5 structure and strategy thessaloniki 2007

Aristotle University of ThessalonikiLectures on freight : contemporary economicsand policy issuesStructure and strategyof freight industry: 

Aristotle University of Thessaloniki Lectures on freight : contemporary economics and policy issues Structure and strategy of freight industry Michel Savy savy@enpc.fr professor, ENPC and University of Paris 12 director, OPSTE ( www.cnt.fr )

1. Road transport: 

1. Road transport

Interest of the topics (road haulage) : 

Interest of the topics (road haulage) Transport production is still strongly structured according to modes, intermodal transport is limited Dominant position of road in inland freight transport in Europe quantitative domination sets reference price and quality of service for other solutions The organisation of road haulage market is an example and gives proper keys to understand all other modes industrial economics transport, organisation, logistics

Modal split in Europe 1970-2004 (ECMT, 44 members, %, t.km) : 

Modal split in Europe 1970-2004 (ECMT, 44 members, %, t.km)

Differences in modal split, within EU 27: 

Differences in modal split, within EU 27

Structure of road haulage: 

Structure of road haulage Technical specialisations local interurban vehicle renting with driver removal Economies of scale ? limits in vehicles size network effects, organisation ? Interaction between firms within haulage industry

Average size of road transport firms in European Union : 

Average size of road transport firms in European Union NB : firms and not groups

Road transport structure (4 criterion): 

Road transport structure (4 criterion)

Turnover per capita: 

Turnover per capita

Investment per capita: 

Investment per capita

Subcontracting rate in turnover: 

Subcontracting rate in turnover

Share of investments apart from transport equipment: 

Share of investments apart from transport equipment

2. Inland freight organisation: 

2. Inland freight organisation

Division of labour: 

Division of labour Inside road haulage, a division of labour no dualism, "bipolarisation" hierarchical interaction (integration of organisation, uneven profitability) no gap between transport and freight organisation Freight organisation parcel service (!) chartering international transport organisation (freight-forwarding)

Share of investments apart from transport equipment: 

Share of investments apart from transport equipment

Other criterion for classification: 

Other criterion for classification Statistic division only partly corresponds to actual market divisions transhipment type of product, size and packaging of consignment served territory quality of service, additional services make or buy ?

The "rule" of 3.10n: 

The "rule" of 3.10n n = 0, from 0 to 3 kg, courrier and small parcels n = 1, parcel service up to 30 kg n = 2, traditional parcel service (several parcels for one consignment) and heavy parcels, up to pallets (average 300 kg) n = 3, bulking, 1 to 3 tons consignments n = 4, full truck load, according to type of product and of packaging

From transport to logistics: 

From transport to logistics Transport and warehousing

Tendencies: 

Tendencies Concentration multi specialist groups setting up multinational following changes in production and distribution (flexibility) tracking and tracing, IT transport, logistics, supply chain Bipolarisation

3. Biggest transport groups: 

3. Biggest transport groups

Two types of transport: market (1) and organisation (2): 

Two types of transport: market (1) and organisation (2)

Biggest transport groups in the world (2005): 

Biggest transport groups in the world (2005)

Acquisitions of Deutsche Post AG: 

Acquisitions of Deutsche Post AG DHL Securicor (UK) Trans-O-Flex (Germany)) Ducros (France) Danzas (Switzerland) Nedloyd (Netherlands) ASG (Sweden) Air Express International (air freight-forwarding US) Burlington (inland parcel service US) Exel (which bought Tibbett and Britten) BPD (Belgium) TNT Netlog (Germany) ITG (Germany) GP Paketlogistik (Switzerland) Guipuzcoana (Spain) MIT (Italy) Sevisco (Poland) Quickstep (Austria, Switzerland, Tcshek Republic) Van Gend & Loos (Benelux) Sernadis, Arcatime (France) Technical and commercial integration (DHL) Staff : 500 000 Turnover : 55 G€

Biggest groups for post, transport, logistics (2003): 

Biggest groups for post, transport, logistics (2003)

Biggest 3PL (2004): 

Biggest 3PL (2004)

Biggest freight-forwarders (2004) : 

Biggest freight-forwarders (2004)

Biggest shipping companies, liners (2005): 

Biggest shipping companies, liners (2005)

Port terminal operators in Europe: 

Port terminal operators in Europe

Biggest airline companies and airports (freight): 

Biggest airline companies and airports (freight) Italiques : intégrateurs

Specialisation / versatility of groups: 

Specialisation / versatility of groups

Late Hays portfolio of activities: 

Late Hays portfolio of activities parcel service express parcel transfer of funds logistics archiving invoicing equipment renting organisation of fairs and exhibitions staff recruitment surveillance real estate management maintenance systems of communication services informatiques software development e-commerce etc.

Express: an unfinished globalisation: 

Express: an unfinished globalisation CA 2003

Perspectives: 

Perspectives Situation is not stable Heterogeneous situation in Europe, some firms and countries in dominating position Geographic strategy, European market control, enlargement Multimodal alliances, joint-ventures, fusions ? Continental models (Europe – USA – Japan) integrated groups marketing coordination of means providing companies Worldwide alliances, global players ?