Viewpoint: Meet at Multimodal

I have just attended Multimodal, an excellent transport and logistics show held at the NEC in Birmingham, now in its third year.

All freight that involves a maritime leg is "multimodal" by definition, and some part of every supply chain in consumer goods or unit loads involves road transport.

In the last two decades there has been a step change in the efficiency of most companies involved in road transport. The emergence of fully integrated service provision covering all transport modes within the UK is generally to be welcomed for some supply chains. Nevertheless there will, I believe, always be a prime role for global freight forwarding companies in maximising the efficiency and cost of the supply chains; the skill is in undertaking the intermodal ÒseamlessÓ links.

There is a fundamental consideration in the use of third party logistics providers for suppliers. That is the passing over of responsibility for a key element of service so someone else whose potential for failure can do grave damage to a supplier’s business. I experienced this once when the supplier of special steels, products which required specialised handling techniques in delivery, had to restore its own control of the supply chain due to the inability of a third party to adopt the necessary skills. More recently a manufacturer of industrial paints was severely affected by the lack of national carriers with correctly certificated vehicles and drivers for small deliveries in which they specialised.

I accept that these examples represent only a small part of the unit load supply chain business which is essentially in FMCG and food, but manufacturers live or die by the final supply element of their service.

A seminar I attended at Multimodal featured Nick Gallop, MD of Intermodality LLP, whom I first met when he was with the former Distribution & Logistics Division of Deloitte. As one of the most practical exponents of intermodality, it was interesting to hear his views on developing rail freight.

In the early days of railway privatisation, the then infrastructure company, Railtrack, published a booklet listing the rail sidings and terminals that were presently redundant. Many had no future since they were simply in the wrong place for the future or the businesses they serviced had disappeared. However, many could be resuscitated and Nick made the point that even now there are many facilities, such as at Euston, which are falling into dilapidation or are severely underutilised. He cited the example of Channel Tunnel rail freight services which presently only operate at 18% of capacity. Full exploitation would remove 2,200 daily lorry loads from the roads.

Rail is receiving more consideration from supply chain planners. Tesco is to increase its use of complete trains from three to 12 trains per day within the UK, with Morrisons also active in this area. On the maritime front, I understand that Sainsburys is examining opening up redundant wharves in West London for containers shipped up the Thames from Tilbury. One does wonder about the current enthusiasm amongst UK political parties for the introduction of high speed passenger trains from London to the Midlands and Scotland. The saving of a relatively short time off a journey at a cost of billions seems to be a loss of perspective in the context of the need of moving goods to sustain the population. For example, the use of shuttle trains for HGVs could work wonders in places, but are currently restricted due to gauge constraints on the rail infrastructure.

Through a partnership with Invest Thames Gateway, Intermodality LLP and other stakeholders in the Thames and Medway regions are working to help the supply chain exploit underutilised rail and maritime links.

In the midst of the region is DP World’s planned £1.5bn, 3.5m teu London Gateway container terminal, and logistics park. Dredging the approach channel and berths commenced in March. Charles Meaby, general manger, tells me that expenditure for the first three berths is committed and the operation will commence in 2013.

While I have no reason to doubt DP World’s intentions, the proposed investment is enormous in consideration to the other container terminals under way or government approved such as Felixstowe South, Bathside Bay, and Bristol. With the prospect of Dibden Bay being put forward for reconsideration too, I was not surprised at Multimodal to hear other leading UK port executives express doubts about the ultimate development of London Gateway.

So-called port-centric logistics activities have been a long time becoming conventional wisdom in Europe, despite the long experience of Asian ports. I was once involved in promoting such a policy in Sines, Portugal, before the port went the way of becoming a transhipment terminal. The logistics park at London Gateway would offer 84ha of space but whether it is the right location for national distribution is a moot point. It may serve London with FCLs, but LCLs for national distribution? I examined this issue when involved with the approval of funding for the second river ontamination.

I ended my visit to Multimodal with the highlight of my day! Freightliner had in the exhibition hall one of its new fleet of General Electric US-built PowerHaul locomotives, for which there is presently an order for 30. This locomotive increases the payload from 24 to 30 wagons with improved acceleration and reduced fuel consumption and promises to greatly enhance rail freight capabilities in the UK. It was a particular thrill to sit in the cab and be given instructions on the operation of the locomotive by a train depot manager. Would that there had been a real track to run it on!