Overall Impacts of Off-hour Delivery Programs in the New York City Metropolitan Area: Lessons for European Cities



Overall Impacts of Off-hour Delivery Programs in the New York City Metropolitan Area: Lessons for European Cities

Authors

J Holguin-Veras, M Brom, Rensselaer Polytechnic Institute; K Ozbay, S Iyer, Rutgers University; A Kornhauser, Princeton University; S Ukkusuri, Purdue University, B Allen, KLD Associates, M A Silas, CENTRA Technology, US; W F Yushimito, Adolfo Ibáñez Univ

Description

This paper discusses the chief findings of the research conducted on policies to foster off-hour deliveries (OHD) in the New York City metropolitan area that estimated the overall impacts of an eventual full implementation of an OHD program.

Abstract

This paper discusses the chief findings of the research conducted on policies to foster off-hour deliveries (OHD) in the New York City metropolitan area that estimated the overall impacts of an eventual full implementation of an OHD program. As part of the research, the team designed a system of incentives to the receivers of deliveries, combined with remote sensing monitoring based on Global Positioning System (GPS) cellphones, to induce a shift of deliveries to the off-hours (7PM-6AM). The concept was pilot tested in Manhattan by 33 companies that switched delivery operations to the off-hours for a period of a month. At the in-depth-interviews conducted after the test, the participants reported being very satisfied with the experience. This is the first real life trial of the use of financial incentives to receivers, as an alternative to road pricing schemes that target freight carriers.

The analyses conducted by the team indicate that: (1) financial incentives to receivers are very effective in inducing a shift of receivers and carriers to the off-hours; (2) the switch of truck traffic to the off-hours brings about substantial economic benefits; (3) on average, travel speeds from the depot to the first customer in Manhattan increase from 11.8 miles/hour in the morning peak hours (6-9AM), to 20.2 in the off-hours (7PM-6AM); (4) on average, customer to customer travel speeds increase from below 3 miles per hour in the regular hours, to about 8 miles per hour in the off-hours; (5) there are substantial reductions in service times during the off-hours from a maximum of 1.8 hours per customer at 10AM, to a minimum of 0.5 hours in the night hours; and (6) travel time savings to regular hour traffic are substantial as they amount to 6% travel time reductions in Manhattan (4% if the increase in travel time during off-hours is considered). The pilot test also highlighted the great potential of unassisted OHD, i.e., OHD made without personnel from the receiving establishment present, as almost all the participants that used this modality decided to continue receiving OHD even after the financial incentive ended. Should appropriate technologies and operational procedures be designed so that large number of receivers embrace unassisted OHD, they could be implemented at a fraction of the cost of staffed OHD.
The analyses indicated that the economic benefits of a full implementation of an OHD program are in the range of $147-$193 million per year corresponding to travel time and environmental pollution savings for the regular hour traffic, and the productivity increases to the freight industry. In the case of staffed OHD, the optimal incentive amount is on the range between $10,000 and $15,000 per year, which correspond to 14%-21% of the total freight traffic. Beyond this range, the costs to receivers associated with the switch to the off-hours are much larger than the economic benefits that off-hour deliveries produce. In the case of unassisted OHD, since the receiver costs are much smaller, the optimal amount of OHD is likely to be much larger than the one for staffed OHD.

The success of this project has generated a significant amount of press as prominent publications such as the Journal of Commerce, the Wall Street Journal, Transport Topics, and numerous others, have lauded the concept as one that deserves the support of the private sector. As a result of this, the City of New York officially adopted off-hour deliveries as a center piece of a sustainability strategy.

In essence, the work done has clearly and unambiguously established that the proposed concept: (1) is effective in inducing a shift of urban deliveries to the off-hours; (2) enjoys broad based industry support; (3) would bring about substantial reductions in congestion and environmental pollution thus increasing quality of life; and (4) would increase the competitiveness of the urban economy.

Publisher

Association for European Transport