad transport was perfect for moving this type of goods as it was safer than other vehicles and more developed at that time (11). Finally, the US saw an increase in transportation equipment being moved by rail. The domestic automobile business grew, as did the railroad car loadings.
Freight tasks of the road industry mostly dealt with less-than-carload transportation. The increase in freight transportation by car influenced the business and shifted some of the load from trains to other modes of transport.
Australia did not see a similar increase in its freight tasks on road and rail. Australia adopted containerization somewhat early due to its trade agreements with Europe. However, its development was slower than that of the US (“Freight Network”). The country’s road and rail transportation were mostly used for internal movements and delivery from a supplier to a seaport. This country developed other ways of transportation more actively as international trade was more accentuated.
Moreover, most of the railroads were controlled by the government, which further limited the industry. Thus, while the number of shipping containers grew in the country, its railroad network did not advance at the same speed. Rail transportation did not increase significantly until the beginning of the twenty-first century. The country’s road transport network was more developed during this period. Australian companies heavily relied on roads as rail transportation was hard due to the inconsistent population of the territory. Australia had many highways that created a network of tracks throughout the country.
Factors Affecting Freight Transport
The geography of the US greatly influenced the development of rail and road transportation. First of all, after their creation, railroad networks became the most used type of transportation for almost every industry as they were easy to maintain and build. Moreover, the size of the country also affected the development of this mode of transport. The population in the US was dispersed more consistently throughout the country compared to Australia.
Thus, the development of railroad networks was possible due to people being present in all parts of the state. Australia, on the other hand, would not benefit from a system of railroads due to it being populated mostly near sea and ocean ports (“Freight Network”). The center of the country had an environment that was unfit for the industry. It is possible that this factor greatly influenced the process of railroad establishment in Australia. Roads, on the other hand, became increasingly important in Australia, as the country did not have any other means of transporting goods internally.
In the US, freight railroads regained some of their significance due to the rise of international trade in the 1990s. Furthermore, the Staggers Act contributed to the revival of rail networks as well. This act brought changes to the way railroad operations were regulated and provided carriers with a more favorable environment. Private organizations owned rail freight transport. Road transportation gained popularity during this time due to its mobility and versatility.
Moreover, cars took over the portion of the business that dealt with less-than-carload orders. While railroads mostly worked with bulk products, road transport had more demand in other areas of the industry. Various highway systems changed the freight industry and made road transportation more widespread throughout the country. The number of trucking companies, for instance, increased after the Motor Carrier Act which was passed in 1980. This act deregulated the industry and positively influenced the development of road freight transportation.
On the other hand, Australia’s railroads were owned and controlled by the government (“Freight Network”). Freight transportation was not supported due to this regulation being very rigid. However, the changes in the industry included the deregulation of rail transport and increasing road development. While the industry was dominated by ships and cars, railroads gained some attention as well. Australia did not have the same amount of roads as the US.
Moreover, in the twentieth century, the US already had a highly developed network of railroads, while Australia had only separate developments in different parts of the country. Thus, it was easy for US companies to turn back to using railways in the 1980s. Australia, on the contrary, never heavily relied on rail transportation in the first place. While the deregulation act of 1980 increased the number of private businesses in the state, the use of these modes of transportation did not become prevalent in the industry.
Works Cited
Ausubel, Jesse, and Cesare Marchetti. “The Evolution of Transport.” Industrial Physicist, vol. 7, no. 2, 2001, pp. 20-24.
Button, Kenneth J., and David A. Hensher, editors. Handbook of Transport Systems and Traffic Control. Emerald Group Publishing Limited, 2001.
Button, Kenneth, and David Pitfield, editors. Transport Deregulation: An International Movement. Springer, 1991.
Caris, An, et al. “Planning Problems in Intermodal Freight Transport: Accomplishments and Prospects.” Transportation Planning and Technology, vol. 31, no. 3, 2008, pp. 277-302.
“Freight Network.” Australian Government. 2015. Web.
Ližbetin, Ján, and Zdeněk Caha. “The Optimization of the Intermodal Terminals.” NAŠE MORE, vol. 62, no. 3, 2015, pp. 97-100.
Morash, Edward A., and Steven R. Clinton. “The Role of Transportation Capabilities in International Supply Chain Management.” Transportation Journal, vol. 36, no. 3, 1997, pp. 5-17.
Roso, Violeta, et al. “Inland Intermodal Terminals Location Criteria Evaluation: The Case of Croatia.” Transportation Journal, vol. 54, no. 4, 2015, pp. 496-515.
Slack, Brian. “Intermodal Transportation.” Modern Transport Geography. 2nd ed., edited by Brian Hoyle and Richard Knowles, John Wiley & Sons, 1998, pp. 263-289.
Zajac, Mateusz, and Justyna Swieboda. “An Unloading Work Model at an Intermodal Terminal.” Theory and Engineering of Complex Systems and Dependability, edited by Wojciech Zamojski et al., Springer, 2015, pp. 573-582.
Zajac, Mateusz, et al. “Analysis and Evaluation of Selected Transport Processes in the Inland Intermodal Terminal.” The International Journal of Transport & Logistics, vol. 14, 2014, pp. 1-9.
In a few past decades, the importance of logistics in the modern global trade has drastically increased. Due to globalisation, the present-day logistics and transportation environment has transformed and became highly sophisticated and complex. Therefore, both maritime and inland transport industry are currently undergoing the process of restructuring. As a result, new trends leading to further consolidation of the market, greater integration and collaboration among diverse members of the logistics chain have appeared.
Ports play a significant role in this change process because, nowadays, not only they function as maritime-inland interfaces but also perform many other value-added logistics services. The extent to which ports develop, integrate, and implement intermodal transport infrastructures in various operations may largely define their competitiveness. Regionalisation is one of such integration strategies aimed to increase the ability of ports to control and capture hinterlands.
As observed by Monios and Wilmsmeier (2013), the word “region” in the concept of port regionalisation can be regarded as nothing but hinterland (p. 161). The port regionalisation concept also refers to “multi-port gateway region” − the term defining a “number of ports competing to serve an overlapping hinterland, and intermodal connections as well as suitable logistics structures…paramount to capture and control these areas” (Monios & Wilmsmeier, 2013, p. 161).
In a broader sense, it is possible to say that each transport terminal has a hinterland represented as an aggregate of customers (manufacturing enterprises, trade networks, etc.) with which it interacts. The given operational interactions include the shipping of freight, which goes through the terminal transhipment after reaching a particular distribution point. All these transfer operations will always be limited by a certain territory that can be divided into the main hinterland and the competition margin.
The main hinterland can be defined as a zone in which the terminal serves the predominant share of freight flows, while the term “competition margin” refers to a zone where the terminal competes with other terminals for cargo flows (Rodrigue & Notteboom, n.d.). Within the competition margin, the level of rivals’ competitiveness will be largely determined by spatial accessibility, quality, costs, and reliability of services.
Port regionalisation is essential for capturing of the mentioned competitive advantages. In the given report, the focus will be made on such characteristics of regionalisation as inland terminal development, inland logistics, and collective action. The literature review findings will be applied to the analysis of ports of Sines and Cork.
Literature Review
Inland Terminal Development
The increasing demand for inland freight distribution emphasises the need to improve the physical capacity of the transport systems from the intermodal perspective. As stated by Rodrigue and Notteboom (n.d.), to achieve this, ports should expand their physical capacity and find the sources of funding for this. Monios and Wilmsmeier (2013) note that terminal developments supported by the public sector “due to motivations of regional development” prevail in Europe, while “state involvement is becoming more common as a risk mitigation strategy in large intermodal schemes in the United States” (p. 164).
Although any facility expansion project sponsored either by the private or the public sector subject to similar planning approvals, the private enterprises often cannot deal with various planning conflicts, which arise when both ports and landside actors pursue similar developmental goals to increase their competitiveness within a limited area (Monios & Wilmsmeier, 2013). Such conflicts of interests may result in oversupply of terminals and fragmentation of flows. Thus, when port regionalisation strategy is coordinated with and supported by the state authorities, the chances for success increase.
There are many competitive advantages that ports may generate when using inland terminals incorporated within logistics zones. As stated by Rodrigue and Notteboom (2012), inland facilities or dry ports provide a chance to improve the quality and timeliness of shipping, increase the throughput capacity of seaports and access corridors as a result of accelerated cargo handling in ports, decrease total transport and storage costs, achieve greater ecological sustainability, and so on.
The realisation of the listed advantages becomes possible if the moment of an inland terminal exploitation matches the moment when the port encounters intense transport bottlenecks due to a limited throughput capacity. Additionally, for better results, the port management must choose the most optimal location for inland terminals, as well as select an appropriate size of the facility and sufficiently equip it with the necessary technology.
Thus, during the strategic planning stage, the management should assess new facilities based on expected intensity and inconsistency of input cargo flows and vehicle flows; location of the inland terminals and transport communication routs between them and the seaport; size and processing capacity of both the port and inland facilities; the costs of constructing the dry port and the overall exploitation of the seaport-terminal system (Rodrigue & Notteboom, 2012).
Inland Logistics
The development of multimodal transport networks can provide new opportunities which, in their turn, can have a significant impact on the associated logistics operations. The development of transport corridors enhances the polarisation and zoning of logistics facilities in proximate transport hubs and along communication axes between them (Rodrigue & Notteboom, n.d.). At the same time, logistic companies often appear close to each other as they are attracted by the same territorial factors: proximity to markets, availability of intermodal transport and the availability of support services.
The geographical concentration of logistics companies, in turn, causes the appearance of a synergistic effect, which makes a particular hinterland even more attractive for cargo owners. Such logistic poles, appearing in places of accumulation of logistics facilities, connect the strong orientation to intermodal transport with cluster advantages. Through regionalisation, ports can integrate their logistics operations into one of the logistics pole and receive an opportunity to capture the production, distribution, and consumption flows within the complex web of global trade activities.
As stated by Rodrigue and Notteboom (n.d.), “the logistical hinterland is a matter of flows, how they are organized and how they are taking place considering the existing macro-economic and physical settings” (p. 10). For successful control over hinterland, ports must actively manage the regional freight distribution through contracts with other players in the logistics market, e.g., rail and road transport firms, etc.
It means that along with the expansion of terminal operations and greater port access, global ports should aim to both capture maritime distribution networks and develop inland logistics infrastructures. Therefore, the choice of transportation modes, as well as the synchronisation of maritime and inland freight flows, becomes the major challenge. Other issues also may include the need to address congestion and increasing costs associated with higher throughput maritime-land interface due to the increased port access (Rodrigue & Notteboom, n.d.). The shift towards new transportation modes and distribution channels may be one of the best ways to enhance port hinterland efficacy.
Collective Action
As stated by Monios and Wilmsmeier (2013), “the planning and operation of intermodal corridors require multi-scaled governance and informal regional coherence that port actors are not generally in a position to influence” (p. 168). The researchers observe that large logistics operators competing against each other in the market are usually lack the motivation to cooperate. However, the collective action is one of the primary requirements for successful port regionalisation (Monios & Wilmsmeier, 2013). The findings indicate that a supportive public infrastructure should be developed to address the issues of firms’ reluctance to act together.
According to Monios and Wilmsmeier (2013), “a specified institutional structure and governance regime can be important elements of corridor success, whether for attracting funding, resolving operational problems or harmonising regulations at border crossings” (p. 167). Although traditionally port authorities are not involved in the process of instructional structure development, due to fierce competition within hinterlands, many of them aim to drive port regionalisation efforts and attempt to expand their institutional capacity beyond their conventional core competencies such as container handling (Monios & Wilmsmeier, 2013). Despite this, port governance remains substantially dependent on multiple circumstances of institutional and public character, as well as private investments.
Port of Sines: Analysis
Starting from 2003, Port of Sines began to exploit the containerised segment actively. As a result, it has been released of dependency on the petrochemical industry and gained new opportunities for cargo diversification and further growth (Moreira, 2013). In this regard, the port authorities, plan the development of new industrial and logistics hubs along the distribution chain through the involvement of new market actors in the process. Considering the future trends in the development of maritime routes, the reformatting and expansion of Port of Sines can significantly improve its competitive position in the global market.
Inland Logistics
The main factor defining the need for Port of Sines’s further expansion of its distribution networks, i.e., rail and sea, is the trend for the larger sizes of sea vessels, which pass through the Panama Canal, as well as the increase in the trade flow with Mercosur (Moreira, 2013).
Currently, the port controls the inbound and outbound freight traffic and serves as an interface between regional, national and global systems (Moreira, 2013). It actively develops corridors that are becoming of tremendous support for cargo owners that want to access Sines hinterlands through which the port captures the inland distribution system. In the future, the port authorities plan to increase the control of those distribution channels to ensure a sustainable flow of the containerised cargo (Moreira, 2013).
Moreira (2013) forecasts that as the trade via the Panama Canal will increase, and the need for reduced transport cost due to high fuel prices will grow, within the competitive hinterland the demand for the rail transportation will rise compared to road transport over the long haul. Therefore, if Port of Sines will successfully capture the railway distribution channels, it is going to emerge as a new strategically important global maritime network node and a gateway.
Nevertheless, to achieve this, all involved players must cooperate to create transitional networks required to support the redistribution of freight on land. If all the necessary changes are made − rail links are established, overall port performance and infrastructure are improved, and collective action is provided − Port of Sines will be able to obtain a higher status within the global port hierarchy.
Port of Cork: Analysis
In 2007, the Port of Cork Company started to plan the development of a container terminal and multi-purpose Ro-Ro berth at Ringaskiddy deep-water port and ferry terminal (Port of Cork, 2013). The new facilities will largely facilitate the port’s bulk goods handling and transferring of container handling out of its existing facilities at Tivoli and the City Quays in Cork Docklands. As a result, the company will have an opportunity for sustainable integration of non-industrial activities. The primary advantage of the newly expanded facilities will be the ability to handle deep-water shipping and accommodate larger vessels.
Terminal Development
It is possible to say that the major factor contributing to the port’s regionalisation plan is the current local limitations: scarcity of available space for further development, current trends in vessel size growth, increased loads on the system of the port region leading to bottlenecks and ecological problems. For instance, in the Ringaskiddy Port Redevelopment report, it is observed that the existing Tivoli and Cork Docklands cannot handle large vessels due to physical constraints (Port of Cork, 2013).
Additionally, since most of the Port of Cork Company’s container handling facilities are now located at Tivoli, the HGVs traffic passing through the City Centre road network is excessively heavy (Port of Cork, 2013). Thus, not only can the investment project create new opportunities for the port but also support the sustainable development within Cork.
It seems that the new terminal development at Ringaskiddy is largely supported by the national authorities. According to the National Ports Policy, Cork is going to be one of three Irish core ports in the Connecting Europe Network (Port of Cork, 2013). Moreover, it is considered that new deep-water facilities are essential for the commercial viability of the port and the region as such. It means that the facility expansion project is aligned with national development objectives. Since Port of Cork plays a strategic deep-water role, the capacity of the port to achieve the extended gate inland integration may be substantially facilitated.
Inland Logistics
New facilities will only provide a platform. Nevertheless, upgrades in infrastructure and inland logistics will be required as well. Since the relocation of terminal facilities to the Ringaskiddy site is justified by their greater proximity to the port’s major customers, the project may result in better operational cost efficiency. However, some problems may arise during the project implementation. For example, it is expected that at full capacity, the Ringaskiddy proposal will generate “a total of 3,550 vehicle movements per day, of which approximately 38% or 1370 will be HGVs” (Port of Cork, 2013, p. 3).
The relocation induces a risk for an adverse impact of the port generated traffic on the National Road network interchanges. To avoid this, the Port of Cork Company suggests upgrading Dunkettle Interchange to free-flow. Such an initiative may help to remove one of the main of possible bottlenecks (Port of Cork, 2013). Moreover, the port plans to implement a mobility management plan meant to enforce policy measures to suppress HGV movement during peak times on the road network points where the traffic is overloaded (Port of Cork, 2013).
Collective Action
Since the Ringaskiddy port redevelopment project is supported by national policies, it is possible to presume that a public infrastructure required for the collective action of logistics operators is present in the region. A few policies that may help bring the facility expansion endeavours to success are the Smarter Travel policy and N28 Corridor Sustainable Travel Strategy, which aim to eliminate the risks for the development of bottlenecks after the port generated traffic will increase (Port of Cork, 2013).
To achieve this, the policies encourage the promotion of the modal shift from private to public transport in the area (Port of Cork, 2013). Since the traffic on the road network is highly car-dependent, such initiatives will provide additional capacity headroom for the port’s strategic economic activity and minimise the regionalisation risks.
Possible Challenges
Nowadays, as the traditional division of tasks within the logistics chain have become blurred due to commonly implemented vertical integration strategies (i.e., vendor managed inventory; efficient customer response; and collaborative planning, forecasting and replenishment), ports become involved in the competition at the supply chain level (Rodrigue and Notteboom, n.d.; Monios and Wilmsmeier, 2013). Thus, the port authorities must continuously engage in the enhancement of terminal and landside operations to ensure that savings gained at the seaside are not lost during the expansion at the landside.
As stated by Moreira (2013), rail transport is associated with greater cost efficiency compared to road transport, and it is expected that in the future the trend will increase. In the Ringaskiddy redevelopment plan, the focus is made on road distribution networks, which means that the port will probably not be able to provide competitive shipping prices. As a result, cargo owners may prefer other gateways.
Recommendations
The port authorities should aim to create core competencies through the development of port-related value-added logistics activities, efficient information systems, and greater inter-modality. To do so, it can be recommended for Port of Cork to form strategic alliances within the port sector itself. Partnerships can help the port authorities to secure the development efforts and investments.
The development of the deep-water facilities can help Port of Cargo accommodate larger port clients. However, it should not be expected that cargo owners will be simply attracted because the port is a natural gateway to hinterlands. According to Rodrigue and Notteboom (n.d.), “major port clients concentrate their service packages not on the ports’ sea-to-land interface but on the quality and reliability of the entire transport chain” (p. 26). Therefore, to ensure the profitability of the planned development project, the port management must focus on the enhancement of service reliability and flexibility, product varieties, as well as corporate governance transparency.
Conclusion
The level of ports’ control over hinterlands is the primary factor defining their competitiveness. The findings of the literature review and the analysis of two ports’ cases reveal that such factors as the interconnectedness of the port and hinterland territories through efficient logistics infrastructures, provision of multiple value-added logistics services, as well as the effective public infrastructure and national governance are of great importance for successful port regionalisation. If a port captures the greater number of favourable factors, it will be able to become more attractive for large cargo owners and expand its operations within its main hinterlands and also improve its performance at competition margins.
Reference List
Monios, J & Wilmsmeier, G 2013, ‘The role of intermodal transport in port regionalisation’, Transport Policy, vol. 30, pp. 161-172.
Rodrigue, JP & Notteboom, T 2012, ‘Dry ports in European and North American intermodal rail systems: two of a kind?’, Research in Transportation Business & Management, vol. 5, pp. 4-15.
Rodrigue, JP & Notteboom, T n.d., Challenges in the maritime-land interface: port hinterlands and regionalization. Web.
To a considerable extent, the level of organizational performance in international transport systems (ITS) is defined by the efficacy of the transport systems themselves (Bray, Caggiani, & Ottomanelli, 2015). The specified phenomenon is especially evident in the context of the global market, where the well-coordinated actions of the participants allow for the proper functioning of the supply chain and, therefore, the timely and successful delivery of the necessary raw materials, components, and products to the target destinations.
Improving international transport systems is a crucial step towards a gradual positive change in the state economy (e.g., the creation of premises for consistent economic growth). The use of an improved data management system that will allow for a rapid and more efficient transfer of essential information from one participant in the global supply chain management process to another will create the premise for developing an improved transportation system. The change will become possible by offering tools that are useful for addressing the emergent issues immediately, thus preventing a range of obstacles from blocking companies’ way to a successful transportation process.
Problem Definition
The emphasis on the significance of ITS development is obviously a welcome change of pace in the contemporary business and economic environment. Strategies that are currently used to manage ITS leave much to be desired, mainly because of the lack of opportunities for evaluating the efficacy of these systems. In turn, the tools that are currently used to measure the efficacy of international transport systems lack accuracy, which can lead to a significant drop in the quality of performance.
A closer look at the challenges that it has been experiencing will reveal that a significant number of these problems may result from the inappropriate use of the available data and the failure to utilize an efficient information management framework to prevent accidents and other issues from occurring (Jurjevic, Dundovic & Hess 2016).
It should be noted, however, that several approaches aiming at the improvement of the current ITS exist, with Data Envelopment Analysis (DEA) being key. The DEA framework creates an environment in which a detailed and all-embracing data analysis becomes a possibility: “DEA evaluates the efficiency of each DMU relative to an estimated production possibility frontier determined by all DMUs. The advantage of using DEA is that it does not require any assumption on the shape of the frontier surface, and it makes no assumptions concerning the internal operations of a DMU” (Bray et al., 2015, p. 187).
To enhance the data management process, DEA suggests incorporating the analysis of the fuzzy variables into the process (Mohideen, Devi, & Durga 2016). According to the existing interpretation of the subject matter, fuzzy numbers can be defined in the following way: “Any fuzzy subset where x takes its number on the real line R and ” (Xu & Zhou 2011, p. 14). Therefore, a comprehensive information management strategy based on the use of fuzzy numbers and variables would significantly improve the current situation.
The use of Intelligent Transport Systems (InTS), in turn, will allow for a notable improvement in safety levels (Janusova & Cicmancova 2016). By design, the tools help in identifying the transportation routes that will allow for the most efficient and fastest transfer to the destination point. Critical infrastructure protection strategies, which will be aimed at protecting InTS, will help prevent road accidents and will also help manage traffic congestion and similar issues that may occur during the transportation process (Janusova & Cicmancova 2016). The identified model should be viewed as an important tool for managing the needs associated with ITS improvement since it provides a comprehensive model that incorporates every possible factor affecting the transportation process (see Appendix A).
Research Objectives
Identifying the current tools for ITS efficacy measurement;
Determining the advantages and disadvantages thereof;
Suggesting a new and improved system of measuring ITS efficacy.
Research Significance and Contribution
The significance of the study can be defined as a medium in impact. While it is unlikely to reinvent the current system of global SCM processes, it may deliver results that will help create more efficient strategies for transporting goods and their components. Furthermore, the overall efficacy of the information management process may be improved significantly since, to improve the transportation process, it is necessary to considerably enhance the data management framework.
As a result, tools for improving measurement can be designed. Moreover, the foundation for a rapid positive change in the transportation domain will be built. As a result, the study will contribute to the enhancement of one of the essential business processes and, therefore, to economic growth rates (Grabara, Kolcun & Kot 2014).
Research Questions
What characteristics do contemporary ITS possess?
What are measurement tools for determining the efficacy of modern ITS currently used?
What are the advantages and disadvantages of the identified measurement frameworks?
How should the ultimate measurement tool for evaluating the performance of ITS in the context of the global economy look, based on current quality standards?
What implications for businesses do the results of the study have?
Research Methods
Seeing that both an overview of the existing methods of ITS assessment and a comparison of the models identified in the process will be required, it is reasonable to adopt a mixed study approach. The mixed design will allow obtaining qualitative data and quantifying it afterward so that a detailed assessment can be conducted.
The qualitative analysis will be conducted as phenomenology so that the nature of ITS can be explored. For this purpose, a thorough overview of the existing studies on the subject matter will be carried out. The quantitative study, in turn, will imply a statistical analysis, allowing for a comparison between the identified approaches to measuring ITS. In particular, ANOVA should be used to compare the assessment tools.
The outcomes of the study will be used to determine the best assessment framework. Afterward, the ultimate approach to evaluating the efficacy of ITS will be created, based on the combined strengths of the existing approaches to ITS assessment. It is expected that the newly designed method will allow addressing some of the limitations of the current frameworks, thus providing an opportunity for a more accurate evaluation of ITS.
Structure of the Project Report
The project report will include three main sections: the introduction, discussion, and conclusion with recommendations. The introduction will set the background for the analysis, outlining the key aspects of contemporary ITS as well as the general approaches to their management. The problem and its scope will be defined, and the research question, along with hypotheses, will be laid out. The introduction will be followed by the body of the paper, where the essential stages of the analysis will be described in detail.
Next, the interpretation of the results will be provided, including a detailed description of the implications that the strengths and weaknesses of the current measurement tools have for ITS and how the current frameworks can be improved. The final section of the report will offer a brief summary of the study, along with guidelines concerning the design of the ultimate measurement tool. Furthermore, it is expected that the suggested ITS measurement framework should be tested in follow-up studies so that it can be used in a manner that is as efficient as possible for the further promotion of the economic progress.
Time Plan for Minor and Major Activities and a Gantt Chart
It is expected that the study will be carried out within three months. The need to collect a vast amount of data and process it carefully is the primary reason for setting the specified deadline. Three major activities are planned to be carried out: collecting the needed information, analyzing it, and determining the ultimate tool for measuring ITS. As the chart below shows, the goals listed above will require meeting several minor objectives.
It should be noted, however, that minor obstacles may be faced on the way to retrieving the necessary data, analyzing it, and delivering the end results. Indeed, seeing that each assessment tool may incorporate different aspects of ITS functioning, designing a comprehensive strategy may be rather difficult. Nevertheless, a comparative analysis of the significance that the identified characteristics hold will help in determining their value. Furthermore, the process of collecting the needed data may require extra time due to the complexity of the subject matter. However, it may be assumed that by the end of the third month, the study will be completed.
Reference List
Bray, S, Caggiano, L, & Ottomanelli, M 2016, ‘Measuring transport systems efficiency under uncertainty by fuzzy sets theory-based Data Envelopment Analysis: theoretical and practical comparison with traditional DEA model,’ Transportation Research Procedia, vol. 5, pp. 186-200.
Grabara, J, Kolcun, M & Kot, S 2014, ‘The role of information systems in transport logistics,’ International Journal of Education and Research, vol. 2, no. 2, 1-8.
Janusova, L & Cicmancova, S 2016, ‘Improving the safety of transportation by using intelligent transport systems,’ Procedia Engineering, vol. 134, no. 1, pp. 14-22.
Jurjevic, M, Dundovic, C & Hess, S 2016, ‘A model for determining the competitiveness of the ports and traffic routes,’ Thenicki vjesnik, vol. 23, no. 5, pp. 1489-1496. Web.
Mohideen, SI, Devi, K & Durga, MD 2016, ‘Fuzzy transportation problem of fuzzy octagon numbers with –cut and ranking technique,’ Journal of Computer, vol. 1, no. 2, pp. 60-67.
Xu, J & Zhou, X 2011, Fuzzy-like multiple objective decision making, Springer Science & Business Media, New York, NY.
Not so long ago intermodal transportation attracted enormous attention with the development of supply chains that can be seen all over the world. Since the previous century, it has changed greatly due to the technological evolution. With the focus on centralization and deregulation that was observed at the end of 20th century, intermodal transportation started to be treated as a driver of growth (Rodrigue, Comtois, & Slack, 2012).
As the US and Europe applied regulation and deregulation, they affected various industries greatly as well as promoted economic growth. The desire to improve intermodal relationships triggered the implementation of deregulation. With its help, governments wanted to increase price and competition in the sphere so that the development of the intermodal transportation can be streamlined.
The first steps of such changes were seen in the 1940s already, with the appearance of the Transportation Act. Still, more substantial alterations were made in a decade starting with the 1970s, and included the US recognition of the Motor Carrier Act and the Staggers Rail Act of 1980. As a result, intermodalism started to grow and logistics improved. New multimodal transportation organizations appeared as it was cheaper to maintain inventories.
Those companies that used to be competitors started cooperating with the desire to market their capacity. A range of intermodal operating agreements was made, which provided an opportunity to expand a range of services and adapt them to various clients. As a result, the price of the services lowered while their quality reached higher levels (Engelke, 2016). Due to the cooperation between rail, trucking and shipping organizations, “intermodal traffic has grown from 3.1 million trailers and containers in 1980 to 8.8 million in 1998” (Bureau of Transportation Statistics, 2000, par. 9).
The US transportation system was in poor condition in the 1970s because there was not enough funding to buy new equipment and make it less dangerous. Still, with the implementation of the Regulatory Reform Act that was followed by the Staggers Act the situation started to improve, and “seven bankrupt rail lines” were replaced by Conrail (Bureau of Transportation Statistics, 2000, par. 7). The railroads received an opportunity to define and apply rates they believed to be appropriate.
Moreover, they got a chance to stop working at some lines if considered them to be unprofitable. Class I railroads started to grow rapidly so that today there are more than five of them only in the US. The fact that regulations provided rail lines with a possibility to stop working in particular locations turned out to have negative consequences for those people and organizations that represent them, as transferring became more complicated for them.
The deregulation of rail transport triggered the decline in trucking rates, which seemed to be a disadvantage for this industry but in fact provided an opportunity to implement efficient improvements and enhance operations. In addition to that, the logistics system which used to be extremely complex was improved and became simpler. Railroads and trucking organizations started to cooperate. They used a single container source, which leads to consolidation and simplified the procedure of product delivery.
However, the implementation of some regulations made it more complicated for the intermodal transportation to develop because the organizations had to follow strict instructions. For example, the Federal Law made it more difficult for the start-up firms to operate. According to it, they are to obtain “certificates of public convenience and necessity” (Justia, 2013). In this way, organizations tend to face difficulties on the initial stages of working.
In addition to that, a great obstacle can be seen in the existence of regulations and policies that differ from one state or country to another. It means that the companies need to conduct a sufficient research and implement a range of changes to adapt to the rules of a new location if they are willing to expand and reach new market populations. The same can be said about the cooperation between different companies, as their operations and the way they maintain business need to be aligned for the agreement to come into force and bring success to both organizations.
Thus, it can be concluded that regulation and deregulation lead to the improvements in the intermodal transportation. They enhanced the quality of the services, broadened their range, and urged the competition in pricing. All in all, the usage of intermodal transportation became much more frequent as the US and European governments accepted appropriate acts. Still, some regulations turned out to have an adverse impact on the intermodal transportation and its growth.
They lead to the necessity to obtain new certificates and follow the policies that differ in different states and countries. In addition to that, individuals and companies that are located in the territories abandoned by the rail lines tend to have difficulties with reaching their destinations even though such alteration allowed the rail lines to reduce their expenditures. Still, regulation and deregulation tend to have more positive influence on the transportation industry regardless of some drawbacks, as they gave it more opportunities for development and enhancement.
References
Bureau of Transportation Statistics. (2000). Growth, deregulation, and intermodalism. Web.
Engelke, L. (2016). Factors affecting freight demand. Web.
The construction of a railroad in California was a crucial step that was aimed at linking all parts of this state to a single transportation system. Such an infrastructural development would lead to its social, economic, and political advancement. For approximately two decades after being acknowledged as a state in the U.S., California remained greatly isolated until the completion of the First Transcontinental Railroad in 1869.
As the paper reveals, the construction of the railroad in California was meant to achieve the goal of improving its transport system, bringing distant towns and mainstreams closer, improving its economy, and ending the then traffic jam problem. Such infrastructural progress has had a substantial impact on the lives of Californians, including the creation of employment opportunities, the enhancement of transportation networks, the advancement of the state’s economic status, and the reduction of poverty and road traffic.
The Goal of Constructing Railroads
In 2008, California endorsed Proposition 1A that sought to steer the financing of a rail line to upgrade its prevailing transport standards. A variety of reasons led to the construction of this railroad. According to an article by Karner, the need for bringing distant towns and mainstream cities closer was one of the chief reasons that informed this infrastructural endeavor.1 Some regions were extremely far from others to the extent of being inaccessible.
Deverell’s book mentions areas in California such as deserts, plains, and rocky regions, which could not be reached before the railroad was constructed.2 As a result, it was difficult to unite places of the same state or to engage in the exchange of goods and services. Californians believed that constructing a railroad would make it easier for regions to not only remain linked but also involve themselves in activities that would promote wholeness and the economic development of the state.
As Wunderlin reveals, another reason that influenced the decision to construct the railroad was to improve the transport system in the state.3 Transport had become a huge problem to the extent that some places could not be reached. As a result, it took considerably more time and energy to access them, implying that those who relied on transport networks for their business were hugely affected. In a study by Borodako and Rudnicki, it is apparent that transport systems influence the status of trade in various regions.4
Before implementing the railroad project, the movement of people, goods, and services was a major challenge because it proved difficult to move across other states or countries for business purposes. In particular, the article by Wunderlin reveals that indeed the railroad “business plan was designed around food stuff, specifically farm produce and processed foods, because the produce was the last commodity that had very long lengths of haul.”5
Consequently, the situation was negatively affecting the state’s economy. With the introduction of the railroad, the exchange of commodities and services was expected to be easier. In addition, nothing would hinder people from traveling to other regions. The railroad project was meant to ensure that Californians would not take an unnecessarily long time before arriving at their respective destinations.
The need for economic development of the state of California was another reason for the railroad construction. Great distances between regions and poor transport systems had led to the lack of business interactions among people. As a result, California’s economy seemed to decline gradually.6 Many businesses in this state were performing poorly. In addition, production levels from agricultural activities were hugely affected because farmers feared that their goods would expire before they were purchased. Specifically, people who were supposed to buy them could not easily access various regions in California because of poor roads.
This worrying situation called for a decision to find a better transportation system, which could ensure that people not only traveled conveniently to other regions but also engaged in their respective business activities without interruptions. The construction of the railroad in California was founded on the need for an improved economy whereby citizens would purchase and sell their goods and services. Taxes collected from the anticipated booming trade would contribute to further developments in this state.
Finally, the need to do away with the increased traffic jam and/or reduce the rate at which accidents were happening also formed the basis of the construction of the railroad. People would experience snarl-ups that made them spend quite a long time on roads before arriving at their various business destinations. Perishable goods would not reach customers in good conditions. The rate of accidents had also increased following the lack of order regarding the way vehicles needed to move along Californian roads. The railroad was to be introduced to eliminate such devastating situations. In addition to addressing the issue of accidents, commodities would be supplied to various markets within or outside California in good conditions.
Impacts of the Railroad
The construction of the railroad in California brought about numerous impacts to the state. To begin with, it led to the direct creation of employment to jobless individuals. According to Karner, it led to “an improved interregional system capable of meeting post-war travel demand and employment needs”.7 Their involvement in this project helped to reduce poverty among several Californians who had previously lacked finances to satisfy their daily needs. Low levels of education had further contributed to widespread poor living conditions in the state. With the introduction of the railroad, Potter reveals that the employment created not only enhanced people’s livelihoods but also boosted its economy.8 To date, California is the wealthiest state in the U.S.
Another impact of the railroad construction plan to Californians was that it enhanced transportation. Previously, some regions could not be reached. However, the construction of the railroad paved the way for further developments that ended up boosting not only the value but also the global image of California. Today, California is the third most expensive and extensive state in the U.S., after Texas and Alaska.
According to Karner, the vastness of the state presented a major transport problem, particularly to suppliers of goods and services.9 However, with the introduction of the railroad, transport was made easier and faster because people could take only a few hours to travel from one region to another. Further, the railroad led to a smooth movement of people, thus solving the challenge of labor shortage in some parts. Additionally, it enhanced business operations, especially regarding farmers who were supplying perishable goods. Thus, the Californian economy benefited from the improved transport network.
The railroad led to the infrastructural and economic development of the state of California. According to Ngai, the ease of movement improved the mobility of a skilled workforce, as well as raw materials.10 Such an uninterrupted supply of labor helped to stimulate industries across various regions in California because of the increase in business production levels. Money supplied to local economies of the state also widened its financial system. According to Wunderlin, the fact that people began to travel easily to far regions to either purchase or sell particular goods and services also helped to boost the Californian economy and that of the entire U.S.11
Businesses in all regions remained active. Productivity and profitability levels were higher compared to the situation during the pre-railroad period. Other industries such as banks and learning institutions also developed along the railroad.
Another impact of this infrastructural endeavor is that it improved Californians’ living standards. Most poor citizens are usually found in local regions. According to Ngai, with the implementation of the railroad, people in these areas could secure themselves employment whose income helped to cater for their daily needs.12 Some of these jobs included working as drivers and railroad maintenance officers. These workers earned a living by transporting people, goods, and services from one region to another.
The income acquired helped to meet their needs for food, education, and health services. Moreover, this infrastructural project spurred economic growth in areas where it passed through. The construction of the railroad in California led to a reduction of snarl-ups mentioned earlier. In this regard, transport was easier and faster. It also helped to improve people’s safety since highways and tracks were now separated as a strategy for reducing accidents.
Conclusion
The construction of the railroad in California was a crucial endeavor that aimed to achieve various goals. Overall, this paper has revealed that it helped to improve California’s economy. The transport system was enhanced to the extent that people could now take a shorter time to travel to far regions within this expansive state. The construction project also created jobs for Californians. They could earn revenue that helped to reduce their poverty levels.
Consequently, they could access basic services such as education and healthcare. In addition, congestion in roads became a less pressing issue because tracks were separated from highways as a way of eliminating accidents. Further, the fact that goods from local regions in California were highly purchased because of increased income levels led to the booming of businesses and industries. The railroad also enhanced unity in the state because people interacted more in the course of traveling from their regions to others and vice-versa.
Bibliography
Borodako, Krzysztof, and Michał Rudnicki. “Transport Accessibility in Business Travel — a Case Study of Central and East European Cities.” International Journal of Tourism Research 16, no. 2 (2014): 137-145.
Deverell, William. Railroad Crossing: Californians and the Railroad, 1850-1910. Berkeley: University of California Press, 1994.
Karner, Alex. “Multimodal Dreamin’: California Transportation Planning, 1967-77.” Journal of Transport History 34, no. 1 (2013): 39-57.
Ngai, Mae. “Chinese Gold Miners and the “Chinese Question” in Nineteenth-Century California and Victoria.” Journal of American History 101, no. 4 (2015): 1082-1105.
Potter, Cuz. “River of Traffic: The Spatial Fragmentation of US Ports.” Regional Studies 49, no. 9 (2015): 1427-1440.
Wunderlin, Amy. “The Food and Beverage Industry Looks Toward Rail as American Roadways Continue to Deteriorate.” Food Logistics, no. 186 (2017): 30-33.
Footnotes
Alex Karner, “Multimodal Dreamin’: California Transportation Planning, 1967-77,” Journal of Transport History 34, no. 1 (2013): 39.
William Deverell, Railroad Crossing: Californians and the Railroad, 1850-1910 (Berkeley: University of California Press, 1994), 2.
Amy Wunderlin, “The Food and Beverage Industry Looks Toward Rail as American Roadways Continue to Deteriorate,” Food Logistics, no. 186 (2017): 30.
Krzysztof Borodako and Michał Rudnicki, “Transport Accessibility in Business Travel — a Case Study of Central and East European Cities,” International Journal of Tourism Research 16, no. 2 (2014): 137.
Wunderlin, “The Food and Beverage,” 30.
Ibid., 31.
Karner, “Multimodal Dreamin,” 42.
Cuz Potter, “River of Traffic: The Spatial Fragmentation of US Ports,” Regional Studies 49, no. 9 (2015): 1427.
Karner, “Multimodal Dreamin,” 42.
Mae Ngai, “Chinese Gold Miners and the “Chinese Question” in Nineteenth-Century California and Victoria,” Journal of American History 101, no. 4 (2015): 1087.
Implications of an Uncertain Future on Port Planning and Design
Introduction
Ports act as economic gateways of various countries. The reason behind this is because they play a key role in the development of both domestic and international trade. According to Bichou, the effective operation of ports is dependent on, among others, the mission statement of the planners (99). It is also noted that the operations of these facilities differ between regions. The differences result from the laws, approaches, and attitudes of specific nations.
In the recent past, analysts have shown interest in conducting studies on port development. The scope of research has become a dominant theme in the field of maritime economics. Harlaftis, Tenold, and Valdaliso note that the studies aim at understanding the uncertainties and evolution of the port industry (102). Besides, scholars want to gain more knowledge of the changing role of ports in logistics and supply chains.
In this section, the author will discuss a statement made by Taneja et al. regarding the uncertainties affecting port planning (222).
Uncertainties Affecting Port Planning and Design
In the journal ‘Implications of an Uncertain Future for Port Planning’, Taneja et al. make several observations regarding the future of the maritime industry (224). They note that the uncertainties under which docks operate make planning and designing of these socio-technical infrastructures difficult. Uncertainty refers to inadequate knowledge of past, current, or future events. According to Taneja et al., the port industry is characterized by an evolution of function, logistical, economic, and technological ambiguities (221). The statement by the scholars is true. The reason is that the factors mentioned are linked to globalization and liberalization. In the recent past, the business environment has experienced extensive changes.
Analyzing the Uncertainties Mentioned by Taneja et al. (221-245)
Evolution of the Functions of the Port
Over the past few decades, the maritime industry has experienced extensive transformation. Since the introduction of commercial containers, shipping has become a faster and cheaper way of transporting merchandise from one continent to the other (Pineiro 89). Due to these changes, the functions carried out by ports have evolved. Initially, the role of these facilities was to handle, distribute, and stack merchandise. Today, ports have become multipurpose logistic chains.
Transportation of goods in harbors flows from one form to another. In the end, all the flows integrate and then disband. The evolution of functions has become an uncertainty under which the docks must operate. If proper measures are not put in place, the ambiguity makes planning and designing of maritime activities a challenging task. To minimize the complexities, port planning needs to concentrate on flows. Besides, the industry should ensure effective and cheap transportation of goods. Borger and Bruyne note that there will be an extensive growth in containerized traffic shortly (248). Consequently, port managers must ensure that the infrastructure matches the traffic growth.
Technological Uncertainties
Taneja et al. consider technology to be one of the ambiguities that make planning and designing of ports a challenge. Today, most nations are working hard to introduce new technology into their dock industry. The advancement leads to changes in the shape and texture of the old container terminals. According to Shen, the rapid developments in construction materials and technology impact significantly on planning (65).
The maritime industry has to shift and use emerging technologies to deal with such issues as security, operational effectiveness, and environmental conditions. Also, ports have to focus on acquiring bigger ships, up-to-date cargo handling techniques, efficient data collection and processing frameworks, and new equipment configurations. Harlaftis, Tenold, and Valdaliso support the arguments made by Taneja et al. by stating that contemporary ports must adopt advancements in ICT and use efficient data collection procedures (247). All these changes are aimed at boosting terminal operations. However, the new technological innovations place new demands on port infrastructures.
Logistical Ambiguities
Taneja et al. consider this element to be an issue that affects planning and designing in the maritime industry (228). Logistics refers to a time-sensitive procedure of the flow of merchandise from one point to another (Taneja et al. 233). According to this definition, logistical ambiguity can be described as the various factors affecting the transportation of goods. It is a fact that the shipping industry suffers from these uncertainties.
The problem is caused by such issues as delays, demand and inventory, poor coordination, and delivery constraints. Logistics is an evolving phenomenon (Shen 25). The development is caused by such aspects as globalization, changes in shipping costs, and the desire to venture into new markets. With the innovations in the maritime industry, clients expect reliable, flexible, and precise services. Besides, they need their goods to be delivered at the utmost speed and affordable costs. All the factors associated with logistical uncertainties impact the planning and designing of technical infrastructure in the ports.
Economic Uncertainties
The constant shifts in the global economy lead to ambiguities in the maritime industry. The primary role of ports is to facilitate international trade. Trade is affected negatively by global recessions. The impacts extend to the shipping industry. Pineiro notes that approximately 90% of the world’s trade is supported by the maritime industry (114). The statistics reveal that shipping is the most common means of ferrying goods. Economic uncertainties cannot be avoided. During severe global recessions, companies tend to lay off container ships and workers. According to Taneja et al., such crises make it a challenge for ports to design and plan socio-technical infrastructures (240).
Conclusion
The maritime industry is the primary driver of international trade in the world. Despite the various economic gains associated with the industry, the sector is affected by various uncertainties. According to Bichou, the ambiguities impact the planning and designing of port infrastructure (97). Coordination of activities is affected negatively when planning is interfered with.
Port Performance Indicators
The Use of Port Performance Indicators
Performance measurement in ports helps in the management of internal and external pressures. The evaluation is done by collecting data, monitoring, and benchmarking activities (Borger and Bruyne 250). The procedure has various benefits for organizations in the port sector. For example, the information acquired can be used to enhance operations. Besides, the process can provide dock managers with a basis for planning future developments.
Port performance indicators are measures of different aspects of facilities and operations in the harbor. To enhance the effective evaluation of the performance of ports and terminals, the selected indicators should be easy to use and compute. The pointers should also provide insight into port management (Harlaftis, Tenold, and Valdaliso113). Different sets of indicators can be used in various ways. One mode is to compare performance with a goal. The second involves monitoring the recital trend.
Various performance indicators can be used to examine the efficiency of ports and terminals. According to Pineiro, each cargo at the dock should have its unique set of pointers (85). The reason is that ships transport different categories of goods. The most common port performance indicators include those associated with the financial, operational, and logistical aspects of the facility.
Financial Indicators
The pointers are used by dock managers to determine the cost of running operations. Labor and capital equipment are some of the elements that incur high expenditure. Financial indicators are also used to evaluate the total revenues generated from the shipping activities. All the fiscal information is acquired from the accounting systems. According to Bichou, financial indicators are used to identify the areas that need more allocation of resources (117).
Operational Indicators
The pointers are used to ensure that all activities run as expected. If port operations are not going according to plan, many areas will be affected. One of the elements impacted by an operational failure in the financial sector. The indicator comprises four efficiency parameters (Taneja et al. 237). They include:
Output per ship berth-day
The constraint is used to determine the average output of each carrier at a berth per day. The output is measured in tons.
Idle time at berth
The indicator is used to measure the time a ship stays inactive at the dock. Minimal idle time is an indication that cargo handling is done on time. As such, more carriers can be prepared to ferry goods.
Pre-berth detention
The parameter measures the time vessels wait before they are allowed to access a berth.
Turn-round time
The indicator defines the time spent by ships in the dock. It is the duration spanning from entry to departure (Harlaftis, Tenold, and Valdaliso 101).
Logistics Performance Indicators
They are used to measure throughput, maritime, and intermodal connectivity (Borger and Bruyne 260). They are also used to evaluate vessels’ call size and quality of procedures carried out by customs officials.
Linear Programming for Data Envelopment Analysis (DEA)
Data Envelopment Analysis (DEA) is a non-parametric linear programming technique. It is used to evaluate the efficiency of decision-making units (DMUs) in the transport industry.
Calculation
In the table provided, there are 7 DMUs to be evaluated. They are represented by n. Each consumes m inputs and produces s outputs.
From the statement, it is assumed that DMU1 consumes X1j of output A and produces Y1j of output A.
It is also assumed that X1j ≥0, Y1j ≥ 0, and for each DMU there is at least one positive input and output. From these assumptions, the ratio of outputs used to measure the relative efficiency = DMUA = DMU0, the DMU to be evaluated relative to the ratio of all the j = n DMUjs
The function to be maximized is:
Max h0 =
s.t = for j=1,….n
max h0 =
s.t = for j=7
xij is the amount of inputs i used to obtain Yrj.
The amount of output r produced by DMU j, vi, and ur represents the weight allocated to input i and output r.
To solve the mathematical problem, the equation is transformed into a linear programming model.
Max =
Ur, vi ≥ 0
38, 16 ≥ 0
The solution to equation 2 is as follows (min ᶱ)
λj≥0 j=1….n
The above equation is a CCR model that portrays the use of an input-oriented approach. The output orientation is depicted as follows:
Max ᴓ
λj≥0 j=1….n
.
ᴓ is the value of the relative efficiency score for each DMU.
To come up with a final solution, the DEA model integrates another constraint:
.
.
Issues Affecting the Chinese Bulk Port Sector
Introduction
Port developments take place all over the world. The level of growth is determined by a nation’s need to import and export goods. It is also influenced by the desire to acquire and benefit from the growing seaborne trade. Currently, China is the largest shipbuilder in the world (Pineiro 110). Over the past five years, the nation has also reported the highest container-port throughput in the globe. China’s ports facilitate the transportation of such goods as coal and iron ore between the mainland and islands. To keep up with the increasing competition in the shipping industry, China is upgrading its container transport system.
In this section, the author will analyze the issues facing the Chinese bulk port sector’s development. Besides, the implications of these phenomena on the government and policymakers will be addressed.
Issues Facing the Chinese Bulk Port Sector
The Chinese bulk port industry has experienced extensive growth in the recent past. By the end of 2004, the nation’s ports had approximately 2,500 berths (Borger and Bruyne 265). The berths had a combined capability of handling 61.5 million containers. Consequently, China is ranked first in the world in terms of the capacity to handle containers. In 2009, the country’s container throughput registered a 6% decline. Despite the drop, China’s throughput accounts for 25% of the global container share (Shen 36).
China continues to dominate the shipping industry. Currently, the country controls the largest share of imports and exports in dry and bulky goods (Pineiro 96). However, various factors affect the bulk port sector. One of the problems is the competition. Chinese carriers faced stiff rivalry from the Brazilian Valemax. Vales are the largest bulk carriers in the world (Harlaftis, Tenold, and Valdaliso 113).
Their capacity ranges from 380,000 to 400,000 tons. They are also the longest ships in the world. The vessels were intended to transport iron ore from Brazil to Asian and European ports. Since the launch of Vale operations, Brazil has failed to get clearance to dock in Chinese ports. Due to their large size, the carriers would transport iron at lower prices. To limit the competition, China’s transport ministry banned Vales in 2012. The authorities claimed that the interdiction was based on technical reasons (Shen 40). However, the ban has been lifted.
According to Taneja et al., the growth of Chinese iron ore and coastal sectors is facing a downturn (241). The reason is due to stiff competition from neighboring ports. The Port of Rizhao, for example, poses threat to Qingdao. Each dock wants to lead in the iron ore throughput. The rivalry has affected the capability of most ports in north and northeast China to handle bulky goods. Also, all the harbors in the country are competing amongst themselves.
Each dock desires to be the ‘pivot haven’ of the industry (Shen 24). Some ports have even violated bans put in place by the state with regards to the acquisition of new ships. One such harbor is Lianyungang. Over the past two years, the haven has obtained two carriers. On its part, Taipingwan went ahead and carried out construction projects without the approval of the Beijing authorities. The reason behind these moves is to stay ahead of rivals.
Another issue affecting the Chinese bulk sector is overcapacity. The issue is a major source of concern due to the nation’s slowing economic growth and ongoing capacity additions. Overcapacity is not limited to China’s economic landscape (Pineiro 110). It also affects the global economy. The reason is that congestion leads to increased tension in the trade sector. Some of the harbors suffering from severe overcapacity include Xiamen, Dalian, and Yingkou. Major developments have been taking place in Dalian. Once the project is complete, the port will have the capacity to handle over 300 million tons of goods. Expansion plans lead to increased competition (Bichou 105). On its part, such rivalry results in overcapacity of resources.
Another issue affecting the Chinese bulk port sector is the demand for efficient, comprehensive, and high-quality services. To meet the demands, Chinese ports will have to invest more in infrastructure. With the slowing economic growth and downturn in steel production, the nation is at risk of acquiring expensive but empty terminals (Pineiro 95).
Implications on the Chinese Government and Policymakers
The issues affecting the Chinese bulk port sector have various implications for the government and policymakers. The key players in the maritime industry have to come up with ways to tackle the existing issues. After lifting the ban on Brazil’s Vales, the port industry had to devise ways of keeping up with the competition. Policymakers in the ministry of transport permitted Dalian, Tangshan, and Ningbo-Zhoushan Qingdao to build bigger berths capable of handling the vessels (Harlaftis, Tenold, and Valdaliso 108).
In efforts to improve the port industry, the government and policymakers will have to approve the construction of more terminals. The move will facilitate the handling of more goods. As such, pressure from customers will be reduced. Also, the transportation of more commodities will lead to a rise in the growth of GDP (Pineiro 83). The stakeholders will have to devise ways to deter ports from violating the restrictions put in place. Several ports have carried out expansions without authorization. Such moves disadvantage other players in the sector (Bichou 109). Finally, the government and policymakers need to put in place measures to curb excessive competition and overcapacity in the maritime sector.
Works Cited
Bichou, Khalid. Port Operations, Planning, and Logistics, London: Informa Law from Routledge, 2009. Print.
Borger, Bruno, and Denis Bruyne. “Port Activities, Hinterland Congestion, and Optimal Government Policies: The Role of Vertical Integration in Logistic Operations.” Journal of Transport Economics and Policy 45.2 (2011): 247-275. Print.
Harlaftis, Gelina, Stig Tenold, and Jesus Valdaliso. The World’s Key Industry: History and Economics of International Shipping, Basingstoke: Palgrave Macmillan, 2012. Print.
Pineiro, Laura. International Maritime Labor Law, Berlin: Springer-Verlag Berlin Heidelberg, 2015. Print.
Shen, Cichen. Port Selection Reveals Beijing’s Concerns about Terminal Overcapacity. 2015. Web.
Taneja, Poonam, William Walker, Han Ligteringen, Maurits Schuylenburg and Robert Plas. “Implications of an Uncertain Future for Port Planning.” Maritime Policy & Management 37.3 (2010): 221-245. Print.
Strategically located between the Atlantic and the Pacific Oceans, the Panama Canal offers a cheaper, efficient, and safer route for maritime transport across the Atlantic and Pacific oceans. Panama Canal poses significant advantages to international maritime transport, especially between North American and South American countries. Before its development, sea merchants from North America’s East Coast used to travel around South America to reach America’s west coast. They equally had to sail through dangerous waters to reach their destination. Such risks meant that international maritime transport was expensive and time-consuming. However, with the development of the Panama Canal in 1914, the length of time needed to sail across the Atlantic and Pacific oceans reduced by half (Haskin 2012). Similarly, the risks posed by sailing through dangerous transport routes disappeared.
Now, the Panama Canal is a key transport route for international traders who operate between South America and North America. Several types of cargo pass through the Panama Canal yearly. Most of this cargo includes foodstuff, fuel, and building materials (among other products). Across both ends of the Panama Canal transit route, 2009 estimates showed traders shipping 116,283 tons of cargo from destinations along the Atlantic Ocean to other destinations along the Pacific Ocean (Knudson 2012, p. 3). Conversely, traders transported about 81,713 tons of cargo from destinations along the Pacific Ocean to destinations along the Atlantic Ocean (Knudson 2012, p. 3). The use of the Panama Canal as a key transport route in international maritime travel cannot be underestimated because the Panama Canal Authority claims that sea traffic through the canal accounts for about 5% of all international maritime travels (Currie 2012, p. 400).
Ownership of the Panama Canal rotated among the French, United States, and the Panama government. However, since the Panama government gained control of the Island in 1999, the government has used the canal as a major revenue source. Panama’s president once said that he intended to use revenue from the canal to transition his country to a first-world country (DIANE 2012). Analysts estimate operations from the Panama Canal generates more than $650 million annually (Gros 2004, p. 322). The Panama government charges every ship about $35,000. Observers say that this figure may even double or quadruple in the future as the volume of international trade increases (Gros 2004). Since the Panama government secures all the revenues collected from the Panama Canal, the canal is a key revenue generation source as well.
Impact of Canal Expansion on the Size of Vessels Using the Canal
The Panama Canal Authority estimates that the expansion of the Panama Canal will bring a new set of locks to increase the facility’s operation capacity by almost double. In detail, the expansion of the canal allows for the passage of more and bigger ships. The largest ship to pass through the canal was about 973 feet (Hoffman 2009). The initial design of the Panama Canal hosted large ships such as the Panamax), but modern technology has seen the construction of newer and bigger ships that carry more cargo. Unfortunately, because of the outdated design of the Panama Canal, these modern ships cannot pass through the canal. Therefore, critics say Panama Canal’s initial design is outdated because today’s design of ships is not the same as they were in the early 1900s (Hoffman 2009). Big shipping companies (operating big ships) have also complained that they have to wait for several hours at the canal because they have to offload some of their cargo to smaller ships to pass through the canal.
Traders who have lost faith in the canal have incurred extra costs of seeking the services of round-the-world services to circumnavigate the challenges experienced at the Panama Canal (DIANE 2012, p. 19). This extra service has increased the cost of shipment for companies operating large ships. Moreover, customers have to compensate such companies for their trouble. Coupled with the delays experienced at the Panama Canal, using alternative routes to avoid Panama Canal has drastically increased the cost of freight around maritime routes bordering South America and North America. Therefore, modern ship designs have made it more difficult for the Panama Canal to operate efficiently. From this trend, there are increased fears that the Panama Canal may become obsolete. However, since the canal is a key revenue-generating facility for Panama, the Panama government and its citizens decided to modernize the canals to accommodate larger vessels, and cope with its increased traffic of ships. This conviction by the Panama government materialized through a referendum, where more than 70% of Panama citizens voted for the modernization of the canal (DIANE 2012). Moreover, the presence of competition from other countries (intending to invest in the construction of alternative sea routes) intensified the reasons for the Panama government to improve the canal’s efficiency.
Part of the canal’s expansion includes the construction of two more lock complexes at the entry and exit of the canal. The locks normally determine the size of the ship that can pass through the canal. Initial design features of the canal had a restrictive size on the type of ships that could pass through the canal. Considering the infrastructural setups of the canal, expanding the old lock size to meet the new specifications would be a tedious and expensive undertaking. Therefore, contractors had to design the new locks on a different canal. Its implication is therefore going to be the accommodation of large ships (Fleming 2000).
Besides the passage of larger ships, the expansion of the Panama Canal will also decrease vessel congestion. Indeed, the aging infrastructure of the Panama Canal has created congestion problems because it has been difficult for the canal to cope with the ever-increasing vessel traffic (DIANE 2012, p. 19). Therefore, many ships have experienced substantial delays from vessel congestion. Alternatively, some merchants have decided to load their ships with more goods and chosen an alternative route (to the Panama Canal) to avoid the massive delays witnessed at the canal.
A typical Panama ship has a deadweight tonnage, which stretches to a maximum of 80,000 tonnes (Fleming 2000). However, the maximum weight allowed for its cargo is 52,500 tonnes. The initial locks of the Panama Canal were 28.5 meters wide, but on the request of the U.S Navy to allow larger vessels to pass through the canal; contractors increased the length of the locks to 36 meters (DIANE 2012). This expansion happened to accommodate large U.S Naval ships. The size of every lock and the height of its canal normally determine the size of the ship that can pass through the canal.
The planned expansion of each lock introduces deeper and wider channels for ships to pass through. Ships that will use the expanded channels will be 25% longer, 51% larger in the beam, and 26% bigger in the draft, to define a new set of the matrix that will increase Panama’s capacity to accommodate modern vessels (Fleming 2000).
Through the above expansion, vessels will enjoy more time efficiency. The increased time efficiency stems from the additional features that the new water channel will have. For example, the newly constructed channel involves the use of tugboats (instead of locomotives) to position the ships along the canal (Fleming 2000). The use of locomotives has been the traditional method used to position vessels. Indeed, compared to tugboats, locomotives are less precise in positioning ships along their canals. Vessels will therefore take less time to pass through the canals because there will be a more efficient technology for aiding this journey. Besides the use of tugboats, vessels will also experience more efficiency, while passing through the new canals since rolling gates will act as additional facilities for the new locks (traditionally, contractors used miter gates. Compared to rolling gates, miter gates are less efficient and more time-consuming for easing the movement of ships through the canals).
Impact of Rising Oil Prices and Use of Low-Sulphur Diesel
The effects of surging global oil prices have not only affected the maritime industry because other transport industries that rely on fossil fuel have felt the impact of the rise in global oil prices as well (Dimitrova 2010). Based on environmental fears, the International Maritime Organisation and the European Union introduced new stringent measures regarding the use of fossil fuel in maritime transport. They have stated that the maritime transport industry should use low-sulfur diesel because of its good environmental record. The use of low-sulfur diesel increases the cost of oil because it is expensive.
The surging prices of oil and the use of low-sulfur diesel both imply that the cost of oil continues to rise. The maritime industry greatly depends on oil to power vessels. Within the last five years, the transport maritime industry has witnessed a significant rise of between five to eight times its energy costs (Transportation Economics & Management Systems 2008). The last decade has seen the price of crude oil rise from about $20 to about $140 a barrel. In the year 2000, experts projected that fuel costs only accounted for about 20% of the total operational costs in the transport sector (Transportation Economics & Management Systems 2008). However, when the fuel cost increased to about $140 a barrel, this cost accounted for about 50% of the total operational costs of the maritime industry. Since 2002, the cost of oil has almost doubled. Considering the rapid increase in the cost of oil prices, experts fear that the price of crude oil may rise to about $200 a barrel (Transportation Economics & Management Systems 2008). Such an increase would mean the price of oil would account for 70% of the total energy costs in the maritime industry because it would mean a 300% increase in the cost of oil (since 2002). Concisely, if the price of crude oil rises by only one dollar, there will be a 1% rise in the cost of transport (Transportation Economics & Management Systems 2008).
This rapid rise in the price of crude oil has caused a lot of instability in the maritime sector because experts say it may lead to some significant changes in the pattern of distribution for goods and services around the world (Bouchentouf 2011). For example, the maritime sector is responsible for the distribution of food and consumer products around the world. With the rapid increase in the price of oil, the price of food and consumer goods (such as electronics and furniture) will suffer significant hikes. Other consumer goods like cars and construction materials will also suffer the same fate because they are still subject to the movements in global oil prices (and its subsequent impact on the maritime sector). From the rapid increases in oil prices and the subsequent rise in the cost of goods and services, experts fear that the world economy may experience significant setbacks in its growth prospects (Transportation Economics & Management Systems 2008). Similarly, consumers and suppliers may have to contend with a shift in the equilibrium of the world economy.
The shift in supplier prices (to pay for extra maritime costs experienced from the rise in oil prices) may characterize the shift in economic equilibrium (Bouchentouf 2011). On the other end of the supply chain, consumers may have to adjust their demand for such goods and services to meet their purchasing power. A perfect example of this realignment (of demand and supply) manifests from the reduced demand for Chinese steel products to the U.S. Since the price of oil started to rise in the year 2000, Chinese steel production has decreased by 20%. However, the U.S steel industry is flourishing because the country’s steel production increased by almost 10% (Transportation Economics & Management Systems 2008). This difference in steel production occurs because Chinese steel manufacturers face extra production costs associated with shipping their products to the U.S, thereby making their products uncompetitive in the U.S market. Therefore, considering there is no change in the increase in oil prices, the cost of doing business in the maritime sector will equally increase. This increase stems from the increase in the cost of production that transporters experience from the rise of oil prices.
Focusing on the use of low-sulfur diesel to power ships, the long-term impact of such a strategy hinges on a better environmental record for the maritime industry. The use of low-sulfur diesel means that the industry will use cleaner fuel (Spyrou 2010). Low-sulphur diesel is clean fuel because its refinement means it has less sulfur content. Sulfur occurs as a natural part of diesel, and it is the cause of the dark smoke normally witnessed from diesel engines. Moreover, the high sulfur content in diesel engines also stems from the high level of soot in diesel. Soot causes dark fumes from diesel engines, thereby leading to serious environmental pollution (Spyrou 2010). Its refinement, therefore, means that it is 97% cleaner than conventional diesel available in the gas market (Spyrou 2010). The new direction by the International Maritime Organisation and the European Union will therefore ensure that there is improved air quality from maritime transport in the long-term (through decreased exhaust emissions).
Alternative Options
In most transport industries, decreased reliance on oil counteracts increased oil prices. The use of alternative sources of energy such as solar and electricity (among other green energy sources) has taken center-stage in curbing increased oil prices. However, it is difficult for the shipping industry to follow the same approach. Indeed, unlike other transport modes such as cars and railways, it is not easy to undertake extensive modifications to adopt alternative sources of energy such as solar, electricity, or biogas fuels to power ships (Transportation Economics & Management Systems 2008). Comparatively, the automobile sector is transforming its product development strategy to develop engines that can use alternative sources of energy such as electricity. The same approach cannot work in the shipping industry because ships carry very huge loads and sail through the wild, without any center for refueling or recharging (as cars). Therefore, the shipping industry is unique in its operations. Alternative strategies for mitigating fuel cost increase therefore need to come from its internal operations. In other words, all the alternative ways for counteracting increased oil costs need to stem from reorganizing the current operational activities of the shipping industry to increase efficiency.
The greatest selling point for water transport has been its low cost. Low-cost transport has been a defining feature of water transport (Transportation Economics & Management Systems 2008). It differentiates it from other modes of transport including road, rail, and air transport. Traditionally, water transport has provided the lowest cost of international transport because of their low line-haul price. So far, this paper shows that the relentless increase in the price of oil threatens the dominance of water transport in international trade. Even though the cost of oil and its subsequent effect on water transport (and other forms of bulk transport) is vital for the sustainability of the maritime industry, its importance is also subject to other price causes. Nonetheless, price is far less important in the movement of container transport because other price variables (like the time for transporting goods across international waters) also influence the competitiveness of the industry.
Since maritime transport is a form of bulk transport, shipping companies usually charge per ton. Even as the global prices of oil continue to increase, shipping companies can devise newer ways of reducing their shipping costs by using larger ships to accommodate more goods. This way, shipping companies will be able to exploit economies of scale associated with using larger vessels. Conversely, they will be able to charge lower shipping costs so that they do not lose their core advantage in international transport – low pricing.
Besides, since time is another crucial advantage for determining shipping costs, shipping companies can equally exploit the opportunities associated with transporting goods (in less time) to charge higher prices that counter the increased pressure of rising oil prices (on their operational costs). Usually, shorter shipping times attract higher shipping costs, while longer shipping times attract lower shipping costs. Shipping companies may exploit the opportunities existing from using faster vessels to charge a premium for their services. Shipping companies may use this costing model to mitigate the effects of rising oil prices on the shipping industry. Therefore, as the company experiences a rising wage bill (from increased oil prices), it may recover some of this lost revenue through improved efficiency. Therefore, shipping companies do not have to transfer increased operational costs to their customers through increased shipping costs. The above alternative methods for maintaining shipping costs ensure that shipping costs remain low. Through such pricing alternatives, shipping will remain a cheaper mode of transport, thereby retaining its attractiveness as the main mode of transport in international trade.
References
Bouchentouf, A 2011, High-Powered Investing All-In-One For Dummies, John Wiley & Sons, London.
Currie, J 2012, Canadian Yearbook of International Law, UBC Press, Ontario.
DIANE 2012, The Panama Canal in transition, DIANE Publishing, New York.
Dimitrova, D 2010, Seafarers’ Rights in the Globalized Maritime Industry, Kluwer Law International, London.
Fleming, G 2000, The Millennium Link: The Rehabilitation of the Forth & Clyde and Union Canals : Proceedings of the International Conference Organized by the Institution of Civil Engineers and Held in Edinburgh, UK, on 30 June-1 July 2000, Institution of Civil Engineers (Great Britain), Thomas Telford, London.
Gros, D 2004, Economic Transition in Central and Eastern Europe: Planting the Seeds, Cambridge University Press, Cambridge.
Haskin, F 2012, The Panama Canal, Forgotten Books, New York.
Hoffman, J 2009, The Panama Canal: An Army’s Enterprise, Government Printing Office, Washington.
Knudson, J 2012, What Is the Purpose of the Panama Canal, Web.
Spyrou, A 2010, Global Climate Change and the Shipping Industry, iUniverse, New York.
Transportation Economics & Management Systems 2008, Impact Of High Oil Prices On Freight Transportation: Modal Shift Potential, In Five Corridors, Web.
Mohammed Obaid Al Mulla, the CEO of the Roads Transport Authority, is one of those key persons who promoted the idea of a helicopter taxi to be realized in Dubai and prove its status of one of the smartest cities in the world. The concept of flying taxis is actively developed by the RTA, and it is also supported by the government. Only a few years are required in order to make self-driving flying taxis a reality for Dubai.
A helicopter taxi is only one project among a range of initiatives and projects developed and realized by the RTA, and it is important to focus on Mohammed Obaid Al Mulla’s contribution to the progress of the transportation system of Dubai in the context of its development as a territory for innovation and technological growth.
Mohammed Obaid Al Mulla said that his role in the RTA is in “helping the government and the state to move toward smart services and electronic services to transform Dubai into the smartest city in the world.” Thus, the role of the RTA “is to address the needs of people, such as residents, tourists and visitors in Dubai, providing them with a network of roads and transportation systems.”
As a result of Mohammed Obaid Al Mulla’s activities, most road networks in Dubai are expanded, and the work of metro and bus transport is improved. Furthermore, all enhancements are based on the use of electronic applications and advanced tools. These improvements are in line with the global development of technologies.
Mohammed Obaid Al Mulla does not intend to stop improving the transportation system of Dubai, and “future plans of the RTA are to build many roads, tunnels and bridges, provide many radical solutions to traffic congestion, and connect all areas in a smooth, easy and safe manner.”
Modern business world is characterized by the focus on corporate responsibility, transparency, and collaboration. Halifax Transit is one of the organizations that adhere to the principles mentioned above and strives for being a corporate citizen contributing to the development of the community. The company provides high-quality services and attempts to innovate and employ the most recent technology to address the current environmental and social issues (Butler, 2019).
Such projects are likely to bring positive changes to the community and advance the transportation system of Halifax. However, the organization needs a more comprehensive approach to informing the community about its incentives. This paper includes a brief description of a campaign aimed at informing the community about the measures undertaken by Halifax Transit to make the city a better place to live.
Current Communication Channels and Existing Gaps
It is noteworthy that the company has rather a conventional view of sharing information with the community. Halifax Transit utilizes press releases often located at governmental websites (“Moving forward together,” 2016). The information about certain changes appears in local newspapers, which is one of the most common channels the organization employs (“Next round of Halifax Transit service changes,” 2019). The company uses social media quite extensively as well.
One of the major goals of a new informational campaign is transparency and collaboration. Halifax Transit tends to resort to conventional channels such as print media, social media, and television. However, these communication means can be used in a more efficient way. For instance, the gaps in the communication between the organization and its customers exist since many people are dissatisfied with routes or associated changes (Campbell, 2019; Maclean, 2019).
Nevertheless, the company seems to be ignorant of people’s concerns and disinterested in hearing them. Transparency and collaboration can be achieved through the involvement of more stakeholders and more communication channels. It is possible to use community philosophy as the primary approach to informing communities effectively (Tiffany, 2020). The implementation of research, transformational practice use, and the involvement of various stakeholders are key components of this method.
A New Campaign To Inform People
The new campaign would entail conventional and newer methods and engagement techniques. For instance, print media and television will still play an important part in informing people as they reach a wide audience during a comparatively short period of time. However, digital channels will be one of the two pillars of the new campaign. The use of social media and crowdsourcing can be instrumental in engaging communities and developing an appropriate relationship between a company and the public (Hawken et al., 2019). People will share their opinions, attitudes, and concerns, which will help Halifax Transit to identify the aspects to address.
Campaign Measurement Techniques
Another pillar of the suggested campaign will be face-to-face meetings that will take a form of community discussions, forums, workshops, focus groups, and conferences. Fredericks, Caldwell, Foth, and Tomitsch (2019) emphasize that these techniques can ensure people’s engagement and their willingness to collaborate, which can be important for the organizations providing such vital services as transportation. Community conversations can be at the core of the campaign as this communication channel ensures close contacts between the organization and key stakeholders (Carter & Bumble, 2018).
Regarding the measurement techniques to be employed to evaluate the effectiveness of the campaign, it is possible to analyze social media and implement more comprehensive research. A survey may concentrate on people’s satisfaction with the current services and the communication strategy chosen by the organization (Kapucu, 2016). These tools can help in measuring people’s awareness of organizations’ activities and their overall satisfaction with the provided services.
Conclusion
In conclusion, it is necessary to note that Halifax Transit should use a new communication strategy to inform the community about its innovations and its attempts to contribute to the sustainable development of the city. The new campaign may involve print media and television, but the primary communication channels will be social media and face-to-face meetings. The organization will facilitate the development of its image as a corporate citizen.
Carter, E. W., & Bumble, J. L. (2018). The promise and possibilities of community conversations: Expanding opportunities for people with disabilities. Journal of Disability Policy Studies, 28(4), 195-202. Web.
Fredericks, J., Caldwell, G. A., Foth, M., & Tomitsch, M. (2019). The city as perpetual beta: Fostering systemic urban acupuncture. In M. de Lange & M. de Waal (Eds.), The hackable city: Digital media and collaborative city-making in the network society (pp. 67-94). Amsterdam, The Netherlands: Springer.
Hawken, S., Leao, S. Z., Gudes, O., Izadpanahi, P., Viswanath, K., & Pettit, C. (2019). Safer cities for women: Global and local innovations with open data and civic technology. In S. Hawken, H. Han, & C. Pettit (Eds.), Open cities | open data: Collaborative cities in the information era (pp. 85-106). Singapore, Singapore: Springer Nature.
Kapucu, N. (2016). Community-based research in generating usable knowledge for public policy and administration. Administration & Society, 48(6), 683-710. Web.
Tiffany, G. (2020). Community philosophy and social action. In A. Fulford, G. Lockrobin, & R. Smith (Eds.), Philosophy and community: Theories, practices and possibilities (pp. 69-90). New York, NY: Bloomsbury Publishing.