Emerging delivery practices: crowdshipping and underground freight transportation

The continued growth of e-commerce and online orders has prompted the exploration of potential alternatives to traditional truck delivery that allow faster or lower-cost package delivery. This thesis evaluates the benefit of the innovative practices of crowdshipping and underground freight transportation in the last and middle mile of package delivery.

Last-mile delivery is the movement of goods from a transportation hub to their final destination. The use of crowdshipping, the gig employment of non professional couriers for last mile delivery, has been proposed as a cost beneficial and efficient alternative to traditional last-mile delivery by truck or van. We study the use of crowdshipping in urban areas where crowdshippers pick up packages at microhubs (small depots or package lockers) and carry them to their final destination. We consider two commonly used crowdshipper compensation schemes. We determine the cost of crowdshipping relative to truck delivery at which crowdshipping is cost beneficial in this setting and provide a set of insights that can help businesses decide if and when they should consider the use of crowdshipped delivery.

An alternative innovative approach to last mile delivery in urban areas is to use freight tunnels and autonomous tunnel vehicles to move goods from a depot(s) located outside of a city to neighborhood package pickup locations. The use of tunnels to transport individual orders in small tunnel vehicles has many potential benefits, such as reduced road congestion, reduced emissions, and lower delivery costs. We evaluate this problem from a planning perspective and determine where in a city the tunnel network should be built to maximize the demand delivered by tunnel. We find, using datasets from Chicago and New York City, that the use of tunnels for package delivery can reduce last mile delivery costs by as much as 70%.

Freight tunnels have also been proposed as an alternative for middle mile delivery, the movement of goods between large distribution centers in different cities. But, it is extremely expensive to construct these larger tunnels with vehicles that carry pallets of goods instead of individual orders. As such, it is important to evaluate the benefit of the network and how it can be used to improve middle mile delivery. We find that the size of tunnel vehicles has a significant impact on the amount of demand that can be delivered by its deadline, and that a larger amount of tunnel capacity can be utilized when there are more orders with short distances between origin and destination pairs. We offer managerial insights on dispatching strategies for linear middle-mile tunnel networks. For example, we show that it can be helpful to consolidate orders with the same origin, especially for small tunnel vehicle sizes, and the same origin and destination, especially with larger tunnel vehicle sizes. We conclude with many directions for future work related to this new problem area.