Choosing the Right Mode of Freight Transport -- Ancient Routes and Sustainability

When it comes to passenger transport many of us, if not all, have our favorite mode of trasport.

Of course, it also depends on your origin node and destination node -- where you are located, say, point A, and where you want to go to, say, point B.

When I teach my Transportation & Logistics class at the Isenberg School of Management, I always ask my students what their favorite mode of transportation is and, interestingly, over the past several years, I have been getting more and more responses of TRAINS! Of course, many of the students who respond thus are those who have been lucky to have had opportunities to travel outside the U.S. and they speak of great rain rides in Europe, Canada, and, sometimes, even in Asia!

But trains are also being used to carry cargo and freight trains have been in the news lately, including the really bad and sad news of the Montreal Maine & Atlantic Railway (MMA) train that derailed with 72 oil tanker cars in Lac-Megantic, Quebec, with an estimated loss of 50 lives. This was North America's deadliest train accident in over 20 years. The cargo was a highly flammable oil so the cargo was  hazmat (hazardous materials) and there was only one crew member operating this train. Speculation lies with a brake issue -- the operator was asleep in a hotel when the runaway train barreled on and exploded, devastating the small town and community.

Clearly, choices had to be made in terms of which mode of transport to use for the cargo, and since pipelines were not available to transport the oil obtained by fracking in North Dakota, it was decided to use rails to get to the refinery.There has been a 28,000% increase in the amount of oil shipped by rail over the past 5 years.  Getting the oil to refineries, as in New Brunswick, for example, which are not connected by pipelines (the new oil supply chains), is driving  the growth in this freight mode of shipping.

We use different criteria in selecting our optimal passenger modes and, in the case of the Quebec freight train disaster, safety as a criterion was not a priority. Only having one crew member for this train was shocking. Every airplane pilot needs a copilot.

Now, let's journey to the other side of the globe -- to Asia, where a "new" mode of transport that follows ancient routes from the colossal manufacturer China, with the help and vision of U.S. companies, notably, Hewlett-Packard (H.P.), the high tech company, is changing the supply chain distribution landscape and the new economic geography.

I was delighted/ecstatic to read in a captivating article, "Hauling New Treasure On the Silk Road," in the Business section of yesterday's edition of The New York Times,  the following statement: persistently high oil prices made the cost of airfreight daunting -- as much as seven times the cost of rail freight. H.P. was also concerned about the carbon emissions involved in air freight, which are 30 times those of the rail or sea routes.

Impressive -- H.P. is using freight trains for shipping its high value, high tech  goods, manufactured in western China, over 7,000 miles, with some trains as long as one half mile, to Europe because it cares about sustainability! And, the article notes that the crew is replaced every 3 to 4 hours and the shipments tend to arrive from the origin node (western China) to the destination  node -- a distribution center in The Netherlands in 21 days. H.P. has even helped out with customs software to make the processes flow more smoothly and more reliably as the precious cargo transits through Kazakhstan and onwards west to Europe.

H.P. has pioneered the revival of a route famous and known as the Silk Road since the Roman Empire.  The Romans certainly knew a lot about transportation and I even brought that out at The New York Times EnergyforTomorrow Conference in NYC on April 25, 2013 -- you can view the video here.   However, now the precious goods that are hauled are transportd by freight trains at certain frequencies, and not by horses and camels, as was the case back in 120 B.C. Plus, the cargo is quite different from that of over 2,000 years ago, with the exception of perhaps the precious silks for European markets!

For all the transportation geeks and train buffs out there The New York Times has some great photos of what you might encounter on this journey. 

Of course, H.P. is also using other modes of transport but, given, the investments of many countries along the freight rail route, as well as interest by other manufacturers and freight service providers, including  DHL, it has certainly started something very positive and worthwhile both economically and environmentally.

Coincidentally, the most recent paper that I co-authored is on this general topic: Supply Chain Network Sustainability Under Competition and Frequencies of Activities from Production to Distribution, Anna Nagurney, Min Yu, and Jonas Floden.

Finally, a few days ago, I had a great conversation with a New York Times reporter, Kirk Johnson, on the failure of the CRC project, which consisted of a new bridge joining Portland, Oregon with Vancouver,  Washington after $175 million in planning was spent. The plan called for combining freight, private and public transport (including bicycles) on the bridge. You can access the full article with my quotes here.