Freight Transport Management

Increasing Commercial Vehicle Transport Efficiency


TDM Encyclopedia

Victoria Transport Policy Institute


Updated 6 September 2019

This chapter discusses ways of improving freight transportation efficiency by shifting improving the quality of efficient freight options (such as rail and integrated distribution services), providing incentives to use the most efficient option for each type of delivery, increasing load factors, improving logistics, and reducing unnecessary shipping distances and volumes.




Freight Transport Management includes various strategies for increasing the efficiency of freight and commercial transport. Logistics is a technical term for efficient freight management, including shipping practices (e.g., vehicle type, shipment size, frequency, etc.), facility siting, and related activities. Logistics usually focuses on minimizing shipper costs, with little consideration of social costs such as congestion or pollution impacts. Below are examples of Freight Transport Management activities:


·         Encourage shippers to use more resource-efficient modes such as rail and water transport rather than truck for longer-distance shipping. Trucking uses much more energy per unit of transport than rail or water (ten times as much in many situations), although only certain types of goods and deliveries are suitable for such shifting.


·         Improve rail and marine transportation infrastructure and services to make these modes more competitive with trucking. (Note that by reducing shipping costs this may increase total freight traffic volumes, resulting in little or no reduction in energy consumption, emissions or other externalities.)


·         Improve scheduling and routing to reduce freight vehicle mileage and increase load factors (e.g., avoiding empty backhauls). This can be accomplished through increased computerization and coordination among distributors.


·         Organize regional delivery systems so fewer vehicle trips are needed to distribute goods (e.g., using common carriers that consolidate loads, rather than company fleets).


·         Reduce total freight transport by reducing product volumes and unnecessary packaging, relying on more local products, and siting manufacturing and assembly processes closer to their destination markets.


·         Use smaller vehicles and human powered transport, particularly for distribution in urban areas.


·         Implement fleet management programs that reduce vehicle mileage, use optimal sized vehicles for each trip, and insure that fleet vehicles are maintained and operated in ways that reduce external costs (congestion, pollution, crash risk, etc.).


·         Encourage businesses to consider shipping costs and externalities in product design, production and marketing, for example by minimizing excessive packaging and unnecessary delivery frequency, and relying on more local suppliers.


·         Change freight delivery times to reduce congestion.


·         Increase land use Accessibility by Clustering common destinations together, which reduces the amount of travel required for goods distribution.


·         Pricing and tax policies to encourage efficient freight transport.


·         Increase freight vehicle fuel efficiency and reduce emissions through design improvements and new technologies. These include increased aerodynamics, weight reductions, reduced engine friction, improved engine and transmission designs, more efficient tires, and more efficient accessories.


·         Improve vehicle operator training to encourage more efficient driving.


·         Improve passengers’ ability to carry luggage and other baggage on public transit (Goldman and Murray 2011).



Heavy trucks represent about 10% of total vehicle mileage, and smaller commercial vehicles represent another 5-10% of total vehicle traffic. Heavy trucks represent a major share of total traffic on some highways, particularly around major ports, rail terminals and industrial areas. Because of their size, freight trucks impose relatively high congestion, road wear, accident risk, air pollution and noise costs, so travel reductions can provide significant benefits in areas where they are concentrated.


Truck transport tends to impose the greatest congestion costs, although exact impacts depend on specific conditions, such as the route and travel time. Many goods must be transported by local truck to their final destination, and long-haul trucking tends to impose relatively modest congestion impacts. Table 1 compares average costs, fuel consumption and pollution emissions for three major freight modes.


Table 1            Comparing Freight Modes – Per Ton-Mile (Grier, 2002)



Fuel Use






























How it is Implemented

There are many ways to encourage more efficient freight transport, often called logistics in transport planning (Schiller, Bruun, Kenworthy 2010). Some jurisdictions have strategic freight transport efficiency or emission reduction plans (de Cerreño 2006). Some strategies involve public planning and investments. For example, transportation and port authorities can improve intermodal transfer facilities, making it easier to shift loads from trucks to rail and water transport. Governments can also subsidize rail and marine transport industries if efficient pricing of road freight vehicles is infeasible (Casavant and Lenzi 1989).


The UK government promotes increased use of rail by investing in improved track access facilities (e.g. new sidings alongside existing rail lines) and by funding track access charges for privatized rail services (DETR 1999). Local governments can encourage more efficient delivery services (Takada and Kobayakawa, 1998; Böhler and Reutter, 2006). Governments can institute Pricing Reforms such as Weight-Distance Charges and Fuel Pricing that encourage more efficient freight transport (Kågeson and Dings 1999).


Private companies can improve their logistics. Firms can increase the efficiency of their own distribution networks, rely more on rail or marine transport for medium- and long-distance shipping, develop and use more local suppliers, find ways to reduce freight volumes, and use smaller vehicles or bicycles when appropriate for urban transport. Businesses can create cooperative distribution networks that consolidate loads, and develop services such as electric vehicle or bicycle delivery networks. Governments and public agencies can support research and education programs that improve best practices in the shipping industry. Hall (2007) recommends that port communities plan to increase sustainability and prepare for changing demands due to possible increases in future energy costs.



Travel Impacts

The potential for reducing freight traffic varies depending on location and what strategies are used.


The Price Elasticity of freight transport (measured in ton-miles) in Denmark is calculated to be –0.47, while the elasticity of freight traffic (measured in truck-kilometers) is –0.81 (Bjørner 2000). This means that a 10% increase in shipping costs reduces truck traffic by 8%, but total shipping volume by only 5%, because some freight is shifted to rail, while others are shipped using existing truck capacity more efficiently. Other researchers find somewhat higher road freight elasticities (Oum, Waters and Yong 1992). Freight traffic is affected by the price difference between modes. One study estimates that in Australia the elasticity of road freight travel with respect to the price ratio between truck and rail freight is –0.39 over the short term and –0.8 over the long term (Luk and Hepburn, 1993).


Table 2          Travel Impact Summary




Reduces total traffic.


Reduces a small portion of vehicles, but they tend to have relatively large impacts.

Reduces peak period traffic.


Usually reduces a small portion of vehicles on congested roads.

Shifts peak to off-peak periods.


Some freight management involves shifting peak-period trips to off-peak.

Shifts automobile travel to alternative modes.


Some freight management involves shifting deliveries to bicycle.

Improves access, reduces the need for travel.



Increased ridesharing.



Increased public transit.



Increased cycling.



Increased walking.



Increased Telework.



Reduced freight traffic.



Rating from 3 (very beneficial) to –3 (very harmful). A 0 indicates no impact or mixed impacts.



Benefits And Costs

Although freight vehicles represent only 10-20% of total vehicle mileage, they tend to impose large impacts. Reductions in freight traffic can provide the following benefits. See Litman (2002) and Gorman (2008) for information on freight cost studies, cost estimates and ways to calculate potential cost savings.


Reduced Traffic Congestion

Because of their large size and slower acceleration, heavy trucks impose more congestion per unit of travel than lighter vehicles. Freight vehicles are a small portion of total urban-peak traffic (operators tend to schedule their trips to avoid urban-peak driving to minimize congestion delays), but heavy trucks constitute a large portion of traffic on some corridors, such as highways to ports and major industrial areas.


Road Maintenance Cost Savings

Freight trucks cause high levels of road wear (FHWA 1997). A heavy truck can impose road wear costs hundreds of times greater than an automobile.


Energy Conservation and Pollution Reduction

Freight transport consumes 30-40% of total transportation energy (CST, 2001). Heavy diesel trucks consume about 22% of total roadway fuel, and produce high levels of particulate air pollutants, which are particularly harmful to human health. Heavy trucks tend to be much noisier than most other vehicles. Rail transport also imposes significant noise and air pollution, and land use impacts. Freight emissions can be a major contributor to pollution problems along major industrial transportation corridors (ICB Consulting, 2001). Some studies estimate that freight energy efficiency can realistically increase by 15-30% over a 10-20 year period.  Transport represents a major portion of lifecycle energy inputs in many products (Browne et al, 2005).


Reduced Crash Risk

Although crash rates for heavy trucks are relatively low, they can cause significant damage to other road users when a crash does occur, resulting in relatively high costs per vehicle-mile (Forkenbrock 2001; Safety Impacts of TDM).


Improved Community Livability

Freight traffic can degrade community livability by imposing noise, dust, air pollution, traffic risk and traffic delay, particularly in neighborhoods near major highways or terminals. Reducing freight traffic can reduce these impacts.


Improved Pedestrian and Cycling Conditions.

Heavy vehicle traffic is a particular deterrent to pedestrian and bicycle travel (Evaluating Nonmotorized Transport)


Financial Savings to Shippers

Logistical improvements that increase freight delivery efficiently can provide financial savings to shippers.


Freight management costs may include additional facility investments (such as improved rail and port terminals), subsidies and logistic management expenses. Disincentives (such as higher fuel taxes or fees) increase shipping costs, which will have a greater effect on industries and regions that are more dependent on transport. Price changes that are sudden and unpredictable impose transition costs that are economically harmful, because producers and consumers will not be able to take them into account when making long-term decisions, such as where to locate and what equipment to purchase.


Table 3          Benefit Summary




Congestion Reduction


Modest overall reductions in peak-period travel.

Road & Parking Savings


Heavy trucks cause significant roadway costs.

Consumer Savings


No direct impact.

Transport Choice


No direct impact.

Road Safety


Reduces traffic risk caused by large trucks.

Environmental Protection


Reduces air pollution caused by large trucks.

Efficient Land Use


Tends to encourage more infill/cluster development.

Community Livability


Reduces traffic impacts and noise caused by large trucks.

Rating from 3 (very beneficial) to –3 (very harmful). A 0 indicates no impact or mixed impacts.



Equity Impacts

Freight transport management has minimal equity impacts. Higher fees and taxes on heavy vehicles may disadvantage some groups (truckers and freight-intensive industries), particularly if they are sudden and unpredictable, but these usually represent an internalization of currently external costs (i.e., a reduction in current subsidies to heavy truck travel).


Table 4          Equity Summary




Treats everybody equally.


Impacts some groups more than others.

Individuals bear the costs they impose.


Reduces externalities.

Progressive with respect to income.


No significant impact.

Benefits transportation disadvantaged.


No significant impact.

Improves basic mobility.


No significant impact.

Rating from 3 (very beneficial) to –3 (very harmful). A 0 indicates no impact or mixed impacts.




Demand management can be applied to just about any freight transport activity, and is particularly appropriate in large urban areas with heavy freight traffic. It can be implemented by most levels of government and businesses. Because freight often travels across borders, freight transport management often requires international cooperation. Freight efficiency and impact reduction can be incorporated into international trade agreements and policies.


Table 5          Application Summary





Large urban region.


Federal government.


High-density, urban.


State/provincial government.


Medium-density, urban/suburban.


Regional government.




Municipal/local government.


Low-density, rural.


Business Associations/TMA.


Commercial center.


Individual business.


Residential neighborhood.




Resort/recreation area.


Neighborhood association.


Industrial centers and terminals




Ratings range from 0 (not appropriate) to 3 (very appropriate).




TDM Program and Improved Transport Choice



Relationships With Other TDM Strategies

Logistics improvements may be included in comprehensive TDM Programs. Least-Cost Planning, Pricing Reforms, Prioritizing Transportation and Road Space Reallocation and Smart Growth planning principles can support freight demand management. Congestion Pricing can improve truck traffic efficiency. Speed Reductions and Emission Reductions can help reduce freight vehicle impacts.




Freight planning and TDM programs can be implemented by various government agencies, and by businesses that profit from increased freight efficiency. Government policies can affect prices that provide an incentive for more efficient freight travel. Transport-intensive industries (such as those that rely heavily on raw materials), shipping firms and operators (such as truck drivers), and fleet operators all have an interest in Freight Transport Management. Businesses involved in environmentally friendly transport sectors, such as rail, waterway, and local delivery services can benefit from favorable policies and price incentives that make them more competitive.



Barriers to Implementation

Different freight TDM strategies face different barriers. Underpricing of freight travel (particularly trucks) and dedicated highway funding are major barriers to improved logistics since they reduce the incentive for more efficient shipping.



Best Practices

Best practices depend on the level of management (firm, city, region, nation, global) and the type of freight to be managed. The discipline of logistics provides a wide range of management guidelines and techniques to optimize freight transport efficiency. Below are guidelines for increasing freight transport system efficiency (T&E, 2000a; Miller, Kiguel and Zielinski, 2001; Böhler and Reutter, 2006; Piecyk and McKinnon 2007).


1.       Integration. Develop integrated freight transport networks. For example, facilitate intermodal systems that use rail and marine for longer-distance links, and trucks and human-powered delivery for shorter-distance links.


2.       Objectives. Establish specific objectives for freight transport activity that support sustainability, such as reduced energy consumption per ton-mile, encouraging use of less polluting modes, and placing a limit on total freight transport impacts in an area.


3.       Priorities. Give Priority to planning and investment decisions that support more sustainable freight modes. Use a bundle of management instruments to encourage more efficient freight transport.


4.       Level Playing Field. Correct market distortions that favor less sustainable modes over more sustainable modes. For example, tax, pricing and investment policies should not favor truck over rail or marine transport.


5.       Pricing. Implement the user pays principle, which means that prices reflect all costs unless a subsidy is specifically justified.


6.       Services. Encourage competition and entrepreneurial freedom in freight transport markets by allowing open access to rail networks and minimizing barriers to competition.


7.       Reduce Freight Volume. Encourage policies that reduce total freight traffic volume, including more local production, reduced product weight and packaging, reduced empty backhauls, and reduced waste production.



Wit and Humor

Why is it that when you transport something by car, its called a shipment, but when you transport something by ship, its called cargo?



Examples and Case Studies

Exel: How The Logistics Campus Can Reduce Unnecessary Trips and Enable the Efficient Flow of Goods to Market (

Exel Worldwide is an international provider of logistics services, which has pioneered the 'campus' concept - a collection of multiple manufacturers focused on consumer products with similar distribution channels. The collection of companies in a single location achieves critical mass in several key areas. It allows for the sharing of resources, freight consolidation and flexibility. A campus begins with establishing individual account(s) within a narrow geographic area, and grows organically through new business acquisitions. There are clear practical benefits and economic efficiencies to the campus - having facilities and resources close to consumer goods customers; being able to share labour resources among clients and operations; improved transit time and reduced order cycle time; and reduced inventory velocity and lower freight costs through volume leverage. In addition, there are also important environmental efficiencies made possible through the campus model.


For instance, in the past, if Loblaws requested an order of two truckloads of soup and one truckload of cereal, three trucks would go out. Now, only two trucks go out because the cereal can sit on top of the soup. Trips are reduced, and $600 can be saved by providing one less truck. The trend towards supply chain integration allows the linking of inbound goods with outbound goods and materials. The result, made possible by more sophisticated software and breakthroughs in tracking media, allows logistics specialists to mix inbound materials with outbound products, so that trucks have a higher load factor. In the area of Canadian food sales, which amounted to $66.2 billion in 1998, totalling 662,000 truckloads (two thirds of which were in the GTA), there is potential through consolidation to reduce truck movements by up to 30%. It is important to note that there is additional room to improve capacity efficiency because an average "full truck load" is 40,000 lbs and 2,300 cube, while the actual capacity is 62,500 lbs and 3,400 cube.


A more detailed version of this case study is featured in Moving Goods in the New Economy: A Primer For Urban Decision Makers, a joint publication of Moving the Economy ( and the Canadian Urban Institute (, available through Detour Publications (



Farming and Food Distribution (Pirog, et al, 2001)

Most consumers do not understand today’s complex global food system. Much of the food production and processing occurs far away from where they live and buy groceries. External environmental and community costs related to the production, processing, storage, and transportation of the food are seldom accounted for in the food's price, nor are consumers made aware of these external costs. Examples of external environmental costs are the increased amount of fossil fuel used to transport food long distances, and the increase in greenhouse gas emissions resulting from the burning of these fuels.


Local and regional food systems, where farmers and processors sell and distribute their food to consumers within a given area, may use less fossil fuel for transportation because the distance from farm to consumer is shorter. This paper discusses transportation from farm to point of sale within local, regional, and conventional food systems. Using fresh produce and other foods as examples, we considered miles traveled, fossil fuels used, and carbon dioxide emissions, and assessed potential environmental costs.


A food mile is the distance food travels from where it is grown or raised to where it is ultimately purchased by the consumer or end-user. A Weighted Average Source Distance (WASD) can be used to calculate a single distance figure that combines information on the distances from producers to consumers and amount of food product transported. U.S. Department of Agriculture Agricultural Marketing Service produce arrival data from the Chicago, Illinois terminal market were examined for 1981, 1989, and 1998, and a WASD was calculated for arrivals by truck within the continental United States for each year. Produce arriving by truck traveled an average distance of 1,518 miles to reach Chicago in 1998, a 22 percent increase over the 1,245 miles traveled in 1981.


A WASD was calculated for a sampling of data from three Iowa local food projects where farmers sold to institutional markets such as hospitals, restaurants, and conference centers. The food traveled an average of 44.6 miles to reach its destination, compared with an estimated 1,546 miles if these food items had arrived from conventional national sources.


Would there be transportation fuel savings and reduction in carbon dioxide (CO2) emissions if more food were produced and distributed in local and regional food systems? To answer this question, we calculated fuel use and CO2 emissions to transport 10 percent of the estimated total Iowa per capita consumption of 28 fresh produce items for three different food systems. A number of assumptions were used regarding production origin, distance traveled, load capacity, and fuel economy to make the calculations. The goal was for each of the three systems to transport 10 percent by weight of the estimated Iowa per capita consumption of these produce items from farm to point of sale.


The conventional system represented an integrated retail/wholesale buying system where national sources supply Iowa with produce using large semitrailer trucks. The Iowa-based regional system involved a scenario modeled after an existing Iowa-based distribution infrastructure. In this scenario a cooperating network of Iowa farmers would supply produce to Iowa retailers and wholesalers using large semitrailer and midsize trucks. The local system represented farmers who market directly to consumers through community supported agriculture (CSA) enterprises and farmers markets, or through institutional markets such as restaurants, hospitals, and conference centers. This system used small light trucks.


The conventional system used 4 to 17 times more fuel than the Iowa-based regional and local systems, depending on the system and truck type. The same conventional system released from 5 to 17 times more CO2 from the burning of this fuel than the Iowa-based regional and local systems.


This paper shows that fresh produce transported to Iowa consumers under the current conventional food system travels longer distances, uses more fuel, and releases more CO2 than the same quantity of produce transported in a local or Iowa-based regional food system. Given that fuel expenses are only a small percentage of total transportation and distribution costs, however, fuel energy costs will need to rise significantly if they are the only factor considered in determining whether local and regional systems are economically competitive with the conventional system. Economic value must be assigned to the external environmental cost of burning more fossil fuels and releasing more CO2. The authors strongly urge that more baseline research be conducted comparing the energy efficiency and external environmental costs of production, processing, packaging, and transportation sectors of conventional, regional, and local food systems.



City Logistics (

Product differentiation, reduced warehousing and declining shipment size all tend to decrease freight efficiency. Trucks are seldom filled to capacity and receivers have to handle many shipments. Several German companies now offer a service where shipments are consolidated outside the city centre.


About 80 German cities have set up “City Logistic” projects whereby shipments are consolidated outside the city limits and better organized within the city. The municipality, chambers of commerce and large haulers set up a trans-shipment facility and a new company that provides coordinated delivery services within the city. The service uses vehicles with state-of-the-art air and noise emission reduction features. To expand the service, geographic coverage can be increased, and services like cold transport and retail delivery may be added. To be competitive, the quality of service needs to be better than average. This type of service benefits municipalities (less spending on roads), citizens (less noise and pollution), railways (attract new inter-city traffic), and shippers (reduce costs).



Swiss Heavy Vehicle Fee (

Switzerland introduced a Heavy Vehicle Fee (HVF) in January 2001, as a result of a successful public referendum passed in 1998. The HVF charges heavy trucks (more than 3.5 tonnes) based on their gross weight, kilometres driven and emissions. The system was carefully planned and has been widely accepted by the freight industry. Billing for most trucks is based on data collected by an electronic on-board data collection unit that records vehicle mileage and route. At the end of each month the data are transmitted to the Swiss Customs Agency either by mail or electronically. This information is used to generate a bill, similar to other utilities.


Truck volumes on cross-Alpine routes were growing steadily prior to the introduction of this program, but has since leveled off, due to a combination of the HVF and increasing maximum vehicle weights from 28- to 34-tonnes (Werder, 2004). Environmental groups are lobbying to increase HVF rates and improve rail service, as demand management strategies.



Pooled Shipping (

Rail carloads of grain arriving at the Port of Vancouver are pooled in order to reduce congestion, irrespective of the originating railway and grain company terminal. Railways have created a common terminal railway in some cities. Similarly, inter-city couriers such as Purolator, FedEx, UPS and DHL could operate a common urban delivery system in the Greater Vancouver area in order to reduce vehicle kilometres.



Incorporating Environmental Objectives into Corporate Logistics

Firms can include transport efficiency factors in annual Environmental Reports. The German retailer Otto Versand received an EST! Best Practices award for developing a Green Supply Chair Management Program, which incorporates environmental objectives in organizing product shipping (OECD, 2000). The company developed new logistics chains (i.e., contracts with shipping and delivery agents) and analysis methods to determine which shipping option has the least environmental impacts. For example, when possible goods are transported by ship and train rather than truck, or truck rather than air. This reduced costs and increased profits as well as providing environmental benefits. As a result, the company:

·         Reduced CO2 emissions by more than 40%.

·         Cut costs by more than 3 Million Euros.

·         Developed new logistic chains like sea – train.

·         Developed new partners, like forwarders, agents

·         Is positioned to benefit from emission trading and other environmental instruments.



UK Sustainable Freight Policy (

The Department of Environment, Transportation and Regions published a sustainable distribution strategy (DETR 1999) which involves various methods to improve the efficiency of freight transport in order to minimize congestion, make better use of transport infrastructure, manage development pressures and reduce the negative environmental impact of freight movement. The strategy involves establishing best practices standards against key performance indicators, and implementing these throughout the transportation industries.


At the local level, the government plans to create ‘quality partnerships for urban distribution’, involving local authorities, the freight industry, the business community, residents and environmental groups, to find ways of rationalizing the pattern of freight delivery.  It is acknowledged that ‘land use planning can have a significant impact on distribution, not only through the provision of major transport infrastructure… but also more widely through policies and decisions on patterns of development…’.  Local authorities will be expected to do more to encourage a transfer of freight from road to rail and water, particularly by protecting sites and routes, which can be used to facilitate modal, interchange.


It proposes the adoption at a national level of ‘indicators for sustainable distribution’ against which future progress can be measured. The two chosen indicators of ‘freight intensity’ (ratio of total tonne-kms to GDP) and ‘lorry traffic intensity’ (ratio of vehicle-kms to GDP) have been on a downward trend in recent years, suggesting that things have been improving. On the other hand, this result may in fact reflect the incomplete nature of these two indicators in trying to measure progress toward sustainability; the DETR itself calls for the development and tracking of new indicators in the strategy as published. The document raises the possibility that in the future vehicle excise duty on lorries may partly reflect their environmental impact.


It is acknowledged that ‘congestion is increasingly common on the trunk road and motorway network’ and ‘forecast to get worse’.  The case for trying to ease congestion by expanding road capacity is largely rejected, with emphasis placed instead on making better use of existing road space and more effectively managing demand.  On routes where congestion remains heavy, there is a possibility that commercial vehicles may be given priority.



Benchmarking to Improve Freight Efficiency (McKinnon, Campbell, and Leuchers 1999)

A study of chilled food distribution involved developing Key Performance Indicators (KPIs) such as vehicle utilization, energy intensity per unit of freight moved, and on-time performance. These were used to evaluate the logistical efficiency of 25 participating firms relative to other comparable firms. The results helped identify factors that may reduce efficiency. Although overall averages are publicized, firm-specific results are disclosed privately to avoid putting a participant at a competitive disadvantage. The firms can then use the outcome to decide what level of performance is achievable, and track progress toward their goals through repeated participation in the survey.



Freight Village Concept (

A “freight village” is an area within which activities related to freight transport, logistics and goods distribution are coordinated, including shippers, warehouses, storage areas, public agencies and planners, businesses, etc. To encourage intermodal transport a freight village should be served by multiple modes (road, rail, waterways, air transport). This integrates the functions of freight handling and transfer to maximize efficiency.



Freight Coordination

A New Zealand software company, 4Technology, has created a website which matches empty trucks with one-off shipments. The website, at, promotes transport efficiency by providing a way both shippers and carriers can match freighting needs with available services.  It is aimed particularly at individuals and companies moving irregular large consignments.  Carriers will be charged 5 per cent of freight won and carried through use of the service.  A service fee will be charged to the shipper/ supplier.



Energy Efficiency Best Practices Program (

The Energy Efficiency Best Practices Program (EEBPP) is a government-sponsored information and awareness program that aims to stimulate energy savings in industry. It produces and disseminates information on freight fuel efficiency strategies. These include:

·         Benchmarks that companies can use to measure their performance.

·         Guidelines that assist organizations to adopt good driving practices.

·         Case studies that document successes and highlight the energy, environmental and cost-benefit of these measures.


A survey of fleet operators indicated that most have taken steps to save fuel, including driver training, aerodynamic styling, and use of alternative fuels. Fleets that have been actively involved in the program saved about 25% more fuel than those that have not.



Freight Transport Policy Reforms (World Bank and IRU 2017)

The report, Road Freight Transport Services Reform: Guiding Principles for Practitioners and Policy Makers, by the World Bank and the IRU describes how governments can reform freight transport to increase overall efficiency and sustainability. It presents a framework for the diagnostic of the transport sector including common inefficiencies, their causes and effects and instruments for the collection of reliable and useful data as a first step for the identification of the priority reform areas.



Pedal Powered Deliveries

Pedal Express is a human-powered cargo delivery service in the San Francisco Bay area. It operates a fleet of cargo bicycles capable of carrying up to 700 pounds in watertight containers. Common deliveries include meals and baked goods, books packages and post office box mail.



Telematics (OECD/IEA, 2001)

A variety of new technologies can be used to improve freight system efficiency, including driver information systems, on-board diagnostic equipment, computerized logistics for vehicle routing, and improved location and distribution planning. This could improve overall productivity in addition to energy savings. These are predicted to have the following energy conservation impacts:

·         5% for vehicle technical improvements and purchasing practices.

·         5-10% for driver training and monitoring.

·         More than 10% for fleet management and logistics measures.

·         Some companies that take a comprehensive approach could improve fuel efficiency up to 20%.



Off-Peak Freight Delivery (

New York City Department of Transportation (NYC DOT) sponsored a pilot program undertaken with the trucking industry found that trucks making off-hour deliveries between 7 p.m. and 6 a.m. instead of at peak hours experienced fewer delays, easier parking, reduced congestion and significant savings. The study found that businesses benefit significantly, with travel speeds improved as much as 75% and a sharp reduction in parking tickets and fines.


"New York is a city that never stops, and neither should its businesses," said Commissioner Sadik-Khan. "Time is money and this program is a signal to the entire industry that there’s an economic model for off-hour deliveries that also helps reduce congestion and pollution."


Freight deliveries into the borough exceed 100,000 daily, with 80% made to wholesale, retail and food enterprises. The pilot participants included a diverse group of eight delivery companies and 25 business locations who participated in the pilot for at least one month, including restaurants and retail stores. The project was funded with a $1.2 million dollar grant from the RITA and $640,000 from the project’s coordinator Rensselaer Polytechnic Institute (RPI). The pilot also included participation by Rutgers University, New York University’s Rudin Center for Transportation Policy and Management at NYU-Wagner and ALK Technologies.


"This is an excellent—and probably one of the most important and prominent—example of what can be accomplished when academia, the public sector and private companies join forces to tackle challenging goals such as achieving sustainable urban freight deliveries," said RPI’s Director of the Center for Infrastructure, Transportation and the Environment Professor Jose Holguin-Veras. "In essence, off-hour deliveries lead to reduced congestion and environmental pollution, increased competitiveness of the urban area and an increase in quality of life conditions. Everybody wins."


The pilot found that travel speeds from the truck depot to delivery drivers’ first stop in Manhattan improved by up to 75% compared to travel speeds during the evening rush hours, while subsequent trips averaged travel speeds up to 50% faster. With less competition for parking spaces accessible to the delivery location, trucks spent only 30 minutes stopped at the curbside making deliveries, instead of 100 minutes before the pilot. From beginning to end, delivery routes averaged 48 minutes faster during the pilot.


The project also focused on encouraging businesses to accept off-hour shipments through financial incentives and strategies to make the process easier, such as allowing "unassisted" deliveries—providing a key to the delivery team for a direct delivery or for delivery to a holding area, saving money for businesses that no longer had to have employees present to accept goods.

All participants saw savings during the four-month pilot, which ended in January. By having fresh food products waiting for them each morning, restaurants saw cost savings as staff were able to prepare food upon arriving rather than wait to assist in deliveries that are often delayed due to traffic congestion.



Freight Transport Management Incentives (Holguin-Veras, et al. 2010)

A major study for the U.S. Department of Transportation used Global Positioning System (GPS) technology to more efficiently manage urban truck traffic. This project:


The researchers concluded that this project demonstrates that remote sensing technology can help manage freight transport in ways that are supported by both the freight industry and transportation agencies.



Canadian Pacific Railway's Expressway (

Expressway is a revolutionary short- to medium-haul transportation service that combines the best of truck and rail to help reduce costs and better serve customers' needs. Developed with input from trucking companies, Expressway allows shippers to move their standard, non-reinforced trailers in high-volume corridors. Expressway services are strategically located — with hubs in Toronto, Montreal and Detroit providing round-the-clock services and an easy-to-use reservation system.


Local drivers delivering the trailers spend no more than 15 minutes at the terminal because of a new information system which allows customers to book slots on the trains by Internet. While booking, customers also send their bill-of-lading information electronically, providing advance information to hand-held computer technology which drives all the processes within the terminal. These hand-held units register a record of the reservation, ID number and trailer number. When the driver arrives, the information is confirmed. The driver is then presented with a receipt, and after a final inspection of the trailer, contents are sealed and the driver is off. Information input in the hand-held units transmits immediately to the main computer and to hand-held units in the destination city, for an equally fast pick-up procedure.


The train averages 50 mph over the 350 mile Montreal-Toronto corridor. This speed is very comparable to truck transit. Market reaction has been positive, since costs are competitive with trucking. The service currently handles 16,600 trailers annually. An expanded service is projected to take 50,000 trailers a year off the highway.



Reducing Freight Transport Emissions In North America

A study by the Commission for Environmental Cooperation investigated ways that Canada, Mexico and the United States could use to reduce North American fright transport greenhouse gas emission. They identified the following policies and strategies:



Truck Fuel Efficiency (

The Transport and Logistics Research Unit at the University of Huddersfield performs research on vehicle fuel efficiency in order to help transport operators reduce their fuel consumption and costs. It identifies and evaluates various strategies for improving freight vehicle fuel efficiency, and promotes those that are considered most effective to industry. Promising strategies including reduced vehicle mileage through better routing and scheduling, improved vehicle drive system efficiency and aerodynamics, driver training and improved maintenance.



Vancouver Industrial Land (

Although planning policy to support intensification has generally focused on housing density, the location of jobs is a major determinant in regional land use and travel demand. With this in mind, in 1993, the City of Vancouver undertook a comprehensive review of the role and function of its industrial land stock. The study's conclusions recommended preserving remaining stock, and City Council subsequently endorsed a policy of industrial land retention in 1995.


Both the City of Vancouver and the Greater Vancouver Regional District have a policy of "planning by proximity", to minimise transport demand through the convenient arrangement of land uses. The two key benefits of proximity with regards to industrial land are: 1) the employment of city residents in city industry, and 2) efficient city servicing. Vancouver's industrial land base comprises about 1600 acres, representing 6% of the City's land area. The land accommodates about 2000 firms, providing 46,000 jobs. Market demand for this industrial land is high, demonstrated by low vacancy rates, at 2% in 1998.


Worker densities in Vancouver's industrial areas are three times higher than those in the suburbs. About two thirds of Vancouver's resident industrial workers work in a job located in the city and, of these, 24% get to work by transit, while 12% walk or cycle. Of industrial workers in Richmond, a neighbouring suburban municipality south of the city, only 5% take transit and 2% walk or cycle.


Industrial areas can be looked upon as the "refrigerator, storeroom and repair room of the downtown." Some food suppliers, for example, make several delivery trips a day to large downtown hotels. This aspect of industry has important transportation implications. In Vancouver, city industry sells 70% of all goods and services sold in the region to customers located within the city itself. For supplies, city industry receives 60% from other city firms. The City of Vancouver identified significant transportation benefits from maintaining a supply of centrally-located industrial land. Social and economic benefits include a diversity of jobs to meet the needs of a diverse population, and a solid business tax base.



Off-Peak Delivery

LaBelle, Sheena and Gottschling (2016), in collaborated with the Supply Chain Innovation Network of Chicago (SINC), investigated possible ways to shift goods deliveries from peak to off-peak as a congestion reduction strategy in the Chicago area.  They found that:

1.       Off-peak Delivery (OPD) programs have been successfully implemented around the world. Although it is happening now, better data is needed to understand its extent.

2.       OPD can yield substantial benefits, but it can be challenging to implement.

3.       The benefits and costs of OPD are not always evenly distributed. An OPD program would need to be carefully designed to balance the benefits and costs to make it practical for carriers, receivers, shippers, customers and the community.



Transport Canada Freight Sustainability Demonstration Program (

The Freight Sustainability Demonstration Program is five-year, $4.5 million program designed to encourage the take up of technologies or best practices that can reduce greenhouse gas emissions from all freight modes. It supports the demonstration and evaluation of innovative tools, technologies, and best practices, which appear to hold promise for cost-effective reduction of GHG emissions, but where risk or uncertainty impedes early adoption. The projects will be selected through a competitive process. During its first year it funded the following projects.


Athabasca Northern Railway Ltd. - GM GP-9 Layover Protection

Under this project, two GM GP-9 locomotives will be equipped with the Kim Hotstart Diesel Driven Heating Systems (DDHS) and monitored for fuel efficiency and GHG emissions. The DDHS is a diesel-powered water and oil circulating and heating system that engages when the locomotive shuts down. Its purpose is to reduce idling time. The project will take place in the Fort McMurray area in Alberta.


Kelsan Technologies Corp. - Top of Rail Friction Control

Kelsan Technologies will be demonstrating the Top of Rail Friction Control on two BC Rail freight locomotives that will run between Chetwynd and Prince George, British Columbia for several months. Fuel consumption and GHG emissions will be measured during the demonstration. In addition to reductions in fuel use and GHG, the project is expected to result in reduced noise and maintenance costs to the trains and the rail lines.


Nexus North Inc. - Nunavut Express Container Service

Nexus North's project will demonstrate a new intermodal container express service connecting Winnipeg and Thompson with the Port of Churchill and isolated communities in Nunavut. The service offered will consist of collecting container cargo in Winnipeg, principally goods for the re-supply of northern communities, and then, under a basic "hook and pull" service agreement with Via Rail, pulling a Nexus North flatcar behind Via Rail's regular remote passenger service train to Thompson and Churchill. The project will enable intermodal efficiencies by utilizing self-loading container chassis technology, which transfers marine containers to and from different transport modes (e.g. truck flatcars, rail flatcars, marine barges). Fuel consumption and GHG emissions will be monitored during the demonstration.


Southern Railways of British Columbia - ZTR Control Systems' SmartStart Technology

Though this project, Southern Railways will equip two of its seven locomotives with the ZTR SmartStart automatic shut down / restart system. This technology automatically shuts down and restarts the locomotive depending on environmental conditions and the temperature of critical locomotive systems to prevent engine freeze-up. The equipment reduces idle time. Fuel consumption and GHG emissions will be monitored during the demonstration, which will take place in the Fraser Valley of British Columbia.


Inventory Optimization (Battini, Persona and Sgarbossa 2014)

Firms often make trade-offs between transportation and inventory storage costs: more frequent shipments of smaller loads increase transportation costs but reduce storage costs. Managers use the economic order quantity (EOQ) to identify the order quantity that minimizes total holding and ordering costs Battini, Persona and Sgarbossa (2014) propose a “Sustainable EOQ Model” which incorporates environmental impact within the traditional EOQ model. All sustainability factors linked to the material lot size are analyzed from the beginning of the purchasing order to the end of its life inside the buyer plant. Thus, the environmental impact of transportation and inventory is incorporated in the model and investigated by an economic point of view. In particular internal and external transportation costs, vendor and supplier location and the different freight vehicle utilization ratio are considered in order to provide an easy-to-use methodology. The optimization approach is applied to representative data from industrial problems to assess the impact of sustainability considerations on purchasing decisions if compared with the traditional approaches.


Fleet Route Optimization (

The Solid Waste Management Division of the City of Toronto's Works Department, in collaboration with its Green Fleets Committee, has launched a route optimization program. Route optimization can also be applied to snow removal, salting, sweeping, street flushing and litter can collection.

Since waste generation varies significantly throughout the calendar year, the key is to match the labour force, trucks, and equipment to waste generation, and to expand and contract routes based on changes. To calculate the shortest routes, the City's system draws on databases and historical information about streets, collection attributes, service days and waste generation variances. By generating tabular information, such as where each collection vehicle should be at different times of the day, the system also provides greater capability for supervision and management.

The City estimates that its garbage and recycling collection vehicles travel approximately 4 million km per year (about 1.8 km per capita). Based on outcomes so far, route optimization will generate travel reductions of approximately 20%, or 800,000 km per year. Because these vehicles are large, heavy and constantly stopping/starting, fuel savings, emission reductions and reductions in road impacts are relatively large. A projection reduction in fleet requirements of approximately 40 trucks can save $1 million per year. More efficient us of staff time can also provide savings.


References and Resources for More Information


Daria Battini, Alessandro Persona and Fabio Sgarbossa (2014), “A Sustainable EOQ Model: Theoretical Formulation and Applications,” International Journal of Production Economics, Vol. 149, pp. 145-153.


Thomas Bue Bjørner (2000), “Environmental Benefits from Better Freight Transport Management: Freight Traffic in a VAR Model,” Transportation Research D, Vol. 4, No. 1, January 1999, pp. 45-64.


Susanne Böhler and Oscar Reutter (2006), “Delivery Services for Urban Shopping: Experiences & Perspectives,” World Transport Policy & Practices, Vol. 12, No. 1 (, pp. 47-53.


M. S. Bronzini (2008), Relationships Between Land Use and Freight and Commercial Truck Traffic in Metropolitan Areas, for the Committee on the Relationships Among Development Patterns, Vehicle Miles Traveled, and Energy Consumption; for Special Report 298, Driving And The Built Environment: The Effects Of Compact Development On Motorized Travel, Energy Use, And CO2 Emissions, Transportation Research Board (; at


Michael Browne, et al. (2005), “Life Cycle Assessment in the Supply Chain: A Review and Case Study,” Transport Reviews, Vo. 25, Is. 6, pp. 761-782 (; at


Caltrans (2016), The California Sustainable Freight Action Plan, California Department of Transportation (; at


Kenneth Casavant and Jerry Lenzi (1989), “Rail Line Abandonment and Public Acquisition Impacts on Economic Development,” Transportation Research Record 1274, TRB (, pp. 241-251.


CIVITAS (2015), Making Urban Freight Logistics More Sustainable, CIVITAS (; at


Allison L. C. de Cerreño (2006), Identifying and Reducing Institutional Barriers to Effective and Efficient Freight Movement in the Downstate New York Region, Rudin Center for Transportation Policy & Management, NYU Robert F. Wagner Graduate School of Public Service (


DETR (1999), Sustainable Distribution: A Strategy, Department of the Environment, Transport and the Regions (


Alan S. Drake (2013), “Building an Optimized Freight Transportation System,” Transport Beyond Oil: Policy Choices for a Multimodal Future, (Renne and Fields, eds), Island Press (; at


FHWA (1997), Federal Highway Cost Allocation Study, US Department of Transportation (; available at


David Forkenbrock (2001), “Comparison of External Costs of Rail and Truck Freight Transport,” Transportation Research A, Vol. 35, No. 4 (, pp. 321-337.


GAO (2011), Comparison of the Costs of Road, Rail, and Waterways Freight Shipments that are Not Passed on to Consumers, Government Accountability Office (; at


Andrew R. Goetz and Serena Alexander (2019), Urban Goods Movement and Local Climate Action Plans: Assessing Strategies to Reduce Greenhouse Gas Emissions from Urban Freight Transportation, Mineta Transportation Institute at San Jose State University (; at


Joey M. Goldman and Gail Murray (2011), Strollers, Carts, and Other Large Items on Buses and Trains: A Synthesis of Transit Practice, Synthesis 88, Transit Cooperative Research Program (TCRP), TRB (; at


Michael F. Gorman (2008), “Evaluating the Public Investment Mix in US Freight Transportation Infrastructure,” Transportation Research A, Vol. 42, Issue 1 (, pp. 1-14; summary at


Green Freight Transport (, provides various documents on sustainable freight transport policies.


David V. Grier (2002), “Comparison of Inland Waterways and Surface Freight Modes,” TR NEWS 221, Transportation Research Board (, July-August, p. 17;  at


Peter V. Hall (2007), “Seaports, Urban Sustainability, and Paradigm Shift,” Journal of Urban Technology (, Vol. 14, No. 2, August, pp. 87-101; at


Bernhard Herzog (2010), Urban Freight In Developing Cities, Module 1G in the Sustainable Transport: A Sourcebook for Policy-makers in Developing Cities, published by the Sustainable Urban Transport Project – Asia ( and Deutsche Gesellschaft fur Technische Zusammenarbeit (; at


Jose Holguin-Veras, et al. (2010), Integrative Freight Demand Management In The New York City Metropolitan Area, Rensselaer Polytechnic Institute for the USDOT (; at


Jose Holguín-Veras, et al. (2015), Improving Freight System Performance in Metropolitan Areas: A Planning Guide, National Cooperative Freight Research Program Report 33, Transportation Research Board (; at


ITF (2018), Towards Road Freight Decarbonisation, International Transport Forum (; at


Per Kågeson and Jos Dings (1999), Electronic Kilometre Charging for Heavy Goods Vehicles in Europe, European Federation for Transport and Environment (


James C. LaBelle, Sheena F. Frève and Ellen Gottschling (2016), Exploring the Potential for Off-Peak Delivery in Metropolitan Chicago: Research Findings and Conclusions, Urban Transportation Center (; at


Todd Litman (2006), Transportation Cost Analysis; Techniques, Estimates and Implications, Victoria Transport Policy Institute (


James Luk and Stephen Hepburn (1993), New Review of Australian Travel Demand Elasticities, Australian Road Research Board (


Christopher Lamm, et al. (2017), Guide for Integrating Goods and Services Movement by Commercial Vehicles in Smart Growth Environments, National Cooperative Highway Research Program, Research Report 844, TRB (; at


A.C. McKinnon, J. Campbell and D. Leuchars (1999), Benchmarking Vehicle Utilisation: Measurement of Key Performance Indicators, Energy Efficiency Best Practice Programme, Department of the Environment, Transport and the Regions (


Glen Miller, Daniela Kiguel and Sue Zielinski (2001), Moving Goods in the New Economy: A Primer for Urban Decision Makers, produced by Moving the Economy ( and the Canadian Urban Institute (, available through Detour Publications (


Robert B. Noland and Zia Wadud (2007), “Review of Oil Demand Restraint Policies for Heavy Goods Vehicles,” Energy Sources Part B: Economics, Planning, and Policy ( 


Mehdi Nourinejad, Adam Wenneman, Khandker Nurul Habib and Matthew J. Roorda (2013), Truck Parking in Urban Areas: Application of Choice Modelling Within Traffic Microsimulation, Canadian Transportation Research Forum (; at


Office of Freight Management & Operations, FHWA ( provides information to promote more efficient freight transport.


Tae Hoon Oum, W.G. Waters II and Jong-Say Yong (1992), “Concepts of Price Elasticities of Transport Demand and Recent Empirical Estimates, Journal of Transport Economics, May 1992, pp. 139-154.


Marta Panero, Hyeon-Shic Shin and Daniel Polo Lopez (2011), Urban Distribution Centers: A Means to Reducing Freight Vehicle Miles Traveled, Rudin Center For Transportation Policy And Management (; at


Zachary Patterson, Gordon O. Ewing and Murtaza Haider (2008), “The Potential For Premium-Intermodal Services To Reduce Freight CO2 Emissions In The Quebec City–Windsor Corridor,” Transportation Research D (, Vol. 13, pp. 1-9.


M. Piecyk and A. McKinnon (2007), Internalising The External Costs Of Road Freight Transport In The UK, Logistics Research Center, Heriot-Watt University (; at  


Rich Pirog, et al. (2001), Food, Fuel, And Freeways: An Iowa Perspective On How Far Food Travels, Fuel Usage, And Greenhouse Gas Emissions, Leopold Center for Sustainable Agriculture



Robert Salter, Subash Dhar and Peter Newman (2011), Technologies for Climate Change Mitigation: Transport Sector, Risø Centre on Energy, Climate and Sustainable Development, United Nations Environmental Program (; at


Preston L. Schiller, Eric Christian Bruun, Jeffrey R. Kenworthy (2010), An Introduction to Sustainable Transportation: Policy Planning and Implementation, EarthScan (


Smartset Project ( provides information on ways to improve freight transport in cities.


Smart Freight Centre ( is a global non-profit organization that promotes a global freight sector that is more environmentally sustainable and competitive.


Kinimichi Takada and Satoru Kobayakawa (1998), “The Influence of Restructuring the Goods Movement System on Transportation Demand Management (TDM),” IATSS Research, Vol. 22, No. 1, pp. 59-68; at


T&E (2000a), Towards More Sustainable Freight Transport, European Federation for Transport and Environment (; at


T&E (2000b), Counting the Kilometres - And Paying for Them; How to Introduce an EU Wide Kilometre Charging System, European Federation for Transport and Environment (


TRB (1998), Policy Options for Intermodal Freight Transportation; Transportation Research Board Special Report 252, Transportation Research Board (


TRB (2007), Guidebook for Integrating Freight into Transportation Planning and Project Selection Processes, National Cooperative Highway Research Program (NCHRP) Report 594, Transportation Research Board (; at


Dimitrios Tsamboulas, Huub Vrenken and Anna-Maria Lekka (2007), “Assessment Of A Transport Policy Potential For Intermodal Mode Shift On A European Scale,” Transportation Research Part A, Vol. 41, No. 8 (, pp. 715-733.


USDOT (2010), Advancing Metropolitan Planning for Operations: The Building Blocks of a Model Transportation Plan Incorporating Operations - A Desk Reference, Planning for Operations, US Department of Transportation (; at


Huib van Essen, Olivier Bello, Jos Dings and Robert van den Brink (2003), To Shift Or Not To Shift, That's The Question: The Environmental Performance Of The Principle Modes Of Freight And Passenger Transport In The Policy-Making Context, CE (; at


Francis M. Vanek and Edward Morlok (2000), “Improving the Energy Efficiency of Freight in the United States Through Commodity-based Analysis,” Transportation Research D, Vol. 5, No. 1.


Francis M. Vanek (2001), “Sustainably Distributed? An Environmental Critique of the UK’s Sustainable Distribution Policy,” World Transport Policy and Practice, Vol.6 No.2 (, pp. 5-12. 


Amiy Varma and Alan Clayton (2010), “Moving Goods Sustainably in Surface Transportation,” ITE Journal (, Vol. 80, No. 3, pp. 20-24.


Hans Werder (2004), Impact of the Heavy Vehicle Fee - Central Pillar of the Swiss Transport Policy, CEMT-Conference "Managing Transport Demand Through User Charges - Experience To Date", Swiss Federal Office for Spatial Development (


World Bank and IRU (2017), Road Freight Transport Services Reform: Guiding Principles for Practitioners and Policy Makers, World Bank and IRU (; at


WTPP (2004), World Transport Policy & Practice: Special Issue on Logistics and Transport, Vol. 10, No. 3 (


Wuppertal Institute ( has done considerable research on strategies to increase freight efficiency and reduce environmental and social impacts.


This chapter was written with the valuable assistance of Francis Vanek of the Sustainable Technology and Energy Institute (

This Encyclopedia is produced by the Victoria Transport Policy Institute to help improve understanding of Transportation Demand Management. It is an ongoing project. Please send us your comments and suggestions for improvement.




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