Chapter 13 & 14 Questions: Discuss Private Transportation

Chapter 13 & 14 Questions
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Chapter 13 & 14 Questions
1 Private transportation and private carriage
According to Coyle, Novack, Gibson, and Bardi, (2010), private transportation refers to any individual who transports in foreign or interstate commercial property of which he or she is the bailee, lessee, or owner when the transportation is meant for bailment or rent, lease, sale, or furthering any other commercial enterprise. This is a legal definition which implies that private transportation is not merely the opposite of government or public transportation, but rather a legal kind of definition transportation. In simple terms, a private transportation is deemed as the movement a firm’s goods and the firm also operates, leases, or owns the transportation equipment. Private carriers do not serve the general public, but rather serves the firm by hauling the firm’s law finished products and law materials (Coyle, Novack, Gibson & Bardi, 2010). In the past, the Interstate Commerce Commission (ICC) allowed private carriers to haul public goods without charging any fee. However, these carriers were allowed to haul public goods only when moving except commodities and when moving freight of that were fully-owned subsidiaries (Coyle, Novack, Gibson & Bardi, 2015). Unless either or both of these preconditions were met, private transportation was dedicated to serving itself by hauling its finished products and/or raw materials.
Private transportation consists of 5 different types of modes: private water, private pipeline, private air, private retail, and private trucking. Private rail transportation refers to railcars that are private owned by a shared carrier railroad. It is common among the firms that need specialized rail equipment such as temperature-controlled, tank cars, and hopper (Coyle, Novack, Gibson & Bardi, 2015). However, there is this form of transportation does not provide typical rail service in terms of transporting personnel or goods on an intercity basis. On the other hand, private air transportation refers to the fleet of private airplanes meant to provide travel services for business-related missions. In some emergency situations, these airplanes can be utilized in transporting freight. Private air transportation is more costly than commercial air transportation.
Private water transportation refers to the utilization of barges and ships that are owned or leased by the company for transporting large-volume, bulky goods including oil, ore, and coal. It is more suitable for transporting large quantities of low-value, bulk goods between limited destinations and origins. It requires a large initial capital outlay. Private oil pipeline transportation refers to shipper-owned for hire pipelines for transporting oil. Traditionally, the rationale for these pipelines stems from the need for market control. There are also economic rationales, including mitigating barriers to entry and economies of scale. Private trucking refers to company-owned truck fleet with the purpose of lowering transportation costs and/or improving service.
Private truck and air transportation are regarded to be more fuel price-sensitive than pipelines, rail, and...