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  1. Broker:
  2. Specialized carriers
  3. Air-shipped products are generally:
  4. 2000 - Electronic Signatures in Global & National Commerce Act
  5. Pipeline accounts for about 68 percent of all crude and petroleum ton-mile movements in US
  6. Transportation consumes time, finances, and environmental resources. Transportation:
  7. Motor carrier has expanded rapidly since the end of world war II
  8. Staggers Rail Act deregulated the rail industry
  9. 2000 - Continued Dumping and Subsidy Offset Act
  10. Transportation Regulation
  11. 1984 -- Shipping Act
  12. Stowage Planning
  13. Economy of Scale:
  14. Exempt Carriers -
  15. Diversion occurs when
  16. Product can also be stored in transport equipment at
  17. More AIR shit
  18. Water/Ocean - Rates
  19. General freight carriers
  20. 1920 - Merchant Marine Act
  21. Intermodal
  22. Transportation security
  23. Owner operator:
  24. Characteristics of parcel
  25. Rates:
  26. Transportation Functionality
  27. Contract Carriers -
  28. Hours of Service (HOS) Rules STOP HERE
  29. Ocean mode is the oldest form of US transport dating back to the birth of our nation
  30. Asset-based:
  31. 2001 - Patriot Act
  32. Truck-load (TL)
  33. Less-than-truckload (LTL)
  34. Rail
  35. Characteristics:
  36. Transportation Structure
  37. Private Carriers -
  38. Economy of Distance:
  39. Transportation Regulation Pro's and Con's
  40. Regulation time period
  41. Drayage
  42. Who Uses Airfreight and Why?
  43. Transport Participants
  44. A mode identifies
  45. AIR
  46. Transportation Deregulation
  47. Parcel
  48. Social Regulation
  49. 1995 ICC Termination Act and the 1998 Ocean Shipping Reform Act
  50. Fundamental Transport Principles
  51. Ocean
  52. Two important aspects of transportation are:
  53. Economic Regulation
  54. Commodities are evaluated and grouped based on four characteristics:
  55. Steamship Line
  56. Rail ish more
  57. Common Carriers -
  58. NVOCC (Non-Vessel Operating Common Carrier)
  1. a 1984 - Shipping Act
    Allowed ocean carriers to pool shipments, assign ports, publish rates, and enter into contracts with shippers
  2. b 1976 - Railroad Revitalization and Regulatory Reform Act
    Railroads could change rates without ICC approval

    1977 - Air freight deregulated

    1980 - Motor Carrier Act deregulated the motor carrier industries
    Entry restrictions for new businesses were relaxed
    Restrictions for types of freight and range of services were abolished
    Individual carriers were given the right to price their services
    Trucking industry's collective rate-making practices were abolished
  3. c Restrictive Element — in-transit inventory is "captive", usually inaccessible during transportation

    Flexible Element — inventory can be diverted during shipment to a new destination
  4. d Asset based company operating the ships with whom both cargo owners (sometimes called BCO - Beneficial Cargo Owner) and NVOCCs contract with for the carriage of goods.

    Note, a steamship line cannot handle a LCL (less than container load) booking directly. A Freight Forwarder would need to be involved.
  5. e Parcel Shipments are usually packages that weigh < 150 lbs
    There are multiple service levels
    Next Day, 2nd Day Air, 3rd Day Air, and Ground (1 - 5 days
  6. f - transport commodities like liquid petroleum, household goods, building materials, and other types of specialized items.
  7. g Percentage of ton-miles has stayed between 19 and 30% since 1960's
    Ranks between rail and truck in fixed cost
    Right of way (canals and rivers) maintained by Federal government
  8. h Only U.S.-built ships operating under a U.S. flag with U.S. crews can ship goods directly from a U.S. port to another U.S. port
    The thought at one time was that such a law would promote U.S. shipping by providing preferential treatment of US vessels over "foreign" vessels.
  9. i FCL (Full Container Load) is a cost per container.

    LCL (Less than Container Load) is a cost based on whichever is greater, the space in cubic meters or the weight in metric tons

    Demurrage = Holding a container at port beyond a certain time limit and incurring a penalty charge such as a daily rent after the free time ends. This is commonly referred to as storage when container is held at a rail yard.

    Per Diem = Holding a container off port beyond a certain time limit and incurring a penalty charge such as daily rent after the free time ends.

    Fuel (BAF) = Bunker is the type of fuel burned by vessels. BAF, or Bunker Adjustment Factor is a per container fee charged by the carriers for this fuel.
  10. j Gave digital signatures legal status
  11. k -Product can also be stored in transport equipment at origin or destination (trailers, containers, railcars, pipeline, etc.)
    -Usually more expensive than traditional
    -Must pay rental or demurrage charges on transport
    equipment used for storage
    -Less secure
    -Special handling, i.e. cold chain, could be an issue
  12. l Total on-duty hours = 14 hours
    Consecutive days hours = 11 hours
    Mandatory break = 30 mins after 8 hours
    On-duty "retstart" = 34 consectutive off duty hours
    Penalities for not following rules for both DRIVERS and COMPANIES
  13. m ICC was eliminated and a requirement for ocean carriers to file rates ended
  14. n ex: Walmart
    Carrier having their own tractors and trailers and responsible for maintenance of all their equipment. Traditionally, truckload carriers look to replace tractors every 3-4 years and trailers every 7-8 years.
  15. o Lowest per unit cost for transportation
    Highest fixed cost. Lowest variable cost of all modes
    Most reliable form of transportation
    Can operate 24 hours a day, 7 days a week
    No emissions
    No empty container or vehicle to return
    Little maintenance needed once the pipeline is running.
    Not flexible. Limited in the variety of commodities they can carry.

    -Materials are transported in a liquid or gaseous state
  16. p Provided railroad management with freedom necessary to revitalize the industry
    Rail carriers were authorized to use selective pricing to meet competition and cover operating costs
    Carriers were given increased flexibility with respect to surcharges
    Contract rate agreements between individual shippers and carriers were legalized
    Rail management given liberal authority to proceed with abandonment of poorly performing rail service, i.e., eliminate unprofitable routes.
  17. q Compete for transportation when the distance is long and the shipments are heavy or bulky.

    Rail is slow and inflexible

    Rail carriers have begun purchasing motor carriers and can now offer point-to-point pickup and delivery service known as trailer-on-flatcar (TOFC) service.

    Rail companies use each other's rail cars. Keeping track of rail cars and getting them where needed can be problematic.

    Railroad infrastructure and aging equipment are also problems for the railroads.

    Paired with trucks for door-to-door delivery
  18. r Each carrier has a minimum charge for LTL.
    Some have one overall minimum charge, but many carriers are more specific for minimum charges for hard to reach destinations.
  19. s Consignor (Shipper)
    Consignee (Receiver)
    Carrier and Agents
  20. t seeks to make transportation equally accessible and economical to all without discrimination

    Government created infrastructure (roads, canals, ports, etc.)

    Intended to prevent carriers from taking advantage of shippers while ensuring long-term financial stability for carriers
  21. u Fines for artificial underpricing and "dumping" of foreign goods in U.S. markets. Repealed effective October 1, 2007
  22. v Rail has historically handled the largest number of ton-miles within continental US 9% total freight expense.

    -Track mileage has declined by over half since 1970 (until 2005 and then stabilized)
    -Traffic shifted from broad range of commodities to hauling specific freight in traffic segments (bulk items, heavy items)

    -New technologies include articulated cars, unit trains and double-stack cars

  23. w a shipment destination is changed / re-routed after a product is in transit
  24. x Medical Device & Diagnostics (MD&D)
    -Normal supply chain
    -Inventory levels
    -Product value supports the cost
    -Normal supply chain
    -Risk in transit
    -Freight characteristics
    -Product value supports the cost
    Consumer Products
    -Exception basis
    -Risk to customer launch/promotions
    -Unexpected demand
  25. y 1800's - The rise of steamships and railroads created immense wealth and monopolies (e.g., Commodore Vanderbilt and the railroad "barons")
    1870's - Granger laws regulated the Railroads
    1887 - Interstate Commerce Act created the Interstate Commerce Commission (ICC) to oversee interstate transportation
    Primarily to stop the railroad monopolies
    1920 - Transportation Act changed the Interstate Commerce Act
    1935 - Motor Carrier Act brought motor carriers under Interstate Commerce Commission control.
    1940 - Transportation Act established Interstate Commerce Commission control over domestic water transportation
    1958 - Federal Aviation Act created air traffic and safety regulations and the national airport system.
    1966 - Department of Transportation Act established to coordinate all transportation-related matters.
    By 1970, ICC had oversight of
    100% of rail and air
    80% of pipeline
    43% of trucking
    6% of water carrier operations
  26. z Inexpensive
    Slow and inflexible
    Competes with rail and pipeline.
    Includes inland waterway, coastal and intercostal, and deep-sea.
    Inland waterway transportation is used for heavy, bulky, low-value materials (e.g., coal, grain). Barge
    Paired with trucks for door-to-door delivery.
  27. aa carriers move small shipments, when you don't have enough to fill a truck. Stop at depots and transfer locations to match load to the final location.
  28. ab Max Freight Weight: ~45,000 pounds
    Entire truck weight cannot exceed 80,000 pounds
    Typical tractor weighs 35,000 pounds
    Standard trailer: 53' Long x 8'6" Wide x 9' High
    Max Cube Utilization: 3,509 cube
    Max Pallets: 60 (assuming 40"L x 48"W x 48"H)
    Booking a shipment requires at least 24 hours advance notice
    Team Service: roughly 10% - 15% up charge on standard rate (depending on the carrier)
    Rate structure - flat rate or cost per mile
    Drop trailers vs. live load/unload
  29. ac Exempt from regulation of services and rates if they transport exempt products like produce, livestock, coal, or newspapers.
  30. ad High value
    High priority
    Extreme perishability
  31. ae Not bound to serve the public. Serve customers under contractual agreements.
  32. af 1.) Primarily consists of product movement services

    Product movement is the transfer of inventory to specified destinations.

    2.)Secondarily consists of product storage services while product is in a vehicle / conveyance
    -In-Transit Inventory is captive in the transport system
    --Managers strive to reduce in-transit inventory to a minimum
  33. ag Consists of rights-of-way, vehicles (conveyances) , and carriers operating within five basic modes
  34. ah Social and Economic regulation
  35. ai is the act of allocating space to containers on board a container ship in the order of the discharge ports.

    -Scheduled list of ports that the ship will be calling at, in the order of rotation
    -A summary of the number of containers - size/type/weight of containers per port that are planned to be loaded on the ship
    -A summary of the number of hazardous, reefer and of dry containers per port that are planned to be loaded on the ship
    -A list and summary of containers that are on board after discharge of the containers at your port
  36. aj FedEx:
    -Has 2 separate operations
    -One for air
    -One for ground
    -Drivers are independent contractors

    -Has one operation for both air and ground
    -All drivers are UPS employees
  37. ak Expensive relative to other modes of transportation
    Cannot carry extremely heavy or bulky cargo.
    Mostly for light, high value goods over long distances quickly.
    Half of the goods transported by air are carried by freight-only airlines, e.g., FedEx.
    Paired with trucks for door-to-door delivery

    Shipment size is > 150 lbs (70 KG)
    Parcel/Express is < 150 lbs
    Parcel is never on a pallet
  38. al -Accounts for more than 60% of the total cost of logistics
    -Is one of the largest consumers of oil and gas
    -Negatively impacts traffic congestion, noise and air pollution
  39. am A company (often a forwarding agent) who does not own or operate the carrying ship, but who contracts with a shipping line for the carriage of the goods.
  40. an Commonly used to mean the transportation of containerized cargo by specialized trucking companies between ocean ports or rail ramps and shipping docks in intermodal freight transport.
  41. ao Social regulation which takes measures to protect public safety and the environment

    -Department of Transportation (DOT) (1966) took an active role in hazardous material safety and driver safety

    -Hazardous Materials Transportation Uniform Safety Act (1990) took precedence over state and local regulations
  42. ap Economy of Scale and Distance

    -The goal is to maximize the size of the load and distance shipped while still meeting service expectations
  43. aq The cost per unit weight decreases as distance increases
    Often called the tapering principle
    Longer distances allow the fixed cost of the carrier to be spread over more miles, lowering the per mile / per unit charge.
  44. ar serve the public at published rates between locations without discrimination.
  45. as Person or company who does not own their own equipment. They contract with an asset-based carrier (or an owner operator) for the carriage of goods
  46. at 2001 - Aviation and Transportation Security Act created the Transportation Security Administration (TSA)
    2003 - Department of Homeland Security (DHS) was created to provide overall U.S. security leadership.
  47. au Density (Primary) - Space in relation to its weight
    Stowing - Ability to load other freight in the same trailer
    Handling - How difficult it is to actually handle the freight
    Liability (value and risk) - Potential claims from damage or loss

    18 classes: (50-500)
  48. av -81% US Freight expense
    -Nearly 1 million miles of highways in U.S.
    Key benefits include
    -Speed of transit
    -Ability to operate door-to-door
    -More efficient than rail for small shipments over short distances
    -Dominate freight moves under 500 miles and from manufacturing to wholesalers to retailers
    -Many companies run their own truck fleets as well (e.g., Walmart)
    Most flexible mode of transportation.
    Carries > 80% of U.S. Freight.
    Competes with Rail and Air for short-to-medium hauls.
    Accounts for only 1% of intercity ton-miles
    Fastest of all the modes
    Fixed cost is 2nd lowest
    Variable costs are extremely high
  50. ax interchange of equipment between differing modes of transportation to execute a single transport, which includes: rail, truck, or ocean.

    Rail and motor carriers or rail and water carriers can offer point-to-point pickup and delivery service
    Water and motor can offer point to point service for overseas manufacturers

    -RO-ROs or roll-on-roll-off containership truck trailers and containers can be directly driven on and off the ship without the use of cranes
  51. ay -a basic transportation method or form
    Motor Carrier / Truck
  52. az Pro's - Regulation tends to assure adequate transportation service throughout the country. Protects consumers from monopoly pricing, ensures safety, and creates liability.

    Con's - Regulation discourages competition and does not allow prices to adjust based on free market demand or through negotiation.

    -U.S. transportation industry remains mostly deregulated
  53. ba Person who owns his own tractor and is responsible for the maintenance and upkeep of his tractor.
    Types of owner operators:
    Sole source
    Free agents
  54. bb not subject to economic regulation. Typically transport goods for the company owning the carrier.
  55. bc Increased inspections at ports, airport security, and increased security at border crossings
    C-TPAT, CSI, etc.
  56. bd - carry the majority of goods shipped. Includes common carriers.
  57. be carriers are used when you have enough to fill the truck, or you don't want other suppliers cargo on your truck (security, faster delivery)
  58. bf The cost per unit weight decreases as the size of the shipment increases
    At least until you totally fill the conveyance (i.e. "max out" or "cube out").
    Cost decreases because the fixed cost of the carrier is allocated over a larger weight of shipment.