Dispatch 2.11 2.indd - Logistics Association of Australia

NSW EVENT REPORT
Road vs Rail
The point was also made that rail is a
more secure distribution method for
hazardous materials or explosives that
could be terrorist targets.
The discussion brought to the fore
some key drivers in the choice of road
transport.
Left to right: Zoran Cucukovic, Panel Moderator
with panel members John Crosbie, Consultant; Peter
O'Sullivan, Cement Australia; Wayne Klose, OneSteel;
Greg Jones, SCT Logistics; Steven Thacker, Ingram
Micro and LAA President, Brad Harrison.
A joint LAA/APICS Dinner Meeting in
Sydney on 21st November attracted
almost 100 members and guests. The
evening departed from the normal
presentation with a panel discussion
on the topical issue of Road vs. Rail.
With freight activity in Australia
projected to double by 2025, rail could
appear to provide the most effective
and economic opportunity to satisfy this
growth. To date, however, government
funding has favoured road over rail.
Zoran Cucukovic, Panel Moderator,
opened up the discussion with the panel
members who all had some interesting
thoughts on the matter. The following
issues were raised during the session
and in the question time that followed.
Although rail is generally seen as the
appropriate transport medium for
industries that handle bulk goods, even
within these types of industries, it can
pose limitations. For instance, with grain
volumes affected by climatic extremes
and sites spread right across Australia,
the freight task becomes uncertain and
difficult to manage. Added to this are
problems such as whether particular
geographic locations have access to a
rail network, an aging rail infrastructure,
and the perception that as far as
innovation and funding is concerned,
rail is the 'poor cousin'.
On the positive side, there are some
substantial benefits to be gained from
rail freight services. Rail is more energy
efficient than road transport, it produces
less air pollution and fewer greenhouse
gases. It is also safer than road and
helps to reduce traffic congestion.
The size of consignments and customer
demand are major factors. For
companies that despatch consignments
or parcels that number in the thousands
every day of the week to disparate
destinations, the only viable solution is
road freight.
Global sourcing and manufacturing
off-shore have had a significant impact
on the freight task and, a growing
population and increased consumerism
is causing the freight task to double
every 15 years.
This situation is compounded by JIT and
a 'next day' delivery mentality, or shorttermism,
that currently prevails. Social
and environmental issues are linked.
With rising fuel prices and heightened
awareness of climate change, the
thought was posed that maybe 'next
day' will come to be seen as greedy and
delivery in three days will be seen as
responsible. Cost was not considered to
be a significant factor, value was seen as
a more important determinant.
As the focus on reducing carbon
emissions increases, the environmental
impact of thousands of trucks on
the road day and night will not be
acceptable. Road fleets will be required
to make better use of fossil fuels or
adopt alternative technologies.
What emerged clearly during question
time was that, for the supply chain
industry, the question is not whether
to choose one mode of transport over
another. Few supply chains can be
exclusive in this. We have to look at our
alternatives as supply chain people. It is
more than likely that the most efficient
and timely supply chain task will
encompass both rail and road transport.
We thank all panel members for
generously contributing their time to
take part in this discussion.