Tuesday, July 3, 2012

Go Green with Efficient Freight Logistics

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Freight logistics across the world account for at least 1/3rd of fuel consumption and carbon dioxide emissions. Employing efficient transportation mode(s) will reduce carbon emissions and energy costs. For instance according to one of the IEA publications, shifting to more efficient freight transportation modes is expected to reduce CO2 emissions by at least forty per cent. Road transport consumes significantly more energy per tonne-km than rail or ship freight transport. Using more marine and train solutions to supplement truck transportation will reduce the emissions. But because freight can't be shipped to every place using train or marine, freight transporters prefer road transportation. Multi-modal transportation integrating road, rail and marine offers the best solution in such cases. Banking more on LTL (Less-than-truck-load) for goods shipment will not only reduce transportation costs for firms but also reduces congestion and impact on environment. However, when orders need to be expedited transporters bank on trucks for direct shipment. In such situation, logisticians should employ better practices that will improve logistics efficiency and cut carbon emissions.   More efficient logistics reduced the Volvo Group’s carbon footprint by 22 percent.
Use of advanced methods & tools for Vehicle Routing & Scheduling and load planning can optimize both loads and traveling distance. With the help of longer vehicles, firms can transport more goods during each run. For instance, use of truck rigs that are 25, 32, 40 meters long will make road transportation more efficient. Rigs will be able to ship two to three 40-ft containers, thus reducing CO2 emissions per ton per kilometer drastically. Besides, theoretical and practical training for truck drivers in fuel-efficient driving, will improve the fuel efficiency. Further, trucks should be equipped with more modern engines, which consume less fuel and emit less carbon dioxide. During 2006 - 2010, such green logistics practices helped Volvo Group’s transportation of goods in Europe reduce their carbon footprint by 22 percent improving their logistics efficiency.

2 comments:

  1. LTL reducing transportation costs. If the capacity of a truck or carrier is say 10 tonnes and the vehicle is designed to carry 10 tonnes,loading 10 tonnes of material should give the optimal result in terms of cost. However, if we operate in LTL scheme, I would imagine that the number of vehicles to transport the same load would increase. Would you please clarify as there appears to be a dissonance in your remark and my understanding. Secondly, use of longer vehicles is certainly a solution when the terrain and topography would permit such carriers to move.

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  2. Less-than-truckload (LTL) is a service offered by many freight and trucking companies including package carriers (like DHL), third party logistics (TPL), rail logistics network (like CONCOR), shipping vessels, air cargo, etc. These carriers ship goods of multiple shippers and therefore cost is shared. Whereas if excclusive truck (TL industry) is used, cost should be borne by the shipper alone irrespective of the size of shipment(whether half or full truck).

    A less-than-truckload (LTL) shipment is delivered with various other shipments and is usually not delivered directly to a destination as like exclusive carrier. LTL brings down unit shipment cost compared to exclusive carriers when shipment size is less and therefore LTL is an economic option. LTL is an efficient option used when speed of delivery is not important and shipment size is less than truck load. However when load can be optimized (i.e., full truck space is utilized) and unit shipment cost is less, exclusive carrier (a private or contract carrier) is a better option than LTL. Further, when shipping heavy weight, voluminous or bulky items, LTL tariff may be high and hence shipment cost (in case of LTL) may be higher compared to exclusive carrier (TL).

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