LA CAZA DE BRUJAS DE SALEM: CREACIÓN DE UN MITO 1. Fuentes primarias

This section provides the general outlook of the UK logistics industry, including the industry structure, functions and trends, as well as key issues associated with sustainable development of the industry in the future.

2.4.1 Industry Structure Overview

The UK‟s logistics market is regarded as one of the most mature in the world, with sophisticated operations developed over the last twenty years in line with the evolving needs of customers. The domestic market has become dominated by a handful of logistics giants, and consolidation is continuing, led by demand-side initiatives such as factory gate pricing (Transport Intelligence, 2005).

The logistics market is currently dominated by road transport. In 2008, road haulage accounted for 67% of tonnes moved, and 83% of tonnes lifted in Great Britain²(DfT, 2009a). Rail freight has increased its share of goods moved in recent years, and is still the major mode for the movement of coal and coke; while waterborne transport continues to dominate the movement of petroleum products.

2 Aviation is excluded in the calculation.

As far as road freight is concerned, UK goods vehicles‟ activities totalled 163.5 billion tonne-km in 2008, when HGVs moved 157.1 billion tonne-km of goods. 68%

of the market share is held by public haulage and 32% by own-account operation (DfT, 2009a). Statistics on types of goods carried by goods vehicles highlighted several sectors as major markets; including food, drink and tobacco; crude minerals;

building materials; tools, machinery and equipment; paper, mail and parcels; and miscellaneous commodities (DfT, 2009a; DfT, 2007e; DfT, 2005e).

2.4.2 Functions and Dynamics within the Industry

The functioning of the logistics industry is highly subject to the implications of a set of critical factors and the role played by the government. Fuel cost, for instance, which constitutes about one third of HGV operating cost and is largely determined by world oil price and fuel duty, has substantial impacts on logistics operations.

Although the fluctuation of oil prices reflects the macroeconomic environment and political status of critical regions, over which the industry has little control, fuel duty has been employed as a fiscal instrument by the government with direct impact on freight transport, in particular road sector.

As a sector with on average a low operating margin (around 4% as reported in Motor Transport Top 100 in 2010), road freight generally has its focus on cost reduction and efficiency improvement initiatives, and passes the rising operating costs on to its customers where possible. However, the strong bargaining position of many customers meant that the costs could not always be passed on in full (FTA, 2011). It is also reported that during the economic downturn, the business investment into new vehicles was largely scaled back, resulting in prolonged vehicle lives.

Interaction between the industry and the government has multiple dimensions. In addition to fuel duty, the industry relies heavily on the government‟s budget for the investment in transport infrastructure, including local roads and motorways, to address congestion and capacity issues (Eddington, 2006). The government also impacts on the logistics industry through policy making in areas such as road pricing (e.g. Lorry Road User Charging – LRUC proposed in the Coalition Agreement), aviation tax, and its prioritisation of low carbon transport projects.

2.4.3 Company Behaviour Patterns

Like studies in the public transport sector, where individual behaviour is a critical factor, requiring close examination in order to mobilise behaviour change, research into the logistics industry should have its focus on the behaviour pattern of its main actors – companies with logistics operations. It is revealed that a fundamental reason for the continuous occurrence of unintended effects and unattained environmental targets may be that little attention is given to behavioural aspects and social processes during sustainability policy making (Himanen et al., 2005).

Murphy and Poist (2003) carried out empirical research comparing US and non-US firms regarding environmental issues in logistics management. The non-US firms targeted in this survey are from Canada and Western Europe, so the comparison was made between highly industralised countries sharing many commonalities in business culture. Based on the chi-square test results for 6 selected propositions, the study reveals a fairly high degree of similarity between US and non-US firms with respect to their perspectives and practices in green logistics. It shows that most companies are still pursuing a reactive rather than proactive approach to green logistics and viewing it as a tactical rather than a strategic issue. This observation is

reinforced by two other surveys among the UK companies (Ghobadian et al., 1995;

Dahlmann et al., 2008) which also discovered that bottom line concerns appear to be paramount in guiding corporate behaviours.

Given that countries at different stages of economic development have different natures, representing the evolution of environmentalism, such a “comparative logistics” study can also be applied between developing and developed countries, or further explored with respect to various spatial, temporal/historical and sectoral aspects (Hartley, 1972). Thus, updated empirical studies would be desirable to identify changing company behaviour patterns and their links with geographical location, national characteristics or industry sectors.

2.4.4 Major Logistics Trends

2.4.4.1 Economic Growth Patterns – Decoupling and Recoupling

In the past few decades, the growth of logistics activities has been seen as a highly correlated trend to the growth of the British economy (see Figure 2.7), demonstrating a high level of interdependence between them. Such a relationship had long been regarded as a virtuous circle, until the adverse environmental impact of logistics activities received unprecedented attention in recent years. In 1997, the decoupling point of road freight transport and domestic economic growth was first observed, and since then the link had been gradually weakening (DfT, 2004a), which seems indicate a movement towards sustainable logistics. However, there were few signs of a full breakdown in this unsustainable relationship (Schipper and Fulton, 2003).

Furthermore, McKinnon (2007a) argued that the net environmental benefits are likely to be minor once the allowance is given to foreign trucks, vans lighter than 3.5

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tonnes, and other transport modes which were excluded from the analysis. A recent update of the linkage revealed that GDP and freight tonne-km trends appear to have been “recoupling” since 2007.

Figure 2.7: Trends in GDP, domestic freight transport km and road freight tonne-km (index 1990=100): UK 1990-2009

Source: DfT, 2010

A backcasting study has been conducted by Akerman et al. (2006) trying to assess a potential pathway towards future sustainable transport in Sweden. Given the established target of stabilising the concentration of CO2 in the atmosphere at 450 ppm (parts per million) by 2050, the present technological developments in improving fuel efficiency and reducing energy use in transport were summarised in the study. On this basis, assumptions were made that technical potential would be realised, and that energy intensity would be approximately halved by 2050. However, the study revealed that even with such substantial energy efficiency achieved, when combined with present transport volume and its growth forecast by 2050, it is not possible to reach a fully sustainable transport system. They concluded that only a combination of much improved technology and a transport volume similar to the level in 2000 would come close to reaching the target.

Although their research is based on the Swedish scenario, the same approach could be applied to any other country. With the larger transport volume and faster growth rate observed in UK, the scenario would only be more severe, and require a greater magnitude of institutional changes, rather than incremental ones. Therefore, putting a curb on the growth of transport, while seeking solutions for low-carbon operation at the same time, should remain firmly on the agenda of sustainable development.

2.4.4.2 Outsourcing

Externalisation of non-core business activities, so as to concentrate resources on more competitive operations, has been a significant trend since the 1980s. With logistics operations traditionally functioning as a supportive rather than a profit-generating part of a business, it is not surprising that 59% of the 300 companies surveyed by PE Consulting (1998) in 1996 did not regard it as a core activity. A more recent survey, conducted in 2005 among manufacturing and retail companies, reinforced the trend towards third party logistics (3PL) by revealing that 79% were currently using contractors for their logistics operations (EyeforTransport, 2005).

The upward trend of outsourcing is more evident in the UK. In financial terms, having the highest percentage (34%) of logistics expenditure contracted out in the EU in 1996, the UK was predicted to have 37% of its total logistics outsourced by 2002, compared with an average 28% in the EU (McKinnon, 1999). In terms of road freight lifted, the latest statistics published by DfT (2009a) indicate the share of „hire and rewards‟ operation increased from 50% in 1980 to 57% in 2008. Especially regarding the transformation of contractors from providing basic logistics services like transportation and warehousing with a slim profit margin, to premium, value-added and integrated logistics services, a leading role that the 3PL/4PL providers are

increasingly playing is reflected in ongoing structural changes since the last decade, such as the globalisation of logistics operation, wide application of information and communication technology (ICT) in supply chain management, and acquisitions and mergers being commonplace in the industry.

Generally, the trend of outsourcing is considered as being a move in the right direction towards sustainability. The connection is often ascribed to the competitive advantages of 3PL providers whose capacity is acquired from strategically bundled resources such as physical, technology, human and knowledge resources (Wong and Karia, 2009). These tend to allow more operationally and environmentally efficient opportunities to be exploited. As an industry, logistics was recognised as a service providing sector in the late 1980s, with the growing emergence of 3PLs (Sheffi, 1990). Consequently, the implications of logistics outsourcing, its impact on economic, operational and environmental performance, together with increasingly dynamic interactions between logistics service providers (LSPs) and users (LSUs) have since been explored in research (for recent studies see Marasco, 2008; Gadde and Hulthen, 2009; Hsiao et al, 2010).