Analyzing the diffusion of eco-friendly vans for urban freight distribution

• DOI: https://doi.org/10.1108/IJLM-05-2016-0123
• Published date: 13 November 2017
• Pages: 1218-1242
• Date: 13 November 2017
• Author: Anna Corinna Cagliano,Antonio Carlin,Giulio Mangano,Carlo Rafele
• Subject Matter: Management science & operations,Logistics

Analyzing the diffusion

of eco-friendly vans for

urban freight distribution

Anna Corinna Cagliano, Antonio Carlin, Giulio Mangano and

Carlo Rafele

Department of Management and Production Engineering,

Politecnico di Torino, Torino, Italy

Abstract

Purpose –The purpose of this paper is to investigate the diffusion dynamics of electric and hybrid

commercial vans and its enabling factors in the city logistics (CL) contexts. The case of parcel delivery in

Torino, Italy, is considered. Attention is paid to the influence on the choice of low impact vehicles of not only

public strategies but also operational aspects characterizing urban freight distribution systems.

Design/methodology/approach –A System Dynamics model based on the Bass diffusion theory computes

the number of adopters of low-emission vehicles together with the quantity of vans required and the associated

economic savings. The model includes variables aboutfreight demand, delivery frequency, van carrying capacity,

routes, stops, distances traveled, and vehicle charging stations. A sensitivity analysis has been completed to

identify the main diffusion levers. The focus is on advertising and other drivers, such as public contributions,

taxes traditional polluting vehicles are subjected to, as well ason routing optimization strategies.

Findings –Advertising programs, green image, and word-of-mouth drive market saturation, although in a

long time period. In fact, low-impact vehicles do not offer any economic advantage over traditional ones

requiring higher investment and operating costs. Public incentives to purchase both green vehicles and

charging stations, together with carbon taxes and a congestion charge affecting polluting vehicles, are able to

shorten the adoption time. In particular, public intervention reveals to be effective only when it unfolds

through a number of measures that both facilitate the use of environmentally friendly vehicles and discourage

the adoption of traditional commercial vans. Route optimization also hastens the complete market saturation.

Research limitations/implications –This work fosters research about the mutual relationships between

the diffusion of low-emission commercial vehicles and the operational and contextual CL factors. It provides a

structured approach for investigating the feasibility of innovative good vehicles that might be part of

assessments of CL measures and requirements. Finally, the model supports studies about the cooperation

among stakeholders to identify effective commercial vehicle fleets.

Practical implications –This study fosters collaboration among CL players by providing a roadmap to

identify the key factors for the diffusion of environmentally friendly freight vehicles. It also enables freight

carriers to assess the operational and economic feasibility of adopting low-impact vehicles. Finally, it might

assist public authorities in capturing the effects of new urban transportation policies prior to their

implementation.

Originality/value –Most of the current CL literature defines policies and analyzes their effects. Also, there

are several contributions on the diffusion of low emission cars. The present study is one of the first works on

the diffusion of low-impact commercial vehicles in urban areas by considering the associated key operational

factors. A further value is that the proposed model combines operational variables with economic and

environmental issues.

Keywords System dynamics, Sensitivity analysis, City logistics, Diffusion model,

Electric and hybrid commercial vehicles

Paper type Research paper

1. Introduction

In recent years, problems caused by the increasing freight transportation demand within

cities, such as congestion and pollution, have led both researchers and public

administrations to concentrate their efforts on city logistics (CL) initiatives. CL fosters the

The International Journal of

Logistics Management

Vol. 28 No. 4, 2017

pp. 1218-1242

© Emerald PublishingLimited

0957-4093

DOI 10.1108/IJLM-05-2016-0123

Received 21 May 2016

Revised 15 November 2016

Accepted 10 January 2017

The current issue and full text archive of this journal is available on Emerald Insight at:

www.emeraldinsight.com/0957-4093.htm

The authors would like to thank the partners of the “PIE VERDE”project, and in particular the project

leader Iveco S.p.A., for the collaboration and the information provided during the present research.

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IJLM

28,4

development of integrated logistics systems, where all the stakeholders are coordinated so

that to reduce the negative impacts on citizens. In this context, freight carriers play an

important role, since they carry out the core tasks of the CL process meaning delivering

goods (De Marco et al., 2014; Lam and Dai, 2015).

The daily activities of freight carriers can be heavily influenced by initiatives that aim to

reduce the negative impacts of urban logistics operations. Such projects are often associated

with access restrictions of some areas of a city or congestion charges. Additionally,

initiatives related to the partial or total substitution of existing commercial vehicles with low

emission ones are very interesting since compared with the ones previously mentioned they

do not significantly impact the organization of logistics activities and they are also able to

effectively complete an entire route with their current existing battery operating time

(Elvsaas et al., 2015). Furthermore, non-fossil fuels renewable energy sources may be

considered as a viable alternative for logistics managers who have to face environmental

issues, without blowing costs up (Rogers et al., 2007). Nevertheless, in order to make

low-impact vehicles appealing, it is necessary to deeply understand the main factors for

their adoption. However, current literature mainly focuses on defining CL policies and

analyzing their effects, but it lacks studies that investigate the diffusion of low-emission

commercial vehicles by addressing the operational aspects of the associated logistics

systems ( Jfeng et al., 2008; Vafa-Arani et al., 2014).

Aiming at exploring the conditions supporting the diffusion of low-impact vans for

carrying out CL activities, this study proposes a System Dynamics (SD) model that assesses

the potential diffusion of electric and hybrid (diesel and electric power) vans in the city of

Torino (Italy), by taking into account the main operational factors affecting freight

distribution systems. The results of the simulation and the consequent sensitivity analysis

allow to identify some factors that might drive the adoption of electric and hybrid

commercial vehicles. The present work is part of the “PIE VERDE”regional research project

carried out by a consortium of academic and industrial partners including a main

commercial vehicle manufacturer, a logistics service provider (LSP), and companies in the

automotive, mechanics, electronics, information technology, automation, and energy sectors.

The project’s ultimate goal is to develop innovative low-emission vehicle solutions as well as

the associated logistics networks in the field of urban freight distribution in a business-to-

business (B2B) environment.

The SD methodology (Forrester, 1961) was used given its proven ability to represent and

simulate the behavior of complex systems like CL ones that involve a lot of factors and

stakeholders, such as governments, companies, citizens, and carriers, that interact with each

other (Koc et al., 2016). The model was developed based on the review of similar case studies,

interviews with the main stakeholders in the supply chain (SC) under study, as well as

detailed data on the characteristics of the vehicles.

The paper is structured as follows. An overview of the pertinent literature is presented in

Section 2. Section 3 describes the methodology, while the development of the model is

presented in Section 4 and its calibration is proposed in Section 5. The results of the

simulations and of the sensitivity analysis together with their interpretation are discussed in

Section 6. Finally, the study implications, future research, and conclusions are given

in Section 7.

2. Literature review

2.1 Green logistics and low emission vehicles

In recent years, the demand for responsible and green transportations has been risen

(Wolf and Seuring, 2010) and the concept of green logistics is now encompassing different

categories. The most important ones are fuels (use of biofuels instead of fossil fuels), modal

choices (shift from air to ocean, from road to rail), logistics system design and transport

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Urban freight

distribution