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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. What are the current trends in the US railroad?
Wyoming
ton-miles
Increased use of technology - Gradual increase in the number of smaller railroads - Increase in intermodal shipments - Sharp growth in fuel efficiency of locomotives
Society and customer first.

2. Funding the railroads?
Break Bulk - Pickup and Delivery - Line Haul - Slip-Seating
Amenities/Accommodations - Direct flights to destination without layovers - More personal space in flight - In flight service personnel - No frills types of service (no perks)
Class 1 - Regional - Shortline - Switching and Terminal
Not the government - the railroads themselves

3. 20/80 Rule
anywhere between a quarter and a third of all highway travel
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
Water
Less than 25 carriers handle 75 to 80% of total freight dollar.

4. Certificate of Inspection
Economies of scope and density
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage
Attests to authenticity and accuracy of the goods. Performs by third party independent company
Covered Hopper

5. Four types of Liner Service
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).
Break bulk - Relay - Pick up - Delivery
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.
Moving a corporations internal activities to outside providers - mainly for cheap labor

6. Which mode has the highest carrying capacity?
Water
Reduced highway congestion - damage and pollution as a result of replacing trucks as an alternative
About 25 cents per dollar
Break bulk - Relay - Pick up - Delivery

7. What is the difference between class 1 and class 2 carriers?
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
Slip-Seating - Bob-Tailing - Hub-And-Spoke System - Drop-and-Hook
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement
1850-1950

8. What are the characteristics of a block train?
Used for tax - manning - and relaxed regulation.
Highway user taxes
After World War 2
Priority service schedule - often empty backhaul - often cars owned by the shipper - and direct movement from origin to destination

9. What is the approximate number of railroads in the US?
563
Sysco - Tyson Foods - Coca-Cola - and Walmart
Odd numbers: North to South highways - increase from west to east - Even numbers: East to West highways - increase from south to north
Service levels - Frequent flyer programs - Timing of flights - In advance registration

10. What companies are players in private carriage?
The development of the highway system - Limited access points - Long transit times - Safety of cargo during transit
Sysco - Tyson Foods - Coca-Cola - and Walmart
The competition is intense in both TL and LTL segments
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery

11. Which economies are present in the US railroad industry?
58
A pumping station
Wyoming
Economies of scale

12. _______ mode would be ideal for moving dry bulk - grains - petroleum - and certain manufactured products not prone to damage during transit
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
1850-1950
Water

13. Offshoring
Society and customer first.
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Transfer of function to another country - can stay within the same company!
7

14. Examples of general freight
83.8%
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks
Cargo can fit in an enclosed van trailer - Food - consumer staples - manufactured goods
Society and customer first.

15. Names of the Class 1 railroads?
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
Society and customer first.
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Highway user taxes

16. What are the metrics to measure freight traffic in the motor carrier industry?
Cash in advance - Letter of Credit - Documentary collection - Open account - TradeCard
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Coal
ton-miles

17. At about what time did trucking become the predominant mode of transportation in the US by gradually surpassing the railroads in terms of tonnage and revenues?
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement
After World War 2
An agreement whereby one railroad pays another for the right to operate its trains over the second carrier's track
484

18. Bill of Lading
A contract for transportation between a shipper and the carrier - also is a cargo receipt
Containers moving between Far East & Europe via ship - rail - ship instead of all water through Panama Canal - Use continent U.S. as bridge (move by train) - Save Transit time - fuel - & Liner ship investment
30%
Moderate

19. Ways to classify the motor carriers
Market Forces (customers) - Governmental Controls - Other channel member - Competition.
About 2 cents per dollar
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight
Economies of scope and density

20. What are the generally accepted classifications of railroads?
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%
Moving to neighboring country - NAFTA - because the places may have close cultural affinity.
Class 1 - Regional - Shortline - Switching and Terminal

21. Trackage

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22. Government is involved in which aspects of the railroad business?
Safety regulations - Evaluating fairness of disputed charged rates - Monitoring profitability of railroads - and Mergers and acquisitions
A batching pig
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
Class 1 - Regional - Shortline - Switching and Terminal

23. What is the approximate share of fixed costs of US railroads?
Completely different continent - different time zones.
30%
Bottlenecks - Traffic accidents - Major snowfalls - Projects to improve existing highways
Economies of scope and density

24. Consolidation
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
Main penalty is the cost of lost of sales by holding the shipment.
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
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.

25. Non-vessel operating common carriers (NVOCC)
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
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.
A batching pig
Act as a consolidator and domestic freight forwarder - inbound/outbound container arrangement

26. What commodity/goods are typically transported by railroads in the US?
Coal - farm products - chemicals - transportation equipment
Crushed stone - gravel and sand
Alcoholism in the workplace - Challenges of implementing new technology - Need to increase customer service - Challenges of growing intermodal service
Terminal

27. What term is related to railroad operations?
563
Declaration of where product was made so that appropriate duties are charged
Class 1 - Regional - Shortline - Switching and Terminal
Switching - Piggybacking - Double-Stacking - Car-Loading - Trackage - Haulage - Drayage - Demurrage

28. It is common for an operating ratio of motor carriers to be around these numbers...
90-s
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
Pricing according to cost incurred to serve - Customer covers all costs - seller sets prices to maximize profits.
Federal Railroad Administration (FRA)

29. Freight Revenue for Truck/Motor (per ton-mile)
Showed a marked decline
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
About 25 cents per dollar
Consolidation

30. Third Party Logistics
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C
Connect buyer and seller- Use of outside firms (outsourcing) to provide own logistics support. Firms: Info-based... freight bill payment - auditing. Asset and operation-based: in/outbound transportation - warehousing...
anywhere between a quarter and a third of all highway travel

31. Price variation factors in airline service
Economies of scale
Service levels - Frequent flyer programs - Timing of flights - In advance registration
Containers moving between Far East & Europe via ship - rail - ship instead of all water through Panama Canal - Use continent U.S. as bridge (move by train) - Save Transit time - fuel - & Liner ship investment
Water

32. What is the current share of trucking in total transportation expenses is closest to...
83.8%
Break bulk - Relay - Pick up - Delivery
(Trucking) Class 1: income > $10M - Class 2: $3M<income<$10M
Truck safety requirements - Driver hours of service - User fee charges - Reduction of pollution from trucks

33. What are the revenues of the specialized and general cargo?
Accessibility - Speed - Universal Connector - Reliability - Frequency - Lower Loss and Damage Rates - Lower Inventory levels due to smaller shipments than other modes
Specialized: $73 Billion - General: $146 Billion
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.
Is likely to stay and even get worse in the future

34. What was the rationale behind passing the Staggers Act of 1980?
Boxcar - Hopper Car - Covered Hopper - Flatcar - Gondola - Tank Car
15%~13%
Completely different continent - different time zones.
To save the railroads by giving them a chance to compete with other modes on equal footing

35. What was the golden age of railroads?
1850-1950
Break bulk - Container service - LASH service (lighter aboard ship) - RORO service (roll on/off ship).
Terminal
Sysco - Tyson Foods - Coca-Cola - and Walmart

36. 1. Character of shipment rates: LTL/TL rates - multiple-car rates - incentive rates - unit train rates - density rates... 2. Area - location or route rates: Local rates - joint rates - proportional rates - differential rates - per mile rate.
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
Special Rates
Commercial invoice printed on stationery of importing country's consulate and stamped by consulate.
Break bulk - Relay - Pick up - Delivery

37. What could be the rationale for railroad mergers?

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38. Core Carrier concept
30 - 000 lbs and 300 miles
Few carriers handle more than 25% of total shipment - service disruptions problems if cease operation.
Air carrier: highest at 80.4% - Truck: 26.6% - Rail:2.24% - Barge Ship: .72% - Oil Pipeline: 1.47%
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

39. Did the US railroads have anything to do with the creation of world time zones?
Special Rates
Carloads and Ton-miles
Crushed stone - gravel and sand
Yes

40. Which phrase best characterizes the level of competition in the motor carrier industry?
The competition is intense in both TL and LTL segments
Terminal
Water (Barge Ships) at 0.72 per ton mile. The second lowest is Rail at 2.24 cents per ton mile.
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.

41. How to assess the operating ratio?
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
30%
The closer the operating ratio is to 100 - the more indicative of the possible need to raise rates to increase total revenues
LTL vs TL - Local vs Intercity Carriers - Publicly owned vs Privately owned - Specialized vs general freight

42. Drayage
250 - 000
One method moves the trailer on its wheels while the other moves the container
Less than 25 carriers handle 75 to 80% of total freight dollar.
The pickup and delivery of trailers and containers in conjunction with a line-haul rail movement

43. Pricing adjustment conditions
Discounts: reduction from published price. Volume: TL vs LTL - Seasonal - Cash 2/10 net 30 - Geographical- FOB origin/destination - Uniform delivered pricing: zone pricing.
15%~13%
Motor: HH Goods - Heavy Machinery - Petroleum Products - Dump Trucking - Ag Commodities - Motor Vehicles - Retail Store Delivery
Coal - farm products - chemicals - transportation equipment

44. What is a road train?
Moderate
A longer combination vehicle towing more than one trailer
58
Not an invoice but a quote. must be carefully written to avoid discrepancies w/ L of C

45. Land Bridge
83.8%
Highway user taxes
Containers moving between Far East & Europe via ship - rail - ship instead of all water through Panama Canal - Use continent U.S. as bridge (move by train) - Save Transit time - fuel - & Liner ship investment
1500 tons

46. What are the LTL carriers?
FedEx - YRC - Conway - UPS - ABF
Consolidation of shipments to different destinations within the same general area.
Wyoming
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.

47. Outsourcing
Motor/Truck - around 69-70% - Revenue % for Rail: 5.6%
Moving a corporations internal activities to outside providers - mainly for cheap labor
BNSF - CSX Transportation - Kansas City Southern Railway - Grand Truck Corporation - Norfolk Southern - Union Pacific Railroad - Soo Line Railroad
80 - 000 lbs

48. Haulage

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49. Freight Revenue for Rail (per ton-mile)
Use of low-sulfur diesel fuel - Use of biodiesel fuel - Cutting down on idling - Reducing traffic congestion
7
About 2 cents per dollar
100 tons

50. Types of vehicles for trucking
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
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
Attests to authenticity and accuracy of the goods. Performs by third party independent company
One method moves the trailer on its wheels while the other moves the container