Freight transport in 2010 : An exploration of future prices and quality of freight transport in three scenarios

Abstract

Background Central to this report is the question what effects government policy can have on rates, transit times, and the reliability of freight transport. In this context, two policy scenarios were examined: one scenario where all social costs that are currently ‘external’, are passed on to freight transport, and one scenario where the freight transport will grow substantially enough as to cause a significant increase in congestion. Six modes of transport were examined, namely road haulage, inland navigation, rail transport, airfreight, deep sea shipping, and short sea shipping. Data is collected using a Delphi survey in which 68 experts participated. Autonomous expectations Firstly we examined how rates, transit times and reliabilities will develop autonomously between 2001 and 2010. Regarding rates, an increase is expected for all modes. As the figures show, this means a discontinuity in the historical developments in freight rates. The respondents to the Delphi survey expect that rates will increase notably due to increases in operating costs, such as tax increases (e.g., the German kilometer tax for heavy freight vehicles), increased scarcities on infrastructure networks, and rising labor costs. Yet, at the same time it is expected that between 2001 and 2010 carriers will improve productive efficiency and improve load factors, for instance by an increased use of planning systems, reduced fuel use, and by increased efforts to acquire cargo for return trips. Regarding transit times, for all modes of transportation with the exception of road haulage, a reduction is expected between now and 2010. The reliability of freight transport, expressed in the number of overdue arrivals, is expected to remain the same or even improve, except for airfreight and road haulage (see the table below). Apparently, the latter modes will face increased congestion. Expected effects of passing on of all external social costs (scenario 1) If the social costs of freight transport are passed on to carriers as a ton-kilometer charge, this will lead to a relatively high increase in costs. The experts expect that by 2010 a part of the initial cost increase will be ‘evaporated’ by a change in operational management of carriers. The adaptations will vary between the transport modes. For all modes except for short sea shipping, the ton-kilometer charge will reinforce the acquisition of return cargo; improving load factors by co-operation between carriers in the form of cargo exchange, is considered likely in inland navigation, rail transport, airfreight, and short sea shipping. In all waterborne transport, it is expected that shipowners will try to reduce fuel costs by slowing sailing speed. The tonkilometer charge is eventually expected to cause a scaling-up of average firm size in rail transport, short sea shipping, and deep sea shipping. Adaptations in the size of transport means (vessels, vehicles, aircraft) are expected in inland navigation, airfreight, rail transport, and short sea shipping. Finally, road carriers, rail operators, airlines, and deep sea carriers will more often refuse small or unprofitable shipments. Expected effects of a strong increase in congestion (scenario 2) The effects of a hypothesized strong increase in congestion are also researched. The nature of congestion varies for each mode of transportation, however. For instance, in rail transport and airfreight, queuing is only to a limited extent possible, in contrast to the other modes, which is caused by the relatively rigid infrastructure capacity allocation systems employed. Yet, also in rail transport and in airfreight often delays occur, but it appeared that scenarios in which transit times initially increase by tens of percentages due to congestion are unrealistic. Hence, the congestion scenario was disregarded for rail transport, whereas an adapted scenario was constructed for airfreight. For the other transport modes, a substantial increase in congestion by the end of 2001 was assumed. In road transport, congestion is assumed to occur on line infrastructure, whereas in the other modes congestion is notably assumed to exist at ports and terminals. It is expected that the extent to which the initial delays affect transit times in 2010 varies significantly between the modes. The disproportional increase in transit times that is expected for inland navigation is in part explained by the fact that multiple ports are visited. Yet, in short sea shipping this is also the case. For all modes, a deterioration in reliability is expected. Also in this scenario, different responses of transport companies are expected. In road haulage, inland navigation, and short sea shipping, congestion will lead to a more intensive use of planning systems, whereas more in advance planning with shippers is considered likely in all modes except for airfreight. The use of larger transport means is considered likely for all sectors but inland navigation. Changes in departure times are only expected in road haulage, short sea shipping, and deep sea shipping; in the other modes, flexibility in scheduling apparently is low. In deep sea shipping and short sea shipping, more efforts to optimize load factors are expected. Finally, in road haulage it is expected that route choice will be adapted, whereas in airfreight, deep sea shipping, and in short sea shipping, other (air)ports will be called at. This is mainly explained by the fact that the scenarios assumed differences in the nature of congestion