FREIGHT TRANSPORT AT ANY PRICE? EFFECTS OF TWO TRANSPORT COST SCENARIOS ON BOOK AND NEWSPAPER SUPPLY CHAINS

Increasing efforts can be observed within Europe (both at the level of the European and on the level of individual Member States) to slow down the growth in freight transport, in particular transport by road. One of the instruments that is gaining popularity is taxation. From an economic perspective, this instrument is justified because 'internalization' of the external costs would lead to a more efficient allocation of transport resources, thus raising welfare. In practice, however, it seems that shipping firms who generate the demand for freight transport have become less and less sensitive to transport costs: the logistical organization has become more and more transport-intensive, due to among others centralization of production and elimination of inventories. Minimization of logistical costs other than the cost of transport seems to be of primary importance to shipping firms. This raises the question to what extent transport policies that aim to affect transport costs will prove to be effective in reducing the growth in freight transport. The effects of two specific transport interventions that directly affect transport costs are explored: (a) the internalization of marginal external social costs by means of a charge per ton-km, levied on carriers; and (b) a very restrictive infrastructure policy, which in combination with an expected growth in both passenger and freight transport, will lead to a substantial increase in congestion. The survey focused on road haulage, inland navigation, rail transport, airfreight, short sea shipping, and deep-sea container shipping from or to the Netherlands. It appeared that carriers are expected to absorb a relatively large part of the initial negative effects of these policy scenarios by adapting their transport operations (e.g., increase load factors by acquiring more return cargo, co-operate more with other carriers). This indicates that a more efficient use of transport equipment is possible. This paper also examines how shipping firms may respond to the changes in generalized transport costs, that the Delphi participants expect as a result of the above two policy scenarios. The main response of shippers to the ton-kilometer scenario, in which carrier rates increase by on average 50%, is raising prices; relatively few modifications on the level of logistical systems are mentioned. Apparently, the costs related to transit times and delivery reliability were more important than direct transport costs. For the covering abstract see ITRD E124693.

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  • Authors:
    • Runhaar, H
  • Publication Date: 2002

Language

  • English

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  • Accession Number: 00988352
  • Record Type: Publication
  • Source Agency: Transport Research Laboratory
  • ISBN: 0-86050-340-2
  • Files: ITRD
  • Created Date: Apr 4 2005 12:00AM