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Dynamic Inventory Routing and Pricing Problem with a Mixed Fleet of Electric and Conventional Urban Freight Vehicles

Author

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  • Hamid R. Sayarshad

    (Robert A. Foisie School of Business, Worcester Polytechnic Institute, Worcester, MA 01609, USA
    Department of Research and Development, Optywar Company, Irvine, CA 92612, USA)

  • Vahid Mahmoodian

    (Industrial & Management Systems Engineering, University of South Florida, Tampa, FL 33620, USA)

  • Nebojša Bojović

    (Faculty of Transport and Traffic Engineering, University of Belgrade, Vojvode Stepe 305, 11000 Belgrade, Serbia)

Abstract

Urban freight transport is essential for supporting our society regarding providing the daily needs of consumers and local businesses. In addition, it allows for the movement of goods, is distributed within urban environments, provides thousands of jobs, and supports economic growth. However, a number of issues are associated with urban freight transport, including environmental impacts, road congestion, and land use of freight facilities that conflicts with residential land use. Electric freight vehicles create zero emissions and provide a sustainable delivery system in comparison with conventional freight vehicles. In this study, a novel dynamic inventory routing and pricing problem under a mixed fleet of electric and conventional vehicles was formulated to minimize the total travel and charging costs. The proposed model is capable of deciding on replenishment times and amounts and vehicle routes. We aimed to determine the maximum social welfare (SW) capable of providing an optimal trade-off between the supplier cost and customer delay that uses a mixed fleet of vehicles. Our computational study was conducted on real data generated from a delivery dataset in Tehran. Under the proposed policy with a fleet of only electric vehicles, the SW increased by 3% while the average customer delay reduced by 15% compared with a fleet of conventional vehicles. The results show that the number of served customers and customer delay would be affected by transitioning conventional urban freight vehicles to electric vehicles. Therefore, the proposed delivery system has a significant impact on energy savings and emissions.

Suggested Citation

  • Hamid R. Sayarshad & Vahid Mahmoodian & Nebojša Bojović, 2021. "Dynamic Inventory Routing and Pricing Problem with a Mixed Fleet of Electric and Conventional Urban Freight Vehicles," Sustainability, MDPI, vol. 13(12), pages 1-16, June.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:12:p:6703-:d:574115
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