Collaboration for Truckload Carriers

Because of historically high fuel prices, the trucking industry’s operating expenses are higher than ever, and thus profit margins lower than ever. To cut costs, the trucking industry is searching for and exploring new ideas. We investigate the potential of collaborative opportunities in truckload transportation. When carriers serve transportation requests from many shippers, they may be able to reduce their repositioning costs by exchanging one or more of them. We develop optimization models to determine the maximum benefit that can be derived from collaborating, and we develop various exchange mechanisms, differing in terms of information sharing requirements and side payment options, which allow carriers to realize some or all of the costs savings opportunities.