SCM 410 - Week 10 Multiple Choice

Right-of-Way?

• In this context refers to the infrastructure or pathway (roads, rail tracks, air corridors) that carriers’ equipment (trucks, trains, aircraft) uses to move freight.

Drayage?

• Refers to short-distance movement of freight, typically by truck, used to transport goods, to or from an intermodal hub (e.g., airport, ocean port, or rail terminal).

While drayage connect modes, the movement itself is not classified as intermodal transportation because?

• The motor carrier is only performing a local pickup or delivery, not participating in a full multi-modal route.

Intermodal Transportation?

• Movement of goods using two or more different modes of transportation, without handling the cargo when changing modes. Each mode has a separate contract with carriers (vs multi-modal).

Land Bridge?

• Refers to a freight movement strategy in which cargo is transported across a large landmass (typically by rail or truck) to connect two ocean ports on opposite coasts.

Intermodal ISO Containers - Containerized Freight?

• Loaded in/on storage equipment (e.g., container or pallet) at the origin and delivered to the destination via that equipment without additional handling.

(**) Bill of Landing: Sets Terms of Shipment; Document of Title?

• Provides all information the carrier needs for the move.

• Stipulates the transportation contract terms (i.e., liability).

• Acts as receipt for goods the shipper tenders to the carrier.

• In some cases, specifies the certificate of title to the goods.

  • Lecture notes:🎶

    • No dollar sign on the bill of lading

    • if $, invoice

Freight Bill?

• The carrier’s invoice for fees charged to move the shipment – this document reports the shipment, origin and destination, consignee, items, total weight, and overall charges (based on negotiated rate).

Claims Form?

• Transportation buyer files this document with the modal carrier to recoup monetary loss. Carrier liability is limited if goods are sent under a released value (i.e., undervaluing freight for lower rates).

Motor/Trucking Industry?

• The trucking industry is highly competitive. During 2024, there were approximately 777,240 for-hire motor/trucking carriers operating in the U.S. (11.46 billion tons of freight).

Low-Fixed, High-Variable Cost Industry?

• Majority of the costs relate to amount of freight hauled or miles driven.

• No significant entry barriers; reasonable start-up costs.

Motor Carrier Options - Truckload Carriers (TL)?

• Trailer Full Cubic Capacity.

Motor Carrier Options - Less-Than-Truckload (LTL)?

• Hub-and-Spoke Network.

Rail Industry?

• Industry is labeled “Natural Monopoly”. In ton-miles (i.e., cargo weight multiplied by distance traveled), rail moved 25% of all US freight in 2024 (≈ 1.5 billion tons of cargo).

High-Fixed, Low-Variable Cost Industry?

• Railroads own and maintain their tracks, bridges, tunnels, yards, and signals. Also responsible for their locomotives, railcars, terminals/depots, and railyards. Labor and fuel fluctuate.

Class I annual operating revenue?

• ≥ $1.034 Billion (Seven Operating within US)