Maritime Logistics

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Course: Bachelor of Business (Maritime and Logistics Management)

The following article follows the case of a German company, Nurnberg Augsburg Maschinenwerke and an order, of buses, from a group of Brazilian authorities dealing with the improvement of the local public transportation. The best and most viable routes are to be decided upon for the delivery of these buses to Santos. A condition was given for 25 buses to be shipped initially.

Table of Contents

Contents Page
Table of Contentsiii
Geographical Map2
Question 13-4
Transportation System in Germany5
The Port of Rotterdam and the Port of Hamburg6
Conclusion for Question 17
Question 28
Question 39
Question 410

Nurnberg Augsburg Maschinewerke (N.A.M) is a German manufacturing company and one of the most successful in Germany. The company is located in Munich, Germany (). It deals with heavy truck and bus designs, engineering and manufacturing. In August 2003, N.A.M received an order from a group of local authorities from Brazil. The Brazilian authorities were involved with the upgrading of the local public transportation systems in both the cities of Sao Paulo and Rio de Janeiro.

The details of the order requested were for 244 N.A.M class #4-G two-section articulated buses. However, a condition was set in place where 25 buses were first to be delivered to Santos, the port of Sao Paulo, within 3 months. If this condition was met, then N.A.M will get the contract for the rest of the 199 vehicles.

N.A.M’s Prague factory was selected to produce the first 25 buses as the Prague factory had just completed manufacturing an order of #4-G buses and owing to an order cancellation would only be working at 70% productivity to year-end. N.A.M predicted the completion of the first 25 buses within 8 weeks.

Details of alternate delivery routes

1) Transportation Information (Train from Prague)

| Bremerhaven| Hamburg| Rotterdam|
Geographic Distance| 550,000 km| 490,000km| 640,000km|
Transit Time| 3 days| 3days| 4~5 days|
Cost-2 Buses| | €1643/flatcar| €1943/flatcar|
Unloading Cost| | €45/bus| €45/bus|
Loading Cost (First 20)| | €25/bus| €25/bus|
Loading Cost (Over20)| | €40/bus| €40/bus|

2) Transportation Information (Waterway from Prague)

| Bremerhaven| Hamburg| Rotterdam|
Transit Time| -| 6 days| -|
Cost| -| €48 less/bus| -|

3) Transportation Information (Ship to Santos, Brazil)

| Bremerhaven| Hamburg| Rotterdam|
Transit Time| 18 days| 18 days| 17 days|
Cost| €6000/bus| €6000/bus| €5700/bus|
Unloading Cost| €94/bus| €94/bus| €94/bus|
Possible Departing dates| | 24/10, 27/10,31/10| 23/10,28/10,02/11|

Figure 1
Geographical Map

Source: Geology, 2010.

Question 1

Which of the routing alternatives would you recommend to meet the initial 90-day deadline for the 25-bus shipment? Train or waterway? To which port(s)? What would it cost?

Firstly, the several possible routes that can be used to transport the buses are:

1) Prague-Hamburg (Train)-Santos(Ocean)
2) Prague-Rotterdam (Train)-Santos(Ocean)
3) Prague-Hamburg (Waterway)-Santos(Ocean)

Bremerhaven cannot be considered as the carriers, Hapaq-Lloyd, do not provide any vessels to that port during the needed period of dates.

Route 1
Prague-Hamburg (Train)-Santos (Ocean)

This route will involve conveying the cargo to the port of Hamburg via the railway. The price of the railway will be €1643 per flatcar, which equates to €21,359 for 25 buses.

Price per flatcar: €1643 per 2 buses
No of flatcars: (25/2) =12.5≈13 flatcars to be used
Total flatcar price: €1643x13= €21,359....
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