Dynamic Model for System-Level Strategic Intermodal Facility Investment Planning

Abstract

This paper proposes a scenario-based mixed-integer dynamic capacitated intermodal facility location model (IFLM) for determining the optimal strategic intermodal facility investment planning strategy that accounts for freight transportation demand uncertainty. The proposed model helps high-level policy makers with strategic investment planning for intermodal facilities at a regional or national level and fosters coordinated strategies and policies for intermodal facility development from a systems perspective. A scenario-based approach characterizes demand uncertainty induced by global trade changes and emerging infrastructure development projects. Dynamic demand is incorporated into the model to capture the impact of differences in the evolution of various scenarios on system-level strategic intermodal investment planning. The proposed IFLM captures the impact of congestion, transshipment costs, changes in capacity of intermodal facilities, economies of scale, and empty-container repositioning costs on freight transportation demand and strategic intermodal investment planning. Three numerical experiments demonstrate the applicability of the proposed model and explore the impacts of intermodal facility service-level changes of some regions on the freight transportation demand for other regions and the optimal intermodal investment planning strategy in the United States. The results show that the proposed model can help decision makers in strategic intermodal facility investment planning by prioritizing capacity expansion of ports and terminals. The results also illustrate the importance of system-level and coordinated planning in strategic intermodal investment in the decision-making process. The proposed IFLM can be integrated with operational planning models to improve investment decision making.