Abstract
The cargo fare class mix (CFCM) problem aims to find the optimal fare class mix for a given intermodal transportation network based on known client demands. It is based on a revenue management problem for aviation passengers, the fare class mix problem, but considering intermodal cargo transportation, two major differences apply. Firstly, the CFCM’s premise is that long-term commitments to customers must be provided, such that a customer has a guaranteed daily capacity. Secondly, cargo may be rescheduled or rerouted, as long as the customer’s delivery due date is met. Our goal is to balance revenue maximisation and capacity utilisation by optimally combining two delivery service levels. Therefore, the optimisation problem is to select fare class limits at a tactical level up to which transportation demand will be accepted on a daily basis at the operational level. Any accepted demand that does not fit on the available network capacity during operation, must be transported by truck at increased expenses for the network operator. In this paper, we propose a faster method than the previously proposed solution method for a single corridor network and we provide proofs for the optimality of the result. Using this, we extend the problem to an intermodal network of multiple corridors. We provide numerical results for different settings, in which we compare the baseline of individual corridor optimums with the result of using rerouting. Finally, we apply the methods in a case study for an intermodal transportation network in North-West Europe.
Highlights
In traditional intermodal container networks in practice, customers usually have strict requirements regarding route, mode and time of a container transport, by which the transportation planning problem is restricted
This must be done within the time limits of the product agreed upon with the customer; the number of fare classes p is the third dimension. We use these dimensions to classify the problem type of the cargo fare class mix (CFCM) problem as CFCM (r, d, p). This problem was introduced in Van Riessen et al (2017) as the Cargo Fare Class Mix (CFCM) problem, in which we studied a simplified version of this problem, considering only one corridor
With the introduction of the Cargo Fare Class Mix problem, we aimed to create a bridge between the operations management of optimising transportation planning and the revenue management of optimising the service portfolio in synchromodal container networks
Summary
In traditional intermodal container networks in practice, customers usually have strict requirements regarding route, mode and time of a container transport, by which the transportation planning problem is restricted. These types of restrictions are generally ignored in literature. The goal was to maximise revenue for the transporter, by finding the optimal balance between two fare classes, with a higher priced Express service yielding a higher revenue but fewer planning options for the transporter and a lower priced Standard service that gives more planning flexibility. The goal of this paper is to extend that approach to network cases with multiple intermodal corridors, and to consider rerouting options. Including the possibility of rerouting increases the flexibility options to the transporter, potentially changing the optimal balance of both offered services
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