The Cargo Fare Class Mix Problem

The intermodal hinterland transportation of maritime containers is under pressure from port authorities and shippers to achieve a more integrated, efficient network operation. Current optimisation methods in literature yield limited results in practice, though, as the transportation product structure limits the flexibility to optimise network logistics. Several transportation providers in the industry aim to overcome this with the concept of Synchromodality. We study the case of European Gateway Services' hinterland network in North West Europe: they are developing a portfolio of fare classes based on differentiation in price and lead time. However, higher priced fare classes come with tighter planning restrictions and must be carefully balanced with lower priced fare classes to match available capacity and optimise network utilisation.

We propose the Cargo Fare Class Mix problem, aimed at setting limits for each fare class at a tactical level, such that the expected revenue is maximised, considering the available capacity at the operational level. A solution method for a single intermodal corridor is proposed, serving one region with multiple destinations. We show that using a limit on each fare class increases revenue and reliability, thereby outperforming existing fare class mix policies, such as Littlewood. Currently, our work focuses on extending this approach to multiple corridor networks.

Registration to Remy Spliet, spliet@ese.eur.nl, is required for availability of lunch.