Freight

Sustainable distribution

31.    The UK freight industry is heavily dependent on road transport. However, increasing congestion and growing environmental concerns are imposing rising costs upon industry and society, so there is a need to develop a more sustainable distribution strategy. In the longer term an essential task is to transfer some freight to other modes but logistics operators are unlikely to use costly and inflexible rail and waterway networks unless they are integrated intelligently and efficiently. This requires the development of advanced intermodal freight chains and logistics technology throughout Europe.

32.    In a European context, the particular challenges for freight are our island nature, physically separated from and at the periphery of our major European trading partners, the regional concentration in the south-east with the resulting transport bottleneck, and our favourable location as a gateway to and from the Americas.

Road freight

33.    Most freight is transported by road and this share is increasing. Road transport offers the most flexible, rapid, cheapest, and in many cases most efficient service for door-to-door deliveries. 65% of total tonne km^[14] and 80% of domestic freight tonnage goes by road^[16] . The number of trips has increased by 38% in the last decade^[17] and this trend is likely to continue with rising GDP. The 1997 National Road Traffic Forecasts^[9] foresee the number of Light Goods Vehicles doubling by 2031 and HGVs growing by 169% (central forecasts). This assumes a further increase in the share of freight transported by road.

Just-in-time

34.    Growth in freight transport has resulted from increases in the physical quantities of goods produced and consumed; increases in the number of links in the supply chain; and increases in the lengths of these links. New patterns of freight transport have emerged, such as long hauls serving the whole of Britain, and "just-in-time" (JIT) logistics which involve precise planning of deliveries to match production or sales needs.

Weight and size

35.    Overloading and standardisation are two important problems with regard to truck weights and dimensions. Overloading can damage handling equipment and infrastructure. The lack of standardisation and scale problems are particularly acute for container transport. Vehicle weights are not thought likely to increase much beyond present plans (perhaps 60 tons on 6 axles)^[18], although road trains comprising two articulated trailers coupled together, like those currently operated in Sweden, might be permitted by 2020. Vehicles will get taller though, particularly as a result of double deck vehicles.

Air freight

36.    Air freight (imports and exports) has grown rapidly over the 1990s. Tonnage carried by air grew by about 7 per cent a year over that period. Increasing use of international just-in-time delivery techniques, particularly in high tech growth sectors of the economy, suggests that demand may continue to grow at a similar level. There are indications that the proportion of freight carried in dedicated all-cargo flights may increase very rapidly - partly due to growth in the small package/express sector, led by major consolidators such as FedEx, UPS and DHL.

Water-borne freight

37.    Freight distribution by water accounts for 23% of total tonne km, and 95% of all export trade by weight is carried by sea^[14]. Inland waterways carry less than 1% of domestic freight moved at present, but there may be potential to divert about 3.5% of the UK’s road freight to rivers and canals^[19]. According to estimates by the World Bank and others^[20], expansion of world sea-borne trade is expected at the rate of 4% a year over the next decade, almost doubling current volumes by the year 2010. The UK is well positioned to share in this world-wide trade growth.

Rail freight

40.    Freight distribution by rail accounts for 7% of total tonne km^[14] .  A significant (80%) growth in rail freight is planned in the next ten years taking its market share to 10%. Although there will always be many distribution tasks for which road transport is the only alternative, more freight could be moved by rail, particularly over longer distances, with less damage to the environment. Integration of the road network with intermodal rail facilities is necessary to achieve a significant switch of freight from road to rail.

Intermodality

42.    In order to cope with growing transport flows, environmental concerns and for reasons of overall efficiency, intermodal freight operations are being advocated throughout Europe and the USA. However, in order to improve its competitiveness, intermodal transport needs to match the service standards of road freight. Thus, freight transport must be considered as a door-to-door operation based on a range of viable transport alternatives - roads, railways, inland waterways, seaports and major airports - with the nodes and links interconnecting them. Given that the UK is an island, interchange facilities at ports and airports are particularly crucial.

Freight interchange

43.    Efficient freight interchanges are an essential component of any intermodal transport concept. The management of pre- and end-haulage is a major bottleneck in using intermodal transport, especially for smaller companies. ICT and international standards are prerequisites for achieving intermodal transport, but not all partners share the same interests. The lack of standardisation and scale problems are particularly acute for container transport.

Logistics

44.    ‘Seamless’ logistics solutions providing improved reliability and cost-effectiveness are being sought the world over, but in Europe the need for such integrated ‘borderless’ systems is particularly pressing, with Europe increasingly being seen as one market. Increasingly "logistics" are being applied to the whole supply chain in order to improve efficiency across all modes.