Chapter 7 Transportation 1

Transportation includes the following activities: Mode selection Freight consolidation Carrier routing Vehicle scheduling Rate auditing

Transportation-Logistics-Marketing Interface Moving product to the markets that are geographically separated Transportation cost impacts the selling price Providing added value to customers-transporting the products to the right place in right condition, at right time, in right quantities. Transportation contributes to the improvement of customer service levels and in consequence to providing customer satisfaction

Transportation service characteristics affecting customer service level Consistency of service Time-in-transit Market coverage (door-to-door service) Air-water-pipeline-rail transport---terminal to terminal / Road transport----door to door Loss/damage performance Flexibility (having flexible network) Versatility (transporting different products in varying sizes and weights)

Factors Influencing Transportation Costs 1 7 Factors Influencing Transportation Costs PRODUCT-RELATED FACTORS Density: Weight to volume ratio ( relatively heavy to given size) Low density products ( toys, clothing) are low in transportation costs High density products ( steel, canned food) are high in transportation costs Stowability: (cube utilization) Degree to which a product can fill the available space in a transport vehicle. Petroleum versus machines Ease or Difficulty of Handling Need for Strong Protective Packaging Products’ Hazardous Characteristics Liability : Value to weight ratio high liability-jewelry, art paintings

MARKET-RELATED FACTORS Government regulation Freight traffic into and out of a market Domestic versus international movement Degree of intramode/intermode competition Location of markets Seasonality of products

MAIN TRANSPORTATION MODES Each mode is characterized by a set of technical and operational attributes. Road transportation Rail transportation Air transportation Water transportation Pipeline

ROAD TRANSPORTATION It is the most commonly used mode of transportation (e.g: Turkey95%, USA43% for local and regional transportation) Relatively rapid transit times in local and regional transportation Road transportation is versatile, numerous types of vehicles in use, that can carry varying sizes and weights over any distance : Bulk materials, liquids, containers to refrigerated goods. Ama kaza sayısında 195 ülke arasında 12. sırada Türkiye !!!

ROAD TRANSPORTATION Road transportation is flexible and has widest market coverage Road network is very developed and branchy- this enables point-to-point service between almost all origin-destination combinations FACT : There are more buses and trucks in Turkey than the total number of all buses and trucks that European countries have.

RAIL TRANSPORTATION In Turkey Lacks versatility: fixed to track facilities-rail network incapabilities Lacks flexibility:terminal-to-terminal services unless the companies have a rail siding at their facility like in Vestel

RAIL TRANSPORTATION water-pipeline-railways-motorways-airway it is a relatively cheap form of transport. water-pipeline-railways-motorways-airway Cost of building 1 km. highway= Cost of building 5 km. railway this relative cheapness is particularly important factor if the freight consignments are bulky and heavy the movement is for medium to long distances if the speed is not very important attribute (in general rail transport is relatively slow)

High speed rail Generally for passenger transportation Routes: Ankara-Konya Ankara-Eskişehir (250km/h) -------Ankara-İstanbul and Ankara-İzmir lines are underconstruction In USA, France and Japan, there are trains with 450 km/h speed that compete with air transportation.

Terms for Railways A railroad car (railway carriage) is a vehicle on a rail transport system (railroad or railway) that is used for the carrying of cargo or passengers. A unit train (block train), is a railroad train in which all the cars are shipped from the same origin to the same destination.

Hazırlayan:2/V Müd.Yrd İlhan ÇETİN Railcar Types 21.09.2018 Hazırlayan:2/V Müd.Yrd İlhan ÇETİN

Railway Projects In 2012, the allowance for railways increased to 4.1 billion TL and projects have been launched out to develop international railways: Marmaray (London-China) Kars-Tiflis-Bakü (to regenerate Silk Road) BALO Project (Büyük Anadolu Lojistik Organizasyonu)(TOBB,Utikad, etc.)

Privatization Railcar ownership Railcar rentals Reform in Turkish Railways -With a new regulation, railways will also be privatized like airways to create market competition. By these regulations, private companies can manage their own coaches, locomotives and personnel to have their own freight train business. *http://www.rayhaber.com/2012/demiryollarinda-serbestlesme/

Characteristics of Air Transportation Suitable for emergency and high value to weight products like fashion goods and spare parts, premium ( customer service importance) service Quickest transit times on long distances and international movements Damage and breakages are less. Frequent and reliable service Very flexible and can be operated without establishing costly stock-holding networks. There may be delays due to airport congestion or due to handling and paperwork. It is very costly. Consumes more energy per ton-kilometer than any other transport mode.

The busiest airports HJ ATLANTA, US - 92.365.860 passengers/year BEIJING International, China - 77.403.668 LONDON Heathrow, UK - 69.433.565 CHICAGO O’Hare, US - 66.561.023 TOKYO Int., Japan - 62.263.025

Contemporary issues 3rd airport in Istanbul 6 landing fields on 3.500 hectares. Passenger capacity of 120 million.

WATER TRANSPORTATION Global sourcing, container ships, VLCC (very large crude carriers) Common differentiation of water transportation Inland waterways transport (e.g. Amsterdam) Sea transport

WATER TRANSPORTATION Suitable for bulk goods and low price goods (coal, oil, coal, wood,…) -In containers variable goods can be transported Depends on geography, rivers and channels network Generally, transport distances are longer Slow transportation and long transit times Depends on climate and seasonal characteristics (fog, water level, ice)

Characteristics of Water Transportation Most of the foreign trade uses sea type of transport. Energy usage per ton-kilometer is the least in comparison to the other modes. Transportation costs are 2-3 times lower than in rail. Advantages of sea transport can be visible at distances longer than 1000 km. Port management and port’s equipment is very complex and expensive

The biggest ports in the world (in terms of work load) Some facts The biggest ports in the world (in terms of work load) The share of water transportation in total export is 52% in Turkey. While Greece gains 60 billion $ with water transportation, Turkey’s share is nearly 2,5 billion $. Singapore Rotterdam, Netherlands South Louisiana, U.S.A. Shanghai, China Hong Kong, China Houston, U.S.A Chiba, Japan Nagoya, Japan Ulsan, South Korea Kwangyang, South Korea Rotterdam port

Some characteristics of the biggest ports in Turkey Mersin: 21 docks enables to handle nearly 30 ships at the same time. In a year, the average tonage of handling is 15 billion. İzmir: The length of the dock is 2.959 m, and in a year 3.640 ships visit the port. Trabzon: The biggest port of Eastern Black Sea. In 2009, 1.242 ships visited the port and 21.000 containers are handled. İskenderun: The length of the dock is 1.426 m, and the capacity of the port is 640 ships/year. http://www.lojistikhatti.com/haber/2013/01/turkiye-nin-en-buyuk-limanlarinin-ozellikleri

Contemporary issues Petkim Container Port Çandarlı Container Port It will be the biggest integrated port of Aegean region. Its capacity will be 50% more than Alsancak port. Integrated to railways. In total, 48 hectare will be separeted as logistics area. 700 m. dock-11000 TEU vessels can berth It will be the biggest container port of Turkey and one of the biggest top 10 container ports of the world. It will create employment for 15.000 people. It will bring approximately 700 billion TL /year.