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Shared Mobility for Last-Mile Delivery: Design, Operational Prescriptions, and Environmental Impact

Author

Listed:
  • Wei Qi

    (Desautels Faculty of Management, McGill University, Montreal, Quebec, Canada H3A 1G5)

  • Lefei Li

    (Department of Industrial Engineering, Tsinghua University, Beijing 100084, China)

  • Sheng Liu

    (Department of Industrial Engineering and Operations Research, University of California, Berkeley, Berkeley, California 94720)

  • Zuo-Jun Max Shen

    (Department of Industrial Engineering and Operations Research, University of California, Berkeley, Berkeley, California 94720; Department of Civil and Environmental Engineering, University of California, Berkeley, Berkeley, California 94720)

Abstract

Two socioeconomic transformations, namely, the booms in the sharing economy and retail e-commerce, lead to the prospect where shared mobility of passenger cars prevails throughout urban areas for home delivery services. Logistics service providers as well as local governments are in need of evaluating the potentially substantial impacts of this mode shift, given their economic objectives and environmental concerns. This paper addresses this need by providing new logistics planning models and managerial insights. These models characterize open-loop car routes, car drivers’ wage-response behavior, interplay with the ride-share market, and optimal sizes of service zones within which passenger vehicles pick up goods and fulfill the last-mile delivery. Based on theoretical analysis and empirical estimates in a realistic setting, the findings suggest that crowdsourcing shared mobility is not as scalable as the conventional truck-only system in terms of the operating cost. However, a transition to this paradigm has the potential for creating economic benefits by reducing the truck fleet size and exploiting additional operational flexibilities (e.g., avoiding high-demand areas and peak hours, adjusting vehicle loading capacities, etc.). These insights are insignificantly affected by the dynamic adjustment of wages and prices of the ride-share market. If entering into this paradigm, greenhouse gas emissions may increase because of prolonged car trip distance; on the other hand, even exclusively minimizing operating costs incurs only slightly more emissions than exclusively minimizing emissions.

Suggested Citation

  • Wei Qi & Lefei Li & Sheng Liu & Zuo-Jun Max Shen, 2018. "Shared Mobility for Last-Mile Delivery: Design, Operational Prescriptions, and Environmental Impact," Manufacturing & Service Operations Management, INFORMS, vol. 20(4), pages 737-751, October.
    • Handle: RePEc:inm:ormsom:v:20:y:2018:i:4:p:737-751
    DOI: 10.1287/msom.2017.0683
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