By Jeroen van Oekel
What’s the difference between roll-on, roll-off and container shipping?
If you answered, “One can efficiently transport cars and trucks far better than the other,” you’re not alone. Many companies still consider ro-ro to be the only truly viable option for shipping most of their vehicles.
But you’re also not 100 percent accurate.
In fact, as vehicle production footprints and purchase trends continue to evolve, evidence suggests there are several supply chain scenarios where vehicle container shipping deserves to be a bigger part of the logistics discussion — and quite possibly your supply chain equation; the advantages it offers might surprise you.
Consider, for example, what happens when you want to ship to markets that are smaller-volume, niche, or more remote. Ro-ro carriers excel at supplying large, high-volume markets, but because of their economies of scale and specialized infrastructure requirements, they don’t call at smaller vehicle markets nearly as often — if they’re able to call there at all.
By contrast, many container lines regularly serve these smaller destinations and call at many ports that are too remote or inadequately equipped for ro-ro vessels to reach, including many places in Indonesia, Sri Lanka, Pakistan, the Philippines, the Caribbean, and parts of South and Central America.
Or suppose you’d like to ship your vehicles in smaller batches. Unlike cargo that is traveling via ro-ro, containerized vehicles can be shipped in small batches, which means that anytime a company has even a few vehicles ready to ship they can sail via the first departing vessel. This can substantially reduce or even eliminate the dwell time these same vehicles would ordinarily spend at ports and holding yards waiting for inventory levels to reach ro-ro-caliber volumes and help shave anywhere from one to four weeks off the average total vehicle transit.
Containerized automotive transport is also considerably less expensive and more cost-competitive on a per-vehicle basis than it once was, thanks to the recent container equipment options and operational efficiencies — including specialized racking and cassette systems and new 3PL services — that have been introduced. These have doubled or, in some cases, even tripled the number of vehicles that can securely travel in each container, allowing companies to save anywhere from 25 to 40 percent over what they once paid, even after the costs of returning this equipment to the origin port and having trained teams at origin and destination (to safely load and unload the vehicles) are factored in.
The potential economies of these equipment options are even more pronounced if you’re shipping commercial vehicles such as trucks. Because of their high dimensions, it already often costs the same amount whether you ship these larger vehicles via ro-ro — which charges by the cubic meter — or traditional containerized, one-level transportation options that charge a flat rate per container. More important, it costs up to 40 percent less than ro-ro if they’re shipped via any of the newer racked (or cassette) containerized transportation options that enable two trucks to be loaded in the same container.
There’s also the matter of international modal versatility. Ocean has traditionally been the most economical mode for shipping most vehicles, often by a significant amount. But with ocean carrier rates on the rise, there are now several lanes where cross-border train transits are just as inexpensive, not to mention anywhere from 55 to 70 percent faster. (One such example is the Silk Road rail between Europe and China.) More often than not, containerized vehicles can take advantage of this modal shift more quickly and frequently than vehicles that rely on ro-ro, because car containers are already designed to be multimodal.
Finally, don’t underestimate the correlation between direct product handling and potential damage. It’s not unusual for a ro-ro door-to-door transport to include at least eight direct vehicle touches as cars or trucks travel between production, road transport, port yard storage, ocean transport, feeder/road transport, distributor yards, and dealer compounds. By contrast, comparable cars-in-container transport includes just two — when cars are driven onto the container at the production line, and when they are driven off the container and unloaded at the dealer compound — because the only thing that is handled in between is the container itself. Generally speaking, fewer touches equal lower risk.
In offering this perspective, I do not mean to imply that ro-ro is not a highly credible transportation option; it clearly is. Nor do I wish to suggest that cars in containers are a panacea for every supply chain challenge that vehicle manufacturers face.
However, just as it’s true that most OEMs can’t succeed by offering a single make or model to every customer, then perhaps it is also true that a one-note approach to international vehicle transportation isn’t necessarily what’s best for your supply chain or customers.
Nothing will change the fact that more and more of your vehicles will need to travel to points far and wide. However, your company can alter the way it chooses to respond — and in the process help drive serious supply chain improvement.
Did you subscribe for our daily newsletter?
It’s Free! Click here to Subscribe!
Source: JOC
