Update: Reducing the Operating Costs of Truck Transportation

Stephen DeAngelis

September 15, 2011

After posting a blog entitled Reducing the Operating Costs of Truck Transportation, I was contacted by Tom Stitt from Staxxon, a development stage start-up based in Montclair, NJ, that has developed an innovative folding and nesting container technology. He contacted me because I had mentioned a competitor, Cargoshell, that has also developed a collapsible TEU. Stitt told me, “The two companies have different design, business and engineering approaches to identifying opportunities for reducing the cost of empty container back-haul.” I’ve also uncovered a third company that makes collapsible containers, Compact Container Systems (CCS), LLC. In the interest of fairness, I’ll describe all three systems starting with Cargoshell. Following my discussion about collapsible containers, I provide a brief update on other trucking cost reduction topics.

 

One of the design differences between Cargoshell and the other two companies is the material used to construct the containers. Cargoshell’s collapsible TEU container uses a composite material that is “25 percent lighter than a steel container, meaning significantly less energy would be required to carry every container on their estimated 200 million annual trips.” [“The Cargoshell: ingenious collapsible replacement for the standard shipping container,” by Mike Hanlon, Gizmag, 6 January 2010, and “Collapsible Cargoshell shipping container seeks ISO certification,” by Mike Hanlon, Gizmag, 26 July 2010]. Hanlon points out that composite material has other benefits over steel. He writes:

“A Cargoshell produces only one third the amount of CO2 at the production stage, and repairs are far easier and more environmentally friendly too. The environmental benefits of a composite container extend far beyond just this however, as steel containers are forever being repainted to prevent corrosion and to keep them looking good. Composites don’t corrode when they come in contact with air and seawater, and as the gelcoat can be coloured to the corporate colours of the owner, they also never need repainting.”

There are drawbacks to the Cargoshell system — cost being the primary drawback. A Cargoshell container comes with “a price tag roughly three times that of a steel container.” As Hanlon puts it, “Cargoshell’s biggest problem is finding someone in the freight chain who is prepared to pay the extra money to replace the world’s 25 million 20-foot steel containers.” The other drawback is the time it takes to collapse the container. It takes one man approximately half-an-hour to expand or collapse the container. Considering the millions of containers used around the world, that represents a significant manpower cost. The Cargoshell can collapse “to one quarter its original size, meaning four empty Cargoshells can be transported together in the space normally required for one empty current container.” In addition, Cargoshell containers have roll-up doors versus traditional swing-out doors, which allow them to be stacked closer together.

 

Staxxon went a different direction and maintained steel construction for its containers. Another design difference is that its containers collapse horizontally rather than vertically. This means that you can get five collapsed containers in the same space as one. That’s a 25 percent improvement over the Cargoshell design. According to the company’s website:

“Staxxon’s top sustainability objective is to reduce the number of container ship movements as well as intra-state truck movements at ports related to empty containers. While some competitors have focused their environmental objectives around the use of composite materials to replace steel, Staxxon has focused on the larger environmental challenge of reducing net sea-going vessel movements and gate entries involving empty containers.”

It goes on to say, “Staxxon’s folding method allows existing container fleets to be repurposed to address sea lanes and routes with high empty imbalance scenarios instead of requiring wholesale replacement of existing container fleets.” Stitt informs me that the folding process for its containers is roughly the same as for the time required by the Compact Container Systems container discussed below (i.e., around 10 minutes). He points out, however, that a lot of considerations need to be taken into account when comparing systems.

 

“For example,” he asks, “[where] is the folding/nesting (unfolding/un-nesting) done?” That’s a terrific point, especially if unique handling equipment is required. Locations that might need to fold/unfold systems include: marine terminals, inland truck or rail terminals, empty container depots, distribution or manufacturing facilities. Who is completing the operation also matters (is it being done by skilled or semi-skilled personnel or by unskilled manual laborers?). Geographic location (as opposed to a type of facility) can also play a role. The following video shows how the Staxxon system works.

 

 

According the website, “Staxxon’s top business objective is to provide a retrofit and new container approach to folding and nesting that adds one-time incremental cost which is recovered rapidly from operational cost savings (fewer lift/picks/moves) and improved container utilization.” Obviously, Cargoshell cannot provide a retrofit option since its containers are all new construction.

 

Compact Container Systems, LLC, also uses steel for its collapsible containers. According to its website, “Compact Container Systems (CCS) introduces the world’s first family of foldable ISO containers — the FOLDX-40HC. A design so revolutionary, it is sure to change the fundamental economics of the shipping industry. Fully compatible with existing intermodal handling equipment, our patented design enables the FOLDX-40HC to be folded to a quarter of its original size — all to reduce back-haul shipping costs, storage costs and green house gas emissions.” In other words, the CCS system uses a vertical folding system like Cargoshell and steel like Staxxon. Like Cargoshell, 4 collapsed containers can fit into the space of one. In addition to using cheaper steel construction, CCS advertises that “the FOLDX-40HC can be quickly reduced by a two-person team in just ten minutes.” That is a 33 percent savings in manpower as well as being a much quicker conversion. Below is a video showing the FOLDX system.

 

 

It appears to me that the CCS system requires special handling equipment whereas the Staxxon system only requires a common forklift. However, CCS literature points out that the equipment can lift seven units at once, which can result in considerable savings. The good news is that these innovative companies are likely to change the future of container handling.

 

In my original post on reducing truck transportation costs, collapsible containers were an “Oh by the way” subject rather than the main focus. In this post, they are the main focus, but I’d also like to provide a brief update on other cost reduction topics. Since posting that blog, I found a 2008 fact sheet published by the Union of Concerned Scientists that “describes some of the technologies available … that can be installed on trucks, or specified as options on new trucks, to improve fuel efficiency through better aerodynamics and reduced rolling resistance.” Below is what the fact sheet had to say about aerodynamics and rolling resistance.

 

Aerodynamics

“When driving at highway speeds, about half of the power produced by the truck engine is used to overcome aerodynamic drag. Aerodynamics factors heavily into many new truck designs, but not all trucks and trailers come equipped with aerodynamic features. Some of today’s heavy-duty trucks come in aerodynamic designs which include low-profile side mirrors, integrated roof fairings, fuel tank side fairings, rounded bumpers, trailer gap reducers, and hidden exhaust stacks. According to manufacturers, all of these attributes add up to significant fuel savings and can improve fuel economy 15 to 20 percent compared to ‘classic’ style trucks. … More than 65 percent of the miles traveled by heavy-duty combination tractor-trailer trucks occur with box van trailers. The basic rectangular shape of the van trailer offers significant opportunities for improving the aerodynamics and fuel efficiency of the tractor-trailer combination. [Available] technologies … are designed to reduce turbulent air flow in the front of the trailer (in between the gap of the tractor-trailer), the underside (between the rear tractor tires and the rear trailer tires), and the rear (behind the rear doors). A combination of these trailer technologies, along with low-rolling resistance or single wide tires described below, can improve overall tractor-trailer fuel efficiency by am additional 10 percent or more.”

In my original post, I discussed the work of Kambiz Salari, a researcher at the Lawrence Livermore National Laboratory. He has demonstrated that a 17 percent improvement in efficiency can be achieved to through streamlining. Although that is a significant improvement, it is far less than the 25 to 35 percent improvement that the fact sheet claims can be obtained.

 

Rolling Resistance

“Besides decreasing aerodynamic drag, reducing the rolling resistance of heavy-duty truck tires can also help improve fuel efficiency. The friction between the rolling tire and ground, or rolling resistance, can be impacted by the design, materials, and the level of air pressure of the tire. Between 15 to 33 percent of heavy-duty truck fuel consumption is used to overcome rolling resistance. … Truck owners can reduce rolling resistance and improve fuel efficiency [in the following ways. First, use] low rolling resistance tires. The materials and design of a tire influence the rolling resistance characteristics. The US Environmental Protection Agency’s (EPA) SmartWay program identifies tire models that have the lowest rolling resistance and offer the best fuel economy improvements. … [Second, use] single wide tires. The most common configuration for tractor-trailers is to have dual (side-by-side) tires on each axle, except for the steering tires in front. Single wide tires are designed to replace each set of dual tires with one extra wide ‘super single’ tire. Super singles offer both aerodynamic benefits as well as improved rolling resistance. Super singles also offer weight reduction advantages, as the super single tire and rim weigh less than the two tires and rims that they are replacing. Aluminum rims can also be utilized to further reduce weight. Reducing weight offers improved fuel efficiency, or alternatively, allows a heavy load to be carried while continuing to meet highway weight restrictions. [Finally, use] auto tire inflation systems. Keeping tire pressures maintained on heavy-duty trucks is important for maximizing fuel efficiency, tire wear, and safety. Auto tire inflation systems help to maintain the proper inflation levels at all times, rather than only during periodic maintenance checks. The EPA estimates that a 0.6 percent gain in fuel efficiency can be realized with these systems. Greater improvements will be realized from auto tire inflation systems for fleets that currently do not frequently maintain tire inflation levels.”

Those are pretty pragmatic recommendations for reducing the costs of truck transportation and are in line with other recommendations that were discussed in my earlier post. The fact sheet concludes by mentioning some of those other recommendations:

“There are also additional strategies that can improve the fuel efficiency of today’s heavy-duty trucks, including improved logistics systems, more efficient engine and drive trains that include hybrids, lighter weight materials, lower carbon fuels, reduced highway speeds, elimination of idling, and improved driver training.”

Obviously, there are no silver bullet solutions for reducing truck operating costs. However, a combination of technologies and strategies can be used to make significant cost savings. In California alone, over 3 billion gallons of diesel fuel are consumed annually by big rigs. A modest 20 percent increase in efficiency would mean that around 600 million gallons of diesel could be saved a year. At $3.5/gallon, that’s an impressive $2.1 billion in savings — just in California.