Growth in Intermodal Transportation at Ports, Case Study Example

Although the future of transportation at ports is trending towards larger, more advanced hubs, there is still a need for older ports such as the one in Philadelphia and Baltimore. Although these ports have limited real-estate available for expansion, the existing business practices and equipment that these sites have make them financially feasible for use. A major advantage of these sites are that they are historically relevant and consumers are aware of their presence and trust their reliability. Ultimately, newer facilities cost more money, which is necessary for them to achieve a better return-on-investment. In many situations, businesses prefer to partner with the transportation companies that will deliver the best service for the best price, and many older ports are able to accomplish this.

According to chapter 7, “The development of mainports will be highly influenced by the trends in global container logistics and the future demands of shippers, which continuously monitor the service levels and cost-effectiveness of their world-wide supply chain”. Although many ports are expected to upgrade to accommodate for size of shipments, it is important to consider that the formation of mergers and alliances will continue to be relevant. Thus, even though the industry is trending towards to expansion, this expansion will likely include older ports such as Baltimore and Philadelphia. Since this infrastructure already exists, it will be easier for partnerships to form between these existing ports and other, newer ports. These ports are also desirable because they are placed in key locations. Therefore, even if they are unable to serve all of the functions that newer, upgraded port may be able to, they can act as an intermediary between larger ports. Based on the location of delivery, this could help companies cut transportation costs.

An additional argument for the continued relevance of older ports is that the transportation business will continue to expand. Although there is currently a need to upgrade ports to accommodate a larger degree of cargo, this trend is expected to continue in the future. Therefore, it is essential to take advantage of all of the port space that is currently available, even if this space is small. In addition, the development of satellite terminals to contribute to the better utilization of mainport facilities is unavoidable. Thus, rather than building a new port, which is costly, older ports can be utilized for this purpose. In order to save expenses, it is essential for the transportation industry to consider how it can best work with the infrastructure that is already in place.

Although container ports are expanding in order to accommodate a greater degree of cargo, it is necessary to consider that an alternative to increasing the size of the real-estate would be to increase the speed of the shipment process. If older ports are able to optimize import and export of products that arrive at the port, they will be able to continue to be relevant and compete with newer modernized ports. Ultimately, the efficiency of a port is not limited by its size, but rather by its organization. The Agile Port System is a method that should be taken advantage of for this purpose.

The Agile Port System is designed to “handle as many containers as possible between vessels and trains without storing them in the EMT”, “transport containers immediately between EMT and IIC by train”, “sort containers between trains according to their ?nal destination”, and “load and unload trucks which serve the region nearby, inland at theIIC”. This technology is extremely beneficial because it will allow ports to quickly sort and deliver their cargo to the appropriate destination. Although larger ports can take advantage of this process as well, it is likely that they will have to perform many more of these jobs at once, which will require quality assurance to prevent cargo from being delivered to the wrong location. On the other hand, smaller ports will be able to focus on this process more carefully, and they will therefore be able to satisfy a greater number of customers by getting the orders correct each time.

Furthermore, smaller ports can compete by optimizing the Agile Port System in a manner that works best for them. The Philadelphia and Baltimore locations are fortunate because there are many cargo trains located nearby, and there is little need to improve upon the infrastructure. Therefore, the ports simply need to coordinate train times more efficiently so that the cargo can be quickly loaded onto the trains and delivered to the customer. Additional ways that the smaller ports can compete are by optimizing crate packing to ensure that the greatest amount of product is contained within each crate, so that a greater quantity of materials are delivered in a quicker time. In conclusion, smaller and older ports such as those in Baltimore and Philadelphia will continue to be relevant and compete with modern ports. Ultimately, business as these ports are more cost effective due to the existing infrastructure. Transportation companies can take advantage of this by partnering with these institutions. The physical land that was once used as a fully functional port can be used as a satellite port instead, which may be more cost effective for certain transportation routes. Lastly, the Agile Port System can be utilized to efficiently and quickly transport items from the port to the customer.

Reference

Priemus H, Nijkamp P, Konings R. (2008). The Future of Intermodal Freight Transport: Operations, Design and Policy. Edward Elgar Pub.