IDEAS home Printed from https://ideas.repec.org/a/eee/ejores/v259y2017i1p113-129.html
   My bibliography  Save this article

Payload-based fleet optimization for rail cars in the chemical industry

Author

Listed:
  • Kallrath, J.
  • Klosterhalfen, S.T.
  • Walter, M.
  • Fischer, G.
  • Blackburn, R.

Abstract

Rail car fleets are significant investments in the chemical industry. Therefore, chemical companies constantly try to optimize the fleets as part of major working capital optimization initiatives. We study a complex rail car fleet optimization problem observed at BASF and an approach to tackle the problem in a sequential way. We develop a mixed integer non-linear programming model to derive suggestions to the questions: (i) How many different rail car sizes in terms of volume are appropriate and what are their optimal volumes? and (ii) For each volume, what is the optimal number of rail cars of this size? The model formulation takes into account various real-world restrictions concerning the volume and weight of the rail cars as well as the tracks that they run on. We propose two solution methods. First, we reformulate the non-linear terms, which results in a mixed integer linear programming (MILP) model. This model can be solved in a reasonable amount of time, if the number of different rail car sizes is small (2 or 3). Second, we develop a two-step approach that uses an enumeration scheme in the first stage to find good initial solutions that are fed into the MILP formulation in the second stage. This approach solves the model for larger numbers of different rail car sizes (4 or 5). Through the fleet redesign BASF has realized cost savings of nearly 2 million euros so far.

Suggested Citation

  • Kallrath, J. & Klosterhalfen, S.T. & Walter, M. & Fischer, G. & Blackburn, R., 2017. "Payload-based fleet optimization for rail cars in the chemical industry," European Journal of Operational Research, Elsevier, vol. 259(1), pages 113-129.
    • Handle: RePEc:eee:ejores:v:259:y:2017:i:1:p:113-129
    DOI: 10.1016/j.ejor.2016.09.062
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0377221716308232
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ejor.2016.09.062?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. George J. Beaujon & Mark A. Turnquist, 1991. "A Model for Fleet Sizing and Vehicle Allocation," Transportation Science, INFORMS, vol. 25(1), pages 19-45, February.
    2. Cochran, Jeffery K. & Ramanujam, Balaji, 2006. "Carrier-mode logistics optimization of inbound supply chains for electronics manufacturing," International Journal of Production Economics, Elsevier, vol. 103(2), pages 826-840, October.
    3. I. Gertsbach & Yu. Gurevich, 1977. "Constructing an Optimal Fleet for a Transportation Schedule," Transportation Science, INFORMS, vol. 11(1), pages 20-36, February.
    4. Klosterhalfen, S.T. & Kallrath, J. & Fischer, G., 2014. "Rail car fleet design: Optimization of structure and size," International Journal of Production Economics, Elsevier, vol. 157(C), pages 112-119.
    5. Kochel, Peter & Kunze, Sophie & Nielander, Ulf, 2003. "Optimal control of a distributed service system with moving resources: Application to the fleet sizing and allocation problem," International Journal of Production Economics, Elsevier, vol. 81(1), pages 443-459, January.
    6. Raymond K. Cheung & Warren B. Powell, 1996. "An Algorithm for Multistage Dynamic Networks with Random Arc Capacities, with an Application to Dynamic Fleet Management," Operations Research, INFORMS, vol. 44(6), pages 951-963, December.
    7. List, George F. & Wood, Bryan & Nozick, Linda K. & Turnquist, Mark A. & Jones, Dean A. & Kjeldgaard, Edwin A. & Lawton, Craig R., 2003. "Robust optimization for fleet planning under uncertainty," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 39(3), pages 209-227, May.
    8. Avishai Ceder & Helman I. Stern, 1981. "Deficit Function Bus Scheduling with Deadheading Trip Insertions for Fleet Size Reduction," Transportation Science, INFORMS, vol. 15(4), pages 338-363, November.
    9. Kuo, Ching-Chung & Nicholls, Gillian M., 2007. "A mathematical modeling approach to improving locomotive utilization at a freight railroad," Omega, Elsevier, vol. 35(5), pages 472-485, October.
    10. Bojovic, Nebojsa J., 2002. "A general system theory approach to rail freight car fleet sizing," European Journal of Operational Research, Elsevier, vol. 136(1), pages 136-172, January.
    11. Godwin, T. & Gopalan, Ram & Narendran, T.T., 2008. "Tactical locomotive fleet sizing for freight train operations," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 44(3), pages 440-454, May.
    12. Ernest Koenigsberg & Richard C. Lam, 1976. "Cyclic Queue Models of Fleet Operations," Operations Research, INFORMS, vol. 24(3), pages 516-529, June.
    13. Felix Papier & Ulrich W. Thonemann, 2008. "Queuing Models for Sizing and Structuring Rental Fleets," Transportation Science, INFORMS, vol. 42(3), pages 302-317, August.
    14. George, David K. & Xia, Cathy H., 2011. "Fleet-sizing and service availability for a vehicle rental system via closed queueing networks," European Journal of Operational Research, Elsevier, vol. 211(1), pages 198-207, May.
    15. S. C. Parikh, 1977. "On a Fleet Sizing and Allocation Problem," Management Science, INFORMS, vol. 23(9), pages 972-977, May.
    16. Dong, Jing-Xin & Song, Dong-Ping, 2009. "Container fleet sizing and empty repositioning in liner shipping systems," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 45(6), pages 860-877, November.
    17. Peiling Wu & Joseph C. Hartman & George R. Wilson, 2005. "An Integrated Model and Solution Approach for Fleet Sizing with Heterogeneous Assets," Transportation Science, INFORMS, vol. 39(1), pages 87-103, February.
    18. Song, Dong-Ping & Earl, Christopher F., 2008. "Optimal empty vehicle repositioning and fleet-sizing for two-depot service systems," European Journal of Operational Research, Elsevier, vol. 185(2), pages 760-777, March.
    19. Vaidyanathan, Balachandran & Ahuja, Ravindra K. & Liu, Jian & Shughart, Larry A., 2008. "Real-life locomotive planning: New formulations and computational results," Transportation Research Part B: Methodological, Elsevier, vol. 42(2), pages 147-168, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sangpil Ko & Pasi Lautala & Kuilin Zhang, 2020. "Data-Driven Study on the Sustainable Log Movements: Impact of Rail Car Fleet Size on Freight Storage and Car Idling," Sustainability, MDPI, vol. 12(11), pages 1-15, June.
    2. Kirschstein, Thomas, 2018. "Rail transportation planning in the chemical industry," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 112(C), pages 142-160.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Klosterhalfen, S.T. & Kallrath, J. & Fischer, G., 2014. "Rail car fleet design: Optimization of structure and size," International Journal of Production Economics, Elsevier, vol. 157(C), pages 112-119.
    2. George, David K. & Xia, Cathy H., 2011. "Fleet-sizing and service availability for a vehicle rental system via closed queueing networks," European Journal of Operational Research, Elsevier, vol. 211(1), pages 198-207, May.
    3. Felix Papier & Ulrich W. Thonemann, 2008. "Queuing Models for Sizing and Structuring Rental Fleets," Transportation Science, INFORMS, vol. 42(3), pages 302-317, August.
    4. Bojovic, Nebojsa J., 2002. "A general system theory approach to rail freight car fleet sizing," European Journal of Operational Research, Elsevier, vol. 136(1), pages 136-172, January.
    5. Adil Baykasoğlu & Nurhan Dudaklı & Kemal Subulan & A. Serdar Taşan, 2022. "An integrated fleet planning model with empty vehicle repositioning for an intermodal transportation system," Operational Research, Springer, vol. 22(3), pages 2063-2098, July.
    6. Milenković, Miloš S. & Bojović, Nebojša J. & Švadlenka, Libor & Melichar, Vlastimil, 2015. "A stochastic model predictive control to heterogeneous rail freight car fleet sizing problem," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 82(C), pages 162-198.
    7. Vanga, Ratnaji & Venkateswaran, Jayendran, 2020. "Fleet sizing of reusable articles under uncertain demand and turnaround times," European Journal of Operational Research, Elsevier, vol. 285(2), pages 566-582.
    8. D-P Song, 2007. "Characterizing optimal empty container reposition policy in periodic-review shuttle service systems," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 58(1), pages 122-133, January.
    9. Song, Dong-Ping & Dong, Jing-Xin, 2011. "Effectiveness of an empty container repositioning policy with flexible destination ports," Transport Policy, Elsevier, vol. 18(1), pages 92-101, January.
    10. Hamid Sayarshad & Nikbakhsh Javadian & Reza Tavakkoli-Moghaddam & Nastaran Forghani, 2010. "Solving multi-objective optimization formulation for fleet planning in a railway industry," Annals of Operations Research, Springer, vol. 181(1), pages 185-197, December.
    11. José Carbajal & Alan Erera & Martin Savelsbergh, 2013. "Balancing fleet size and repositioning costs in LTL trucking," Annals of Operations Research, Springer, vol. 203(1), pages 235-254, March.
    12. Kochel, Peter & Kunze, Sophie & Nielander, Ulf, 2003. "Optimal control of a distributed service system with moving resources: Application to the fleet sizing and allocation problem," International Journal of Production Economics, Elsevier, vol. 81(1), pages 443-459, January.
    13. Mohamed Amjath & Laoucine Kerbache & James MacGregor Smith, 2024. "A Closed Queueing Networks Approach for an Optimal Heterogeneous Fleet Size of an Inter-Facility Bulk Material Transfer System," Logistics, MDPI, vol. 8(1), pages 1-38, March.
    14. Song, Dong-Ping & Earl, Christopher F., 2008. "Optimal empty vehicle repositioning and fleet-sizing for two-depot service systems," European Journal of Operational Research, Elsevier, vol. 185(2), pages 760-777, March.
    15. Dong‐Ping Song & Jonathan Carter, 2008. "Optimal empty vehicle redistribution for hub‐and‐spoke transportation systems," Naval Research Logistics (NRL), John Wiley & Sons, vol. 55(2), pages 156-171, March.
    16. Hu, Lu & Liu, Yang, 2016. "Joint design of parking capacities and fleet size for one-way station-based carsharing systems with road congestion constraints," Transportation Research Part B: Methodological, Elsevier, vol. 93(PA), pages 268-299.
    17. Kolar, Petr & Schramm, Hans-Joachim & Prockl, Günter, 2018. "Intermodal transport and repositioning of empty containers in Central and Eastern Europe hinterland," Journal of Transport Geography, Elsevier, vol. 69(C), pages 73-82.
    18. Kochel, P., 2007. "Order optimisation in multi-location models with hub-and-spoke structure," International Journal of Production Economics, Elsevier, vol. 108(1-2), pages 368-387, July.
    19. Liu, Tao & (Avi) Ceder, Avishai, 2017. "Deficit function related to public transport: 50 year retrospective, new developments, and prospects," Transportation Research Part B: Methodological, Elsevier, vol. 100(C), pages 1-19.
    20. Djurdjica Stojanović & Svetlana Nikoličić & Milica Miličić, 2011. "Transport Fleet Sizing By Using Make And Buy Decision-Making," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 56(190), pages 77-102, July – Se.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ejores:v:259:y:2017:i:1:p:113-129. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eor .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.