Air Transport

AIR TRANSPORT

Air transport has the highest speed compared to any other transport .

Operating cost are highest but fixed cost are lower than rail or road.

Air transport are highly reliable during emergency and seasonal demand

Bring closer Far and new market within reach. Flexible Carry both heavy & bulky Less damage to goods Minimum handling High Speed Fastest mode of transport ,suitable for long distance. Quick service Comfortable, efficient & quick transport service

ADVANTAGES

Restricted Products Certain items are not allowed Narrow coverage Air transport facilities are not available everywhere

because airports are in big cities. Risky Because a minor accident may lead to substantial

loss. Very Costly Costliest mode of transport Unreliable Due to the weather condition

DISADVANTAGES

Rope way transport

Used for transporting materials in

hilly areas. It connect point of

supply and demand by shortestroute.

ADVANTAGES DISADVANTAGES

•Transports bulk material over short distance

• Limited scope of operation because it can function only on hilly area

•Lower capital cost •Its slow mode of transport

•Its ideal for hilly area

•Does not pollute the environment

Transport formats

Common Carrier

Private carriers

Contract carrier

Exempt carrierExempt carrier

Common Carrier

Basic foundation of public transportation is common carrier. Offer service at non-discriminatory price to public

Contract carrier

Provides transport services for select customers.

Agreement between a carrier and a shipper for a specified transportation service

Private carriers

A firm providing its own transportation.

It’s not for hire, not carry hazardous goods and takes care of employee safety, vehicle safety

Exempt carrierExempt carrier It does not follow economic regulation

Exempt commodities include unprocessed agricultural products and

extracted raw material.

Product related

Factors influencing transportation cost and pricing

DensityRefers to weight and space aspects

Weight and space are important StowabilityProduct dimensions

Items with rectangular shapes

Market related

Product related factors

Handling

Equipments required for loading or unloading

Liability products are prone to damage

Location Govt regulation transportation

Market related factors

Cost associated with transportation

Movement cost

Inventory costs

Obsolescence

Insurance

PackagingCost of fuel to

drive the vehicle Inventory

holding cost,

Longer the inventory = Larger cost

Transit time is larger the

inventory becomes

waste, when it arrives

Its dependant on mode

selected as bad road condition

needs strong

packaging.

Cost proportional to risk of

damage and loss in transit

Freight rate structure These are transportation rates charged by carriers

for shipping the goods to buyers.

Should cover all cost of transportation Vehicle utilization

Principles of freight rate

•Terminal detention•Nature of goods•Density, Consignment•Stowability

Public use

Govt policy

For transportation, strong infrastructure is primary

TRANSPORT INFRASTRUCTURE

Elements of transportation infrastructure

Terminal Facility

VehiclesRight of

WayPrime

moversCarrier org

Well maintained loading and unloading facilities , platforms,

railway road

Their size, shape and

speedPassage

for vehicle should be in good

condition

These are the transportation

service providers in business,

TRANSPORTATION= BUISNESS

Transportation Hidden Cost

Transportation of raw materials, project materials and equipment include 20-30% of total capital cost.

In India, entrepreneurs get incentives set up manufacturing facilities in rural area but they lack infrastructure.

Eg:-Vehicles get stuck in muddy road- materials doesn't reach to site, vehicle accidents these increase transportation cost.

Delays- non receipt of equipment, machinery, raw materials-delays run into months.

Due to such delays the project suffer heavy loss

SELECTION OF MODE OF TRANSPORTATION

Characteristic of goods

Cost

AvailabilityDelivery time

DistanceFrequency

Goods are expensive then fastest mode of

transportationDepending upon the nature of

goods

Satisfy customers the goods should be available, mode of

transportation - accessible

Depends on the distance. Short distance= road way,

long=sea or air way

Before selection a mode of transport the cost factor is

imp

Details on delivery such as schedule

delivery time, date of delivery

etc

Selecting mode of transport its service frequency should be

analyzed ,no. of times the carrier go to and fro towards source and

destination