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Fast freight movement - Overcoming today's intermodal challenge

Containerization has revolutionized the movement of goods around the world, delivering compelling economic, safety and environmental benefits in both mature and developing markets.

Warren Williams Principal

by Warren Williams

Principal, Melbourne

22 August 2017
fast rail

Defining features of intermodal transport include; a high level of systems integration, hardware standardization and stringent interfaces. Although these conditions enable intermodal’s greatest benefits they also serve to restrict innovation opportunities. 

The fundamental goal of freight movement efficiency, together with safety, environment and social impact, are all critical factors driving the growth of the intermodal transportation industry - though the challenges that are often faced are complex and multi-dimensional. 

Whether it’s a shipping agency determining how best to move freight across multiple transport modes, a terminal operator wanting to reduce costs through improved efficiencies or a rail operator seeking the best rolling stock design, fleet composition, and ownership model to maximize returns, a long-term outlook and a holistic understanding of all viable options are key to sanctioning and securing funding for the right project and delivering the best outcomes. 

Revival of freight rail networks

Our major cities developed and initially grew around the port precincts. However as our cities have expanded, our ports have been unable to similarly expand their footprint as they were hemmed in by nearby commercial and residential developments. 

Deficient urban planning has often resulted in inadequate freight rail capacity at ports, forcing large volume container movements onto city and inner urban roads, with trucks now contributing significantly to congestion, air and noise pollution and threatening road safety.

The revival of dedicated freight rail networks to access ports is critical to reducing subsequent social and economic impact of these issues. "Inland ports" and freight hubs located close to interstate highways and mainline railways can be well planned and established with lesser constraints of real-estate and existing infrastructure than those experienced at established large city ports, enabling the marshalling, storage and transfer of containers to be performed with far greater efficiency and safety. 

Port rail shuttle services allow decentralization of activities traditionally carried out at ports which are not functionally necessary. These services include container storage and freight accumulation, blending and distribution.

In addition to improving local modal connectivity, a more recent intermodal development, land-bridging by rail, affords reliable remote port accessibility for freight in large volumes, more efficiently than by road. 

fast rail

Intermodal freight movement is an important contributor to our economic prosperity and living standards. It works most efficiently when assets and operations are specified to optimally match the transport task, and when all of the elements of the system are treated as an integrated system.

Opportunities, challenges and our responses

Identifying and accessing intermodal opportunities entails recognizing and surmounting a range of challenges. Below discusses the key opportunities, challenges and our response to activate intermodal opportunities.

Speed and reliability

Two recurring themes, “speed and reliability,” often drive our clients’ thinking and figure heavily in their decision-making for transport partners. 

Our response to meet these business performance demands include:

  • Adopting an end-to-end supply chain approach to understand trade-offs
  • Identifying, prioritizing and treating critical path bottlenecks
  • Quantifying the operating envelope and applying these conditions to all performance forecasting to learn best and worst case scenarios before the worst case manifests into practice
  • Using simulation to trial, explore, develop and prove options
  • Paying careful attention to system interfaces, both internal to and at the boundaries of, any project undertaken
  • Benchmarking Reliability, Availability, Maintenance and Safety (RAMS) performance against real-world outcomes.

Common user infrastructure: The great competition equalizer

Complete vertical integration of the supply chain allows for optimized performance, not only of each element of the supply chain, but also and most significantly, the entire fully-integrated system. Perfect circumstances rarely occur, often due to competition regulation that leads to shared or common-user facets of the supply chain between ends. 

Typically roads, mainline railways and ports, service multiple customers. The challenge for intermodal operators is to obtain and sustain a competitive advantage when such a large component of the system is competitively normalized. 

This can be achieved by:

  • Identifying opportunities for maximizing the utilization of facilities and services provided under common-user contracts
  • Negotiating access agreements from a thoroughly informed perspective
  • Identifying opportunities to co-invest in infrastructure and to independently develop complimentary infrastructure not subject to common user obligations
  • Specifying workable innovative vehicles whose performance on the common user infrastructure is superior to the norm.

Matching assets and operations optimally to the transport task

Intermodal transport tasks are rarely static over time. Container mass, length and height distributions vary between ports as the nature of freight changes and as shippers become more - and sometimes less adept - at simultaneously “grossing out” and “cubing out” containers. 

Responses to overcoming this challenge include: 

  • Optimally matching assets and operating plans as an integrated system to deliver a nominated base case and forecast evolution of the task
  • Conducting transport performance modeling using actual supply chain parameters to create accurate performance estimates
  • Recognizing technical and commercial aspects of projects and related financial transactions are in fact inseparable
  • Managing technological obsolescence risk by identifying and responding to trends by future-proofing assets (such as locomotives and wagons) whose economic life may exceed 25 years
  • Engineering intermodal vehicles as part of an optimized system to deliver a specific task - this approach is particularly relevant when there is sufficient assurance concerning duration of the business. In some cases engineering will deliver an optimal outcome - by conceptualizing container, railway wagon and road trailer as an integrated asset system, it has been possible to move freight using the intermodal method, otherwise believed to be impossible.   

Intermodal freight movement is an important contributor to our economic prosperity and living standards. It works most efficiently when assets and operations are specified to optimally match the transport task, and when all of the elements of the system are treated as an integrated system.

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