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A concise introduction to Road Transport Presented by Dr. F. Saruchera
Learning Objectives:
After this session, the student should be acquainted with basic regulations of road transport.
S/he should be in a position to state the commonly used vehicles to give information on transport
documents for road movements. Furthermore s/he should explain the e c o n o m i c tariff
structure and give examples and how to offer to customers.
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What is Road Transport?
Who are the main Players in Road Transport?
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Why road transport?
This is what the International Road Transport Union (IRU) says … “The road transport industry is:
• … the backbone of strong economies and dynamic societies
• … vital to economic growth, social development [and] prosperity and, meeting the demand for the sustainable mobility of both people and goods. (…)
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• … instrumental in interconnecting all businesses to all major world markets (…)
• … crucial [for] the daily economic and social life of industrialised and developing countries alike (…).“
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The Transporter’s role in road transport
The transporters / transport managers are actively involved in organizing cargo transports by road; it is the core activity.
They: * select the trucks appropriate for the specific type
of cargo, * decide on the actual carrier with regard to his
reliability,
* propose or indicate the transport routes
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(regarding time and costs),
* mediate and conclude transport contracts,
* give instructions to carriers,
* execute instructions by consignor with regard to insurance, packaging, warehousing a. s. o.,
* (sometimes) perform transports as own‐name transactions (acting as carrier).
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Road Transport Management ‐ some key considerations
* capacity: truck’s gross capacity ranges from 3,5 tons (short haul / city trucks) to 40 tons (long distance trucks) with a net capacity from about 1 ton to 25 tons
* (special trucks / heavy load trucks my exceed this limit)
* distance: basically trucks can reach any place in the world from any place in the world, it’s just a matter of costs and time
* costs: relatively high investment for (new) trucks, high
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fixed costs (depreciation, drivers), variable costs, such as fuel,
often volatile
* speed: some countries have speed limits for trucks, average speed relatively low (e. g. a maxi‐ mum of 80 km/h on highways, with an average speed of about 60 - 65 km/h)
* safety: medium, lots of truck accidents, quite often cargo is
damaged while loading or unloading
* environment: the carbon‐footprint of trucks is not very favorable, efforts to improve it are under way
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Licencing
National licencing: Types of licence
* standard national licence … entitles the holder to carry goods for hire or reward on national operations and to carry your own goods abroad. This will allow you to haul loaded trailers to or from ports
* Regional licencing - e.g. SADC, SACU etc
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*International licencing
e.g. EU Community Authorisation Community Authorisation allows drivers to use a single permit for trips between all EC member states. The Authori‐ sation also allows transit traffic through EC member states and to and from non‐member countries. It also allows cabo‐ tage, i. e. journeys entirely within one other EC member state. (http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1081804820&type=RESOURCES)
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International licencing (cont’d)
Mutual licencing between two countries (bi‐lateral licences)
Usually negotiated between countries mutually granting a certain amount of transports per annum for road hauliers of both countries.
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Preconditions for licensing These apply to basically all types of licences:
* good financial standing
* professional) fitness and repute
* appropriate operating centres
* no criminal offences (certificate of good conduct issued by police)
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Contracts of Carriage in road transport ‐ 1
Contracts of Carriage in road transport basically show the same structure as in any transport business relationship:
* shipper >> CC >> carrier – consignee
• i. e. direct shipments without integration of forwarder • consignee no direct contracting partner, just benefitting • exception: ex works / fca / fob delivery – consignee
paying for main leg of transport >>> right of choosing carrier
CC = Contract of Carriage
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Contracts of Carriage in road transport ‐ 2
* Full shipments, just mediated by forwarder:
shipper >> FC >> forwarder – (>> shipper CC with >>) carrier – consignee
* i. e. typical forwarder’s activity: * just mediating, organizing * no involvement in actual transportation
FC = forwarding contract / CC = contract of carriage
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Contracts of Carriage in road transport ‐ 3
* Full or part shipments with forwarder contracting the carrier:
shipper >> FC >> forwarder >> CC >> carrier – consignee
* Groupage services organized by forwarder:
(several) shippers >> FC >> consolidating (groupage) forwarder >> CC >> (actual) carrier– receiving forwarder – (several) consignees
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Contents to be considered in individually agreed contracts
* definition of services to be covered by contract
* issuing of consignment note and/or additional transport related documents
* type of truck to be provided by carrier
* type of cargo to be transported (esp. if dangerous goods)
* number of items and packaging
* load units and/or loading devices to be provided by carrier * time and place of actual provision of truck
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* loading deadlines
* loading regulations & responsibilities
* hindrances and related measures
* special customs related instructions in case of cross‐border transport
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* prohibition or allowance of transport on open loading platform
* agreement on freight costs and payment
* special conditions in case of intermodal transport
* liability (both sides)
* place of jurisdiction, severability clause (list does not claim completeness of all contract details)
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The Carrier’s promise
The carrier promises to transport and deliver the goods in apparent good order and condition to the named destination and consignee,
The Shipper’s promise
while the shipper promises to hand over the goods properly marked and numbered ready for carriage and pay the agreed price for the transport.
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Legal basis of contracts
Laws and regulations * applicable national transport law * applicable international law for road transports
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Documents in Road Transport
*consignment note
* optional in some countries (nevertheless advisable for purpose of proof)
* mandatory for international transports
* function of consignment note basically the same as with
every other mode of transport
* packing list / loading manifest / bordereau in groupage services
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* customs documents ‐ export declaration ‐ documents for customs supervision
* commercial invoice, certificate of origin … * dangerous goods documentation (shippers declaration,
specific instructions)
* truck & drivers documents ‐ transport licence (copy) ‐ insurance (copy) ‐ driver’s licence & social security / I.D. card ‐ registration papers for truck
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The Economics of Road Transport
Cost calculation
* defining the “cost centres” (any part of the business against which costs are charged)
* defining the “cost units” (a specific item or an order against which costs can be charged.
Basic question: To which cost centre or cost unit can the costs in question be allocated directly?
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Direct costs
- a direct cost is one which is attributable directly to a cost centre (or in a narrow sense to a cost unit).
- Items such as fuel, oil, tyres, repairs and maintenance, wages, vehicle insurance and licence fees are typical of costs which can be allocated directly to a vehicle [fleet] cost centre.
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Indirect costs
- These are the costs which cannot be attributed directly to an operating cost centre.
- For example, advertising, heat and light, telephone and office salaries costs cannot be allocated specifically to vehicle operations.
- They have to be calculated and then spread out over the various departments on a fair and equitable basis.
- They are usually called "overheads".
Time‐related costs
- These costs remain the same no matter how much work the vehicle
does. Such costs are not affected by mileage or vehicle activity.
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For example, a vehicle standing in the depot still costs money. Consequently, many operators call these "standing costs“. Examples of these costs are drivers' employment costs, vehicle depreciation, licence, insurance, interest on capital and overheads, e.g.
• Drivers' employments costs
• Vehicle depreciation, or hire/lease costs
• Interest on capital
• Overheads.
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Distance‐related costs: these costs will vary in relation to the level of activity of the vehicle. They are often called "running costs", for example, fuel, tyres, repairs and maintenance. (Also called “variable costs”.)
- Distance‐related costs are calculated on a per kilometer basis.
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Pricing – 1
The total cost calculated for an order consist of the sum of per day costs multiplied by number of days invested in order plus costs per km/ m multiplied by kilomteres/miles driven. Be careful to include “empty” kilometres/miles in calculation in order to cover all costs of an order.
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Pricing – 2
However, in very competitive situations it is possible to go as low as the lower (lowest) price limit, which lies with the amount calculated with distance costs (variable gross margin).
But beware: pricing solely based on distance costs in the long run leads to disaster, always keep in mind the full (total) costs.
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Types of Trucks ‐ 1 Text: http://www.gti‐logistics.com/en/useful/trucks
http://static5.depositphotos.com/1005790/400/v/450/dep_4004912‐Truck‐trailer‐types.jpg
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Types of Trucks ‐ 2 Text: http://www.gti‐logistics.com/en/useful/trucks
Semi‐trailer (tent, tarpaulin) suitable for majority of types of cargoes, loading from sideway and above by removing the tent cover. Loading capacity: 20‐25 t. / Useable volume: 60‐92 cbm / Capacity: 22‐33 euro – pallets
http://www.boehler‐ spedition.de/leistung/sattelauflieger.jpg
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Types of Trucks ‐ 3 Text: http://www.gti‐logistics.com/en/useful/trucks
Tent "Jumbo" Tent semi‐trailer with bigger capacity; achieved by the “G” shape of the floor and reduce of diameter of the wheels. Loading capacity: to 20 t / Useful volume: 96‐125 cbm
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Types of Trucks ‐ 4 Text: http://www.gti‐logistics.com/en/useful/trucks
Truck‐trailer Tent vehicle + trailer. Fast loading/ unloading and larger useable loading volume. Not suitable for the transportation of long‐length cargoes. Loading capacity: 16‐25t / useable volume: 60‐ 120 cbm / Capacity: 22‐33 euro‐pallets
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Types of Trucks ‐ 5 Text: http://www.gti‐logistics.com/en/useful/trucks
Refrigerated truck/ frigo Refrigerated semi‐trailer (most perishable goods with special storage conditions: from +25 0C to ‐250C. Loading capacity: 12‐22 t / useable volume: 60‐92 cbm / capacity: 24‐33 euro –pallets / "European standard": 20 tons of 82 cbm. 32 pallets
http://www.peterfahrzeugbau.ch/media/Fa hrzeug‐Ablieferungen/2011/16510_01.jpg
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Types of Trucks ‐ 6 Text: http://www.gti‐logistics.com/en/useful/trucks
Flat Bed and Low Bed Trucks for the transportation of oversized cargoes It is applied for the transportation of over‐sized cargoes. Loading capacity: 20‐40 t
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Types of Trucks ‐ 7 Text: http://www.gti‐logistics.com/en/useful/trucks
Lorry Tank / Tankers It is applied for the transportation of food and non‐food liquid products. Loading capacity: 12‐20 t / Useful volume: 6‐40 cbm
http://www.nordtank‐spedition.de/typo3temp/pics/spezial‐tanksattelzug_42d8d001a5.jpg
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Types of Trucks ‐ 8 Text: http://www.gti‐logistics.com/en/useful/trucks
Timber Lorry It is applied for the transportation of forest and trunk products. Loading capacity: 10‐20 t
http://www.polizei.rlp.de/internet/nav/58e/binarywriterservlet?imgUid=f9024ae0‐752d‐e21c‐ 5ec3‐f110b42f27b4&uBasVariant=22222222‐2222‐2222‐2222‐222222222222
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Types of Trucks ‐ 9 Text : http://www.gti‐logistics.com/en/useful/trucks
Isotherm There can be a semi‐trailer, truck‐trailer and separate truck. Isotherm is intended for the transportation of food. It may keep a certain temperature for a long time. Loading capacity: 3‐ 25t / Useable volume: 32‐ 92 cbm / Capacity: 6‐33 euro‐pallets
http://www.gangloff.com/D/assets/plugindata/w2d blgd49fd5062f9e39170ff3ffbddda680e8/pic126812 6237.jpg
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Types of Trucks ‐ 10
Flat Bed Truck It is applied to the trans‐ portation of out‐of‐gauge goods and special transport needs. Loading capacity: 15‐25 t.
Picture next slide: Variations of flat‐bed trucks.
http://www.cover‐tech.com/Copy%20of%20index.3.jpg
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Types of Trucks ‐ 11 Text: http://www.gti‐logistics.com/en/useful/trucks
http://www.gwtrans.com/wp‐content/uploads/2012/03/flatbed‐truck.jpg
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e curtain
Types of Trucks ‐ 12
box trailer / dry freight transporter)
platform trailer with sliding sid
multi‐purpose chassis
swap body
(all Kögel pictures above: http://www.koegel‐trailer.com/en/products/forwarding‐industry.html)
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Types of Trucks ‐ 12
„Euro Trailer“
curtain‐sider
full tarpaulin (open)
(all Kögel pictures above: http://www.koegel‐trailer.com/en/products/forwarding‐industry.html)
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Out‐of‐gauge cargo ‐ 1
Out‐of‐gauge cargo is not the typical forwarding agents field of business. It may, nevertheless, occur occasionally.
For transports like these careful planning is necessary: * selecting the appropriate truck(s)
* selecting the appropriate auxiliary equipment
* selecting skilled and experienced staff
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Out‐of‐gauge cargo ‐ 2
* checking the route for obstacles (in advance!!)
* if necessary removing the obstacles, otherwise alternative routes for circumnavigating
* planning the transport time (night transport)
* to be escorted by police
* …
The following pictures show typical out‐of‐gauge cargo.
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Heavy duty trucks – a few examples from Goldhofer
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Heavy duty trucks – a few examples from Goldhofer, Germany
Parts for offshore‐installation ‐ http://www.goldhofer.de/gh‐de/
http://www.eppler‐cargo.de/_wp_generated/wp5a0e184b_0f.jpg
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Loading of trucks
* loading takes place either from the rear (standard), from side (removable tarpaulin, curtain sider) or from top (craneable cargo)
* typical loading devices are pallets and iron‐bar boxes * further loading means are
‐ handcart ‐ manual lift truck ‐ forklift truck
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Loading of trucks ‐ 2
* if possible loading should leave no space between each item (full utilization of loading space)
* since this is almost impossible, items have to be secured for transport
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Loading of trucks ‐ 3
* It is advisable to compile a loading and stowage plan in advance, so as to prevent time loss during actual
loading
* Time limits for loading have to be taken in account, especially when loading takes place at shipper’s premises (or ports, stations …)
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International customs transit documents
- Customs documents for cross border transports may vary from country to country, or – in case of EU –may show a common procedure and documentation.
- Widely accepted as a customs document in road transport is the Carnet TIR.
* TIR Carnet - a harmonised control document accepted by the Customs authorities of the countries of departure, transit and destination.
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Carnet‐TIR ‐ 1
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Regional scope of TIR Convention
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Key Principles of TIR The TIR system is an international Customs transit system for goods carried by road. It is based on 6 essential principles – the 5 pillars of the TIR system (see TIR 5 Pillars handout)
1* Secure vehicles or containers ‐ sealed vehicles or containers approved for use by Customs and re‐approved every two years.
2* International chain of guarantee - Duties and taxes due in case of irregularity are secured
by an international guarantee chain throughout the
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journey.
3* Mutual recognition of Customs controls - control measures taken in country of departure
accepted by countries of transit and destination. 4* Controlled access - access to the TIR system for transport operators, by the
national Customs authorities and the national Association. 5* SafeTIR - electronic control system for TIR Carnets (traceability, risk
management)
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The Actors in the TIR System are: * The International Organisation (The IRU) * The Government of the Contracting Party
(usually Customs Authorities) * The National Issuing and Guaranteeing Association * The authorized transport operator (TIR Carnet Holder) * The UN TIR bodies (TIR administrative committee, WP30, TIRExB,
UNECE TIR Secretariat)
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Dangerous Goods in road transport
Legal regulations * on a national level most countries provide laws and
regulations for the handling of dangerous goods * the hazardous nature, however, requires international
coordination, which is done by UN * most dangerous goods regulations refer to UN
nomenclature and classifications, so does the …
more detail to follow after appreciating DGs.
Dangerous goods transports
Dangerous goods aren’t fun. Negligence and – even worse – willful intent cause liability and culpability. Always act with care and responsibility.
Source picture: http://static.freepik.com/free‐ photo/character‐in‐radioactive‐material‐barrel_45‐7447.jpg
Questions?
