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Transportation Logistics

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Answer 50 questions in 15 minutes.
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Match each statement with the correct term.
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1. Terms of Payment
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
Special Rates
anywhere between a quarter and a third of all highway travel

2. Land Bridge Services
Intermodal in character
Terminal
Maximize the operational time of equipment - fuel efficient speeds - vahicle weight should be minimized - standardized equipment - equipment should be adapted to special market and commodity requirements.
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads

3. Unit trains
Yes
Move 1 single commodity and are non-stop to destination.
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
7%

4. What are the major causes of general traffic congestions?
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
1850-1950
Covered Hopper

5. What are the reasons for the relative decline of the US railroads after World War 2?
Transfer of function to another country - can stay within the same company!
Over reliance on costs - slow reaction to market changes - ignoring marketing mix - prices not tailored to services and markets - need to price according to strategic plan.
The trends in supply chain management called for faster and more frequent services and smaller inventories - so many shippers preferred trucks - - The newly built system of inland waterways swayed cost-conscious shippers to less expensive barge tran
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M

6. Which US federal government agency enforces safety regulations for railroads?
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion
Federal Railroad Administration (FRA)
Not the government - the railroads themselves

7. UNCTAD liner code 40-40-20
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
40% each to trade partners & 20% to 3rd world country to develop 3rd world ocean shipping industry - it happened to be inefficient.
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook

8. Funding the railroads?
Not the government - the railroads themselves
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination
Large carrying capacity - versatility of cargo - reduced pollution due to higher fuel efficiency compared to trucking - coast-to-coast 'land bridge' with shorter total transit sea+land times for prevailing import container routes

9. Major commodities hauled by each mode
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track

10. Types and shares of cost in railroads
Fixed Costs: 30% - Semi-Variable Costs: 40% - Variable Costs: Labor and Gas
Consolidation of shipments to different destinations within the same general area.
Class 1 - Regional - Shortline - Switching and Terminal
The trends in supply chain management called for faster and more frequent services and smaller inventories - so many shippers preferred trucks - - The newly built system of inland waterways swayed cost-conscious shippers to less expensive barge tran

11. What are the current trends in the US railroad?
Increased use of technology - Shorter length of haul - Growth of intermodal - Expected increase in rates due to expected capacity shortage - Convergence of LTL market with traditional integrators - Expanded menu of services - Active government lobbyi
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Coal
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes

12. Far-shoring
30%
Market Forces (customers) - Governmental Controls - Other channel member - Competition.
Completely different continent - different time zones.
Coal - farm products - chemicals - transportation equipment

13. What are the LTL carriers?
FedEx - YRC - Conway - UPS - ABF
Is likely to stay and even get worse in the future
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
Water

14. Service competition areas in airline industry
Carloads and Ton-miles
Covered Hopper
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.

15. What is the empirical formula of the typical coal unit train in the US?
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
90-s
100 cars x 100 tons
High price for price insensitive customers.

16. Starting from which cargo weight and movement distance does it normally make sense to ship by rail?
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
FedEx - YRC - Conway - UPS - ABF
30 - 000 lbs and 300 miles
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.

17. What aspects of the trucking industry is the US involved in?
7
About 2 cents per dollar
Amtrak is a US government business since 1971 - created to ease the burden on private railroads by taking over money-locing passenger transportation in exchange for the right to operate Amtrak trains over their networks
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks

18. Social Responsibility pricing
Society and customer first.
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
To save the railroads by giving them a chance to compete with other modes on equal footing
One method moves the trailer on its wheels while the other moves the container

19. Freight Revenue for Rail (per ton-mile)
About 2 cents per dollar
Transfer of function to another country - can stay within the same company!
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
Is likely to stay and even get worse in the future

20. Although the Interstate Highway System accounts for about 1% of total public road mileage - it carries...
83.8%
Large carrying capacity - versatility of cargo - reduced pollution due to higher fuel efficiency compared to trucking - coast-to-coast 'land bridge' with shorter total transit sea+land times for prevailing import container routes
anywhere between a quarter and a third of all highway travel
The number of unions and the degree of their involvement in operations and labor management contributes to inefficiencies of the railroads

21. Pricing adjustment conditions
ton-miles
Water
Main penalty is the cost of lost of sales by holding the shipment.
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.

22. What were the reasons for the erosion of the railroad dominance in transportation in the US?

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23. Highway weight limitation
58
80 - 000 lbs
ton-miles
Substantially higher

24. Private Carrier
A trucking operation that only hauls freight for the firm which owns it
Break bulk - Relay - Pick up - Delivery
The competition is intense in both TL and LTL segments
Consolidate orders for several customers and stop along the way for partial unloading.

25. What was the golden age of railroads?
Water
Voyage: Time - Bareboat or demise Voyage: Similar to taxi - ship owner - responsibility for crews & operation Time: Rent Vessel & crew for period of time Bareboat/Demise: Long period - chartering party responsibility for crews & operation
To promote interstate commerce and strengthen the defenses of the country
1850-1950

26. How are airport hub/spoke and LTL breakbulk similar?
Move 1 single commodity and are non-stop to destination.
With both - there are intermediary stops in between a route that serve as loading/consolidating or unloading of passengers/goods and then they are moved on to their final destinations.
Break bulk - Relay - Pick up - Delivery
Specialized: $73 Billion - General: $146 Billion

27. What are the current trends in trucking?
Seller asks buyer for l/c - buyer asks its bank to issue l/c - after approving buyer's credit line - buyer's bank notifies seller's bank it has issued l/c - seller's bank either adds confirmation or simply advises seller that l/c has been issued
Sysco - Tyson Foods - Coca-Cola - and Walmart
Maximize the operational time of equipment - fuel efficient speeds - vahicle weight should be minimized - standardized equipment - equipment should be adapted to special market and commodity requirements.
Increased use of technology - Shorter length of haul - Growth of intermodal - Expected increase in rates due to expected capacity shortage - Convergence of LTL market with traditional integrators - Expanded menu of services - Active government lobbyi

28. Consular Invoice

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29. Where does funding for the roads come from?
About 2 cents per dollar
1850-1950
Highway user taxes
anywhere between a quarter and a third of all highway travel

30. Factors contributing to the decline of Railroad use
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
Pricing according to product value or demand - higher value of the product - the higher the transportation price (risk of loss/damage..). Third Degree price discrimination: separate price for separate groups of buyers with same service. Must posses
To save the railroads by giving them a chance to compete with other modes on equal footing
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit

31. The current share of railroads in total transportation expenses is closest to...
15
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Continuous straight line movement - minimize intermediate handlings - maximize the full capacity of equipment - consolidation and break-bulk activities - empty mileage should be minimized - movement should be scheduled and dispatched.
7%

32. What companies are players in private carriage?
Intermodal in character
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
Sysco - Tyson Foods - Coca-Cola - and Walmart
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%

33. Dock receipt
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Carloads and Ton-miles
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment
Transfers accountability between domestic and international carrier at the terminal

34. Bill of Lading
Used for tax - manning - and relaxed regulation.
A contract for transportation between a shipper and the carrier - also is a cargo receipt
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
250 - 000

35. Cost of Service Pricing
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.
Society and customer first.
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative

36. What are the metrics to measure freight traffic in the motor carrier industry?
Line-Haul Vehicles: Tractor Trailer combination of 3 or more axles - City Straight Vehicles: Single Units - Special Vehicles: Dry Van - Open Top - Flatbed - Tank Trailer - Special
1850-1950
ton-miles
A contract for transportation between a shipper and the carrier - also is a cargo receipt

37. What are the generally accepted classifications of railroads?
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%
80 - 000 lbs
Class 1 - Regional - Shortline - Switching and Terminal
Is likely to stay and even get worse in the future

38. Consolidation
Highway user taxes
Main penalty is the cost of lost of sales by holding the shipment.
Line-Haul Vehicles: Tractor Trailer combination of 3 or more axles - City Straight Vehicles: Single Units - Special Vehicles: Dry Van - Open Top - Flatbed - Tank Trailer - Special
1850-1950

39. Which economies are most prominent in the trucking industry?
High price for price insensitive customers.
Economies of scope and density
A longer combination vehicle towing more than one trailer
Carloads and Ton-miles

40. FOB Origin/Destination
Break bulk - Relay - Pick up - Delivery
Free on Board- Origin (seller pays shipping costs); Destination (Buyer pays).
A contract for transportation between a shipper and the carrier - also is a cargo receipt
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion

41. Which economies are present in the US railroad industry?
To promote interstate commerce and strengthen the defenses of the country
A longer combination vehicle towing more than one trailer
Economies of scale
Break bulk - Relay - Pick up - Delivery

42. Which phrase best characterizes the level of competition in the motor carrier industry?
Amtrak is a US government business since 1971 - created to ease the burden on private railroads by taking over money-locing passenger transportation in exchange for the right to operate Amtrak trains over their networks
The competition is intense in both TL and LTL segments
Attests to authenticity and accuracy of the goods. Performs by third party independent company
7

43. Class Rate Calculations
Specialized: $73 Billion - General: $146 Billion
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Pricing according to product value or demand - higher value of the product - the higher the transportation price (risk of loss/damage..). Third Degree price discrimination: separate price for separate groups of buyers with same service. Must posses
Provides rate for any commodity between any two points 1) Geogrphic: rate basis points and numbers 2) Commodity: commodity classification - class ratings 3) Rate structure: national scale of rates - cwt-based.

44. What do the users of truck service benefit?
FedEx - YRC - Conway - UPS - ABF
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
High price for price insensitive customers.
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%

45. A pumping station requires 3-6000HP to move oil through a pipeline. To move more than 1 grade at same time what do you use?
Completely different continent - different time zones.
A batching pig
Seller asks buyer for l/c - buyer asks its bank to issue l/c - after approving buyer's credit line - buyer's bank notifies seller's bank it has issued l/c - seller's bank either adds confirmation or simply advises seller that l/c has been issued
Intermodal in character

46. Freight Revenue for Truck/Motor (per ton-mile)
Consolidate orders for several customers and stop along the way for partial unloading.
About 25 cents per dollar
Air
Gov't aid to develop air service - Gov't funding of highways - Construction of inland waterways - Growing preference of shippers for more frequent deliveries and smaller shipments

47. The whole history of the US railroads is a history of...
Federal Railroad Administration (FRA)
Declaration of where product was made so that appropriate duties are charged
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
Consolidation

48. Commercial Invoice
Consolidation of shipments to different destinations within the same general area.
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
Accompanies shipment - Bill for the goods from the seller to the buyer - Often used by government to determine the true value of goods when assessing customs duties
Carloads and Ton-miles

49. How many Class 1 freight railroads are there?
Wyoming
Economies of scope and density
7
484

50. Micro Bridge
1. Setting prices on new services- consider cost and market elasticity; no precedent 2. Modification of prices over time- respond to market/operating/service changes 3. Initiating and responding to price changes- impact on market share and profits.
An agreement whereby one railroad pays a second carrier to transport its freight using the second carrier's crew and power equipment
Interior Non-port cities
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives