• DTS.USA
    5.320
    -0.013
    -0.2%
  • NTI.USA
    2.800
    0.000
    0%
  • NTID.USA
    2.760
    -0.100
    -3.5%
  • NTIDL.USA
    1.940
    -0.100
    -4.9%
  • OTRI.USA
    6.190
    0.010
    0.2%
  • OTVI.USA
    12,391.500
    -166.900
    -1.3%
  • DTS.USA
    5.320
    -0.013
    -0.2%
  • NTI.USA
    2.800
    0.000
    0%
  • NTID.USA
    2.760
    -0.100
    -3.5%
  • NTIDL.USA
    1.940
    -0.100
    -4.9%
  • OTRI.USA
    6.190
    0.010
    0.2%
  • OTVI.USA
    12,391.500
    -166.900
    -1.3%
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FreightWaves Classics: Drayage is first-mile logistics (Part 2)

As noted in Part 1 of “Drayage is first-mile logistics,” while the drayage function has been around for hundreds of years, its importance has grown significantly in the past 70 years, following the introduction of the shipping container by Malcom McLean and his Sea-Land Corporation.

Crowley operates a fleet of nearly 5,000 reefer containers. [Photo: Crowley Maritime]
Crowley operates a fleet of nearly 5,000 reefer containers. (Photo: Crowley Maritime)

Specialized drayage

Cargo comes in different sizes, shapes and temperature requirements. Some cargo may be temperature-sensitive, requiring packing in refrigerated containers. Some cargo is out-of-gauge, or OOG. OOG cargo typically does not fit inside a standard container.

While the majority of cargo is packed from international departure points in either 20-foot or 40-foot containers (also known as general-purpose containers, or GP containers), other cargo needs special equipment such as a flat rack, open-top, high-cube, or a refrigerated container. Professional drayage operators are usually equipped to meet such requirements. 

One of the trucks in the Neill Cartage fleet. (Photo: Neill Cartage)
One of the trucks in the Neill Cartage fleet. (Photo: Neill Cartage)

Differences between drayage and cartage

Drayage and cartage are both key steps in a supply chain. They are both used to move goods over short distances. Although drayage and cartage refer to somewhat similar activities – the transfer of goods for a short-haul journey – the primary difference between the two has to do with the container. Both methods have their advantages and disadvantages.

When a drayage pickup is scheduled, a full container is transferred directly onto a chassis for a short-haul trip. Cartage involves taking goods out of a container and separating its contents  into smaller units and then transporting them by road to locations within a metropolitan area.

So, in summary, drayage is the transport of containers, while cartage usually involves break-bulk cargo. Therefore, while drayage is limited to a chassis truck, cartage may use different vehicles (depending on the cargo) – from vans to box trucks to semi-trucks. Drayage means less handling of goods, while cartage is synonymous with transloading.

Loading a container on a drayage truck. (Photo: roadone.com)
Loading a container on a drayage truck. (Photo: roadone.com)

As pointed out in Part 1, there are various types of drayage as defined by the Intermodal Association of North America (IANA). There are no such distinctions or classifications in cartage.

Drayage services are used for short and efficient hauls. A chassis truck, which is a special flatbed that shipping containers are loaded directly onto, picks up a container at one destination and hauls the freight a short distance (no more than 250 miles, but often much shorter). 

Once the freight arrives at one of these supply chain checkpoints, the drayage service is completed. 

Elements of cartage

Cartage can be used as either a freight shipment or as a connecting movement within a supply chain. These are less-than-truckload (LTL) shipments since they likely won’t fill an entire truckload once the container contents are distributed among several vehicles. 

In drayage, there is usually a bill of lading that accompanies a container. The bill of lading contains key information that allows the shipper and receiver to account for the shipment as well as to track the shipment from the point of source to the point of delivery. 

A source that provided information for this article. 
(Photo: usatruckloadshipping.com)
A source that provided information for this article.
(Photo: usatruckloadshipping.com)

When using cartage, the usual document is a cartage advice, which is a legal document that details the type, quantity and destination of the goods being transported. The cartage advice can also act as a receipt. The cartage advice must be with the cargo being moved, and it must be signed by the receiver as proof that the shipment was received.

In addition, when cartage is used there is a cartage agent involved. This agent uses paperwork and forms to identify and ship the cargo. For example, a drayage driver who has delivered a container from a seaport to a warehouse will have documents created by a freight forwarder or another party handling the container. After the delivery and the cargo is removed from the container, a cartage agent will develop another set of documents to make sure the cargo is delivered to the correct receiver.

Cartage is very useful in large, heavily populated metropolitan areas. However, cartage has two minor flaws – one of which can be easily navigated, while the other is simply part of the process. 

The first flaw is that cartage requires increased freight handling. Cartage involves transloading, and the more freight is handled, the more risk there is for damage or loss. The second is that cartage requires an increased number of drivers. After cargo is removed from the original container and broken down into separate shipments, these shipments will be LTL. They will share space on a number of trucks with other merchandise. 

To many, the differences between drayage services and cartage services are very subtle. In summary, the major difference between the two services is that drayage moves an entire container a short distance so that it can continue its journey, while cartage breaks a container shipment down into multiple loads to be transported.

This illustration shows the benefits of cross docking. (Image: nebraskawarehouse.com)
This illustration shows the benefits of cross docking. (Image: nebraskawarehouse.com)

Differences between drayage and cross docking

As noted previously, drayage is the process of moving freight by road network over short distances as part of the supply chain. The process of offloading freight from one mode of transport directly to an outbound transportation mode without storage is known as cross docking.

Additionally, while drayage is a link in the intermodal shipping process, cross docking is a form of intermodal shipping that is direct, and no drayage is required.

Ships at anchor, waiting to offload their cargo. (Photo: Jim Allen/FreightWaves)
Ships at anchor, waiting to offload their cargo. (Photo: Jim Allen/FreightWaves)

Intermodal shipping

Prior to Malcom McLean’s use of the modern shipping container, virtually all cargo was break-bulk cargo that was loaded and unloaded by hand. Using intermodal shipping containers, the cost and time to move cargo dropped significantly. With intermodal shipping, cargo is loaded into intermodal containers, and these containers are able to move seamlessly between various modes of transportation.

McLean’s first container ship was designed to help move more goods faster than long-haul trucking or rail alone could move them. When the first container ships were built, they moved cargo along the U.S. Eastern seaboard to other U.S. ports. Standard-sized containers were loaded in one port and offloaded in another. Now, ships arrive at ports around the world loaded with containers that need to be quickly unloaded, put onto a chassis, and hauled to the next point in their journey.

Modern intermodal shipping uses multiple shipping modes (such as ship, truck and rail) to transport cargo from its origin to the final destination. As cargo containers move between different transportation modes, there is a need to unload, shift and load the container cargo.

A train hauling intermodal containers travels on a bridge.
An intermodal train. (Photo: Jim Allen/FreightWaves)

Drayage is the essential link in the supply chain system between any two or more modes of transportation. Drayage allows companies to ship their products in a more cost-effective manner over longer distances. It is usually accomplished using trucks via the road system.

According to the IANA, up to 95% of all globally manufactured goods travel in a container at some point. Drayage services connect containers of freight from one intermodal point to another. 

Intermodal drayage remains essential because it moves cargo from ports to distribution points as quickly as possible. McLean’s (and then others’) modern container ships reduced shipping costs so dramatically that intermodal drayage became even more important to the process of  keeping goods flowing.

Pacific Drayage Services was named to EPA’s SmartWay High Performer list. (Photo: imccompanies.com)
Pacific Drayage Services was named to EPA’s SmartWay High Performer list. (Photo: imccompanies.com)

Changes in drayage in the last 50 years

Back when dray horses and carts were used, the primary environmental concern was who was going to shovel up the horse droppings. Today, the push to cut carbon emissions has led drayage companies to meet ever-more strict environmental standards while still delivering goods on time. 

The SmartWay Drayage Program seeks to improve the environment around ports. A program developed by the Environmental Protection Agency, Environmental Defense Fund and Coalition for Responsible Transportation, the SmartWay Program wants all port industries to contribute to improving air quality. 

A drayage truck is a large semi-trailer truck used for transporting goods from one location to another. In their earliest iterations, drayage trucks were powered by gasoline. Then drayage (and almost all heavy-duty trucks) began to use diesel fuel because of its advantages over gasoline. These heavy-duty trucks have been used to transport containers and bulk freight between port and intermodal rail facilities, distribution centers and other locations.

Newer trucks produced fewer emissions. But more rigorous clean air mandates have led to drayage trucks at some ports to use electric, natural gas and other alternate forms of energy. Regulatory agencies and the industry are working together to reduce particulate matter and nitrous oxide emissions. 

Embark Trucks is coordinating the use of BYD Class 8 electric trucks for the drayage portion of Los Angeles to Phoenix runs for HP Inc. (Photo: Embark Trucks)
Embark Trucks is coordinating the use of BYD Class 8 electric trucks for the drayage portion of Los Angeles to Phoenix runs for HP Inc. (Photo: Embark Trucks)

Another major change in the drayage industry has come about because of improvements in computing technology. Computerized drayage management systems help track cargo from the time it leaves a ship until final delivery. 

For many drayage customers, It is critically important to be able to provide proof of delivery or the status of a shipment. The use of warehouse management systems (WMS) help ensure accuracy. The best drayage companies can pinpoint the location of an item – whether it is on a truck or in a warehouse, providing customers with end-to-end visibility of their cargo during drayage.

While visibility has always been important, it has been increasingly essential over the past couple of years. Better technology allows businesses to track products accurately through the supply chain and provides predictive capabilities. (Photo: Shutterstock)
While visibility has always been important, it has been increasingly essential over the past couple of years. Better technology allows businesses to track products accurately through the supply chain and provides predictive capabilities. (Photo: Shutterstock)

Summary

Shipping freight is a complex process. Drayage is an essential logistics industry service and part of a more complex logistics process that keeps supply chains operating.

Every cargo movement from point of origin to final destination involves several drayage movements. Drayage is one of the modes of transport in a typical freight shipping process. It provides the necessary link in the supply chain that spells the success of multimodal transport. 

According to FreightWaves research, the truckload and private truckload segment of freight transportation contribute over $725+ billion to the U.S. economy. In 2020, the intermodal freight market worth was an estimated $25.2 billion. 

By value, vessels carry 53% and 38% of U.S. imports and exports, respectively. This is larger than any other transportation mode. Whether goods are coming into or leaving the U.S., they need to be moved to a port or moved from a port. Therefore, drayage is a vital piece of the freight and logistics puzzle.

Among the sources used for this FreightWaves Classics article were: ABCO, AsianUSA, BansarChina, BOA Logistics, Envase, FMI, FreightRight, Globecon Freight, Icontainers, InTek Freight & Logistics and Marine Insight. Thanks to each of these companies for the information provided.

Drayage trucks outside APM Terminal's Pier 400 at the Port of Los Angeles. (Image: Jim Allen/FreightWaves)
Drayage trucks outside APM Terminal’s Pier 400 at the Port of Los Angeles. (Photo: Jim Allen/FreightWaves)

The FREIGHTWAVES TOP 500 For-Hire Carriers list includes Crowley (No. 204).

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Scott Mall

Scott Mall serves as Managing Editor of FreightWaves Classics. He writes articles for the website, edits the SONAR Daily Watch series, marketing material for FreightWaves and a variety of FreightWaves special projects. Mall’s career spans 45 years in public relations, marketing and communications for Fortune 500 corporations, international non-profits, public relations agencies and government agencies.