The Velocity of Freight

The Velocity of Freight

The velocity of freight is more than merely the speed at which it moves along modes; the shipment speed (or modal speed). It also includes the transshipment speed, which concerns the effectiveness of intermodal operations. It leans on a synchronization between modes and terminals. Many transportation modes, particularly maritime and rail, have not shown any significant speed improvements in recent decades because of technical speed barriers. Intermodal operations have become one of the most important elements behind the increased velocity of freight. Containerization has been the fundamental factor behind such a radical change, as before containerization (A), the shipment speed may have been adequate but acute delays linked with inefficient transshipment prevented any forms of effective operational time management of freight distribution.

With containerization, the velocity of freight has reached a level (logistical speed threshold) where time-based management of distribution becomes practical, such as just-in-time and inventory-in-transit strategies (B). A level of reliability must also accompany this velocity in terms of schedule integrity. This enables a move from push (supply based) to pull (demand-based) logistics where most of the inventory can be kept in circulation, minimizing warehousing. It is very likely that any future improvements in the velocity of freight are dominantly going to be based on the transshipment dimension, both from an intermodal (between modes) and transmodal (within components of the same mode) perspective. Still, the velocity of freight is also being challenged by traffic growth, which may eventually lead to congestion either along transport segments or at terminals. This can have a negative impact on the velocity of freight and the effectiveness of the supply chains it supports.