Maritime Infrastructure Engineering and Management Program Rutgers University

Maritime Infrastructure Engineering and Management Program, Rutgers University, April 2006 Freight and the City: An Overview of Urban Freight Distribution and City Logistics Dr. Jean-Paul Rodrigue Dept. of Economics & Geography Hofstra University Hempstead, NY http: //people. hofstra. edu/faculty/jeanpaul_rodrigue/

Urban Freight Transportation: The Realm of the “Last Mile” ■ Contemporary Urbanization ■ A New Environment for Freight Distribution ■ City Logistics and Urban Freight Distribution

Contradictions between Passengers and Freight Transport Urban Transportation Commuting Shopping Recreation Intensity Commodity Chains Freight Trade Energy & Raw Materials Waste disposal Local distribution Business Tourism Migration Passengers Distance

Passengers and Freight Movements by Time of the Day: Contradictions

Freight and the City ■ For freight, cities have three major dimensions • Cities are zones of production: • Industrial location. • Cities are transport nodes: • Accumulation of transport terminals. • Intermediary locations. • Cities are zones of consumption: • Problem of urban distribution. ■ Dislocation between those functions • Notably between production, distribution and consumption. • Brought by globalization, global production networks and efficient freight transport systems (increasingly by logistics).

World Cities Moscow Toronto San Francisco Chicago Seoul New York Tokyo Los Angeles Hong Kong Mexico City Singapore London Frankfurt Brussels 1 st tier 2 nd tier 3 rd tier Sao Paulo Paris Geneva Milan Madrid Sydney

Traffic at the 50 Largest Container Ports, 2003

Key Issues in Urban Freight Transportation Issue Challenge Increasing volume of freight moving in urban areas Capacity of urban freight transport systems Changes in the nature of freight distribution Smaller volumes and time-sensitive freight Repetitiveness Many urban activities (retail, groceries and catering) require daily deliveries Environmental issues Growing demand for reverse logistic flows (waste and recycling) Emergence of e-commerce Growth in home deliveries Congestion Lower driving speeds and frequent disruptions (reliability) Regulation Emissions, access and zoning

Changes in the Urban Spatial Structure Multi-Nodal Core activities Peripheral activities Central area Major transport axis

Road Highway Activity center I III Transit line II IV

Possible Urban Movement Patterns Organized Primary flow Secondary flow Disorganized Monocentric Polycentric

Components of the Transportation / Land Use System • Economic base theory • Location theory • Traffic generation and attraction models Land Use • Spatial interaction models • Distance decay parameters • Modal split Spatial Interactions • Traffic assignment models • Transport capacity Transportation Network

Urban Transport: Assets versus Liabilities ■ Assets (Freight Transport) • Privately owned (profit motivated). • Relatively low entry costs (wages and rates subject to market forces). • Value added function (trade distance for cost). • Support industrial, manufacturing and commercial activities. ■ Liabilities (Public Transit) • Publicly owned (politically motivated). • Little or no competition permitted (wages and fares regulated). • Social function / “public service” (provides accessibility and social equity). • Limited relationships with economic activities.

Globalization, Commodification and Urbanization Factor Growth (1993 -2002) Retail goods sales 61. 8% Value of freight shipments 45. 3% Gross Domestic Product 33. 9% Ton-miles of freight 23. 8% ■ Longer supply chains • International division of the production. • Fragmentation of production, distribution and consumption. ■ International trade Tons of freight 18. 4% Population 10. 8% • Imbalanced freight flows. ■ Higher levels of consumption • Growing incomes (challenged) • Debt and equity extraction.

From Push to Pull Logistics Supplier Supplier Supplier Freight flow Manufacturer 3 PL Distributor Customer Push Returns / Recycling Pull Point-of-sale data Customer

Logistics and E-commerce Supply chain Warehousing E-Retailer Warehousing Retailer Customers E-Logistics Traditional Logistics Supply chain

City Logistics and Urban Freight Distribution ■ City Logistics • Relatively new field. • “The process for totally optimizing the logistics and transport activities by private companies in urban areas while considering the traffic environment, the traffic congestion and energy consumption within the framework of a market economy. ” • Means to achieve freight distribution in urban areas. • Improve: • Efficiency of urban freight transportation. • Reduce traffic congestion. • Mitigate environmental impacts.

U rb an Te rm in al City Logistics DC

Freight Corridors & Freight Clusters ■ Geographical consequences • Migrating to more affordable locations in the periphery. • Growth in tons-km. • Competition between passengers (commuters) and freight traffic. ■ Freight corridors DC • Expands the sphere of distribution. • Providing an axis along which distribution centers can reliably service many locations along the corridor. ■ Emergence of freight clusters • Functionally unrelated distribution facilities.

Large-scale Distribution Center Size Larger More throughput and less warehousing. Facility One storey Separate loading and unloading bays Sorting efficiency. Land Large lot Parking space for trucks. Space for expansion. Accessibili Proximity to ty highways Constant movements (pick-up and deliveries) in small batches. Access to corridors and markets. Market Regional / National Less than 48 hours service window. IT Integration Sort parcels. Control movements from receiving docks to shipping docks.

UPS National Freight Distribution Center, Chicago

Cross-Docking Distribution Center Before Cross-Docking Distribution Center Suppliers LTL Receiving Sorting Customers After Cross-Docking Shipping TL Cross-Docking DC TL Customers

The “Last Mile” Urban Transport Problem ■ The “last mile” problem • Common issue in logistics. • More time-based than cost-based problem. • Components: • Delivery time (e. g. duration, possibility to fix delivery date); • Reliability of delivery (e. g. availability of goods, order handling time); • Flexibility of delivery (e. g. delivery date, delivery address); • Quality of delivery (e. g. accurate delivery, condition of delivered goods). • Unattended delivery problem: • Mainly apply to parcel deliveries. • Contradiction between working schedules and delivery schedules. • Made worse by the growth of two income families.

Traffic Conditions in Major American Cities, 1982 -2003

Boston – Washington Corridor: Volume to Capacity Ratio

Huds on R iv er Toll Bridges and Roads, New York Metropolitan Area (1000 s of vehicles per day) d GWB ay ark w nh att an 100 HT 60 BBT 80 110 100 WSB 100 TBB QMT Queens 20 75 GTB BYB nd Tu rn p ik e Ga rde 125 Ma n. S tat LT NJ en tat a Isl S 75 OCB TNB Bronx e. P New Jersey ng Lo 300 Bay Raritan 210 VZB 20 MPB Yor and Long Isl 20 CBB Brooklyn Low Bay er New d lan Is k n Sou

Average Hourly Traffic on George Washington Bridge, 2002

Truck Freight Corridors New York New Jersey TZB Con 8. 4 23. 2 7. 8 GWB 5. 2 HT BBT EWR 6. 4 GTB BYB n ate St OCB 4. 8 1. 5 WSB 8. 4 TNB LGA and Long Isl QMT Queens 4. 2 1. 9 Brooklyn d an VZB Isl n 8. 6 an att nh LT t 7. 4 Bronx TBB Ma 5. 7 u ctic e JFK Major Crossing 2. 0 1, 000 of Trucks per Day (2000) About 70 million truck crossings per year

Logistical Strategies to Cope with Urban Congestion Shipping less Demand responsive systems. Reduce returns. Shipping timing Allow greater shipping time and outside rush periods. Efficient packaging Reduce the shipment size (volume) of the same load. Modal shift Use a mode that is less impacted by congestion.

Challenges to Urban Freight Distribution ■ Multimodal Integration of Freight Transportation • Problem of modal dependence (80% trucking). • Specialization of modes, modal shift and freight diversion. ■ Entropy and Energy • Maintaining the cohesion and productivity of freight distribution. • Growing disorder and energy costs. ■ Urban/Suburban Supply Chains • • Coping with the “last mile”. Difficulties to maintain just-in-time and timely supply. High distribution costs. Adaptation of modes and delivery times.