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What is Multimodal Transportation

Updated: Jun 28, 2021

Multimodal Transport

Multimodal transport (or combined transport) is per definition a combination of at least two or more different modes to move your cargo from a place in one country to another country. The main characteristic of multimodal transport is that even though it includes different kinds of modes of transportation, it still falls under one single B/L. That means the carrier is fully liable for the entire carriage even though it is performed by different modes of transport such as Air, Rail Road, or Sea. When using intermodal shipping, each leg of that shipment will be handled by a separate company.

Neptune Logistics is committed to China, the CIS region, and Europe's rail transport and international transport, including international rail transport, sea and rail transports, steam and rail transports, air transports, and so on. Through the integration of cross-border integrated logistics resources, customers are provided with one-stop services for transporting goods from one country's domestic takeover sites to designated delivery locations within another country. Mainly includes Chinese port, Russian, Mongolia, Central Asia five countries and other countries bordering China by land cross-border intermodal transport routes.

Multimodal transport is a unique service project for Neptune Logistics. For 19 years, Neptune Logistics has operated many multimodal transport projects with a professional team and rich experience. With a single multimodal transport contract with Neptune, we offer you an intermodal transport and mode of transportation solution to ensure your cargo goes from origin to destination where each leg will be handled with a single carrier. You don't have to worry about the process, we handle that for you by mode of shipment selection and carrier selection.

International multimodal transport concept

International multimodal transportation refers to an international transport mode in which the multimodal transportation operator is responsible for transporting the goods from the receiving place in one country to the designated place in another country to deliver the goods in at least two different transport modes according to the multimodal transportation contract. The necessary conditions for international multimodal transport are as follows: Goods consigned and accepted by multimodal transportation operators are international goods.

International multimodal transportation refers to an international transport mode in which the multimodal transportation operator is responsible for transporting the goods from the receiving place in one country to the designated place in another country to deliver the goods in at least two different transport modes according to the multimodal transportation contract.

The necessary conditions for international multimodal transportation are as follows:

a. The goods consigned and accepted by multimodal transportation operators are international goods transportation.

b. Continuous transportation of at least two different modes of transportation.

c. The consignor and the multimodal transportation operator in charge of the whole transport shall conclude relevant multimodal transport contracts.

d. The multimodal carrier who has concluded the relevant contract with the consignor shall be responsible for the whole transportation of the goods.

e. Intermodal carriers are required to issue complete intermodal documents to meet different types of transportation needs.

f. Single freight rate is used for the whole transportation.

Transport Modes

The advantage of intermodal shipping is that it best combines multiple shipping methods while optimizing deadlines, reducing inventory costs and controlling the cost of goods.

First, the responsibility is unified, the procedure is simple. Ship your vessel, sign contracts, pay full freight, secure combined shipping documents, take on all responsibilities, and simplify procedures.

Under the international multimodal transportation mode, no matter how far the goods are transported, no matter how many transportation methods are used to complete the goods transportation, and no matter how many times the goods go through the transit, all matters transportation are handled by the multimodal carrier. The consignor only needs to handle the consignment once, sign a contract of carriage, pay the freight, handle the insurance, and obtain a thorough bill of lading.

The troubles of documents and procedures related to each mode of transportation are reduced to a minimum. The shipper only has to negotiate with the multimodal transportation operator.

Due to the unified responsibility, in the event of cargo loss or damage during transportation, the multimodal transportation operator shall be responsible for the entire transportation, and the sub-carriers of each transportation section are only liable for the loss of goods in their transportation section.

Second, reduce intermediate links, shorten freight time, reduce cargo damage, and improve cargo quality. After the goods are packed and sealed from the consignor's warehouse, they are directly transported to the consignee's warehouse for delivery. There is no need to unpack the boxes in the middle, reducing the intermediate links and better ensuring the safety of the goods and the quality of the goods. The transportation links and various transportation tools are closely matched and compact. When the goods arrive, the transit is prompt and timely, and the transit time is reduced. Therefore, the goods can be safely, quickly, accurately, and timely. Ground. Third, reduce transportation costs, save transportation costs, and facilitate trade development. After the goods are packed or loaded with the first-way transportation tools, the intermodal documents can be obtained for settlement, and the settlement time is early, which is conducive to accelerating the turnover of goods and reducing interest expenses. Multimodal transport uses a single intermodal document and a single freight rate, which greatly simplifies the production and settlement procedures, saves a lot of manpower and material resources, especially for the cargo side to pre-calculate the transportation cost, choose a reasonable transportation route and provide trade for the trade. Favorable conditions. Fourth, the level of transportation organization has been improved, door-to-door transportation has been realized, and reasonable transportation has reached reality. Multimodal transport integrates various modes of transportation, fosters strengths and avoids shortcomings, and constitutes direct and coherent transportation, which not only shortens transportation mileage, reduces transportation costs, but also accelerates freight turnover and improves cargo quality. The organization level of the multimodal transport carrier has improved the network work that can be carried out between multiple modes of transportation and realized the continuous transportation of multiple modes of transportation. The goods are transported from the carrier’s factory or warehouse to the consignee’s inland. Warehouses or factories have achieved door-to-door transportation, making reasonable time to reach reality. Multi-modal transport can be used to transport goods from the shipper's in-house warehouse to the consignee's in-house warehouse, laying a favorable foundation for door-to-door direct and consistent transportation.

Under the current situation of international trade competition, cargo transportation is fast, with less loss and low cost, and international multimodal transportation has adapted to these requirements. Therefore, multimodal transportation is increasingly used internationally. It is said that international multimodal transportation is the current development direction of international cargo transportation. my country has a vast territory, and there are prospects for expansion in international transportation. Development can be changeable. With the improvement of our domestic land transportation conditions, our international multimodal transportation will develop vigorously.

Fifth, other functions. From the government's point of view, the development of international multimodal transport has the following significance: to strengthen the government's supervision and management of the entire cargo transportation: to ensure that the domestic chain can obtain important and transportation income during the entire cargo transportation process; carry new Advanced transportation technology; reduce foreign exchange expenditures; transform the utilization of the country's infrastructure; through the macro-control and guidance function of national facilities, ensure that the use of transportation with minimal damage to the environment is achieved to protect the country's ecological environment.

The differences between multimodal transportation and general cargo transportation

In international multimodal transportation, one operator rarely undertakes all transportation. Often after accepting the consignor’s entrustment, the intermodal transport operator handles part of the transportation work by himself and entrusts other carriers for the remaining sections of the transportation work. But this is different from a single mode of transportation. The carriers who accept the transfer of multimodal transport operators are only responsible to the intermodal operators following the contractual relationship of the transportation and do not have any business relationship with the cargo owners. Therefore, the multimodal transport operator can be the actual carrier or the Non-Vessel Operating Carrier. The main differences between international multimodal transport and general international cargo transportation are as follows:

(1) The content of the shipping document is different from the production method. Most international multimodal transport is “door-to-door” transportation. Therefore, the actual carrier should issue the bill of lading or waybill at the same time after the cargo is loaded on the ship, truck, or machine. The multimodal transport operator issues the multimodal transport bill of lading. This is a multimodal transport. The fundamental difference between intermodal transportation and any single international freight transportation method. In this case, the shipper on the ocean bill of lading or waybill should be the multimodal transport operator, and the consignee and the notifying party should generally be the foreign branch of the multimodal transport operator or its agent. The multimodal transport bill of lading The consignee and consignor are the real and actual consignee and consignor, and the notifying party is the consignee or the consignee’s agent at the port of destination or final delivery location. In addition to the port of loading and unloading, the multimodal bill of lading must also specify the name of the place of receipt, the place of delivery, or the final destination, as well as the name of the first-haul transportation tool, the number of voyages, or the number of trains.

(2) The applicability and negotiability of the multimodal bill of lading are different from the general ocean bill of lading. Generally, the ocean bill of lading is only applicable to maritime transport. In this sense, the multimodal bill of lading is only applicable when the ocean is combined with other modes of transportation, but now it is also applicable to two or more different modes of transport besides ocean transportation. Coherent transnational transportation (the use of "international multimodal transport documents" abroad can avoid conceptual confusion). The multimodal transport bill of lading combines the negotiability of the ocean bill of lading with the non-negotiable nature of the waybill under other modes of transport. Therefore, the multimodal transport operator can issue both negotiable and non-negotiable multimodal means of transport according to the shipper’s requirements. Through bill of lading. In the former case, the consignee column should be made with instructions, and in the latter case, the consignee column should specify the name of the consignee and indicate non-transferability on the bill of lading.

(3) The terms on the letter of credit are different. According to the needs of multimodal transport, the terms on the letter of credit should be changed in the following three points: ①When negotiating with the bank, you cannot use the clean bill of lading issued by the shipping company. Instead, you should rely on the multimodal bill of lading issued by the multimodal transport operator. At the same time, it should also indicate how the title of the bill of lading is made to clarify whether it is transferable. ②Multimodal transportation generally adopts container transportation (except in special circumstances, such as the transportation of machinery and equipment under foreign engineering contracting, it is not necessary to use containers). Therefore, the specified container transportation clause should be added to the letter of credit. ③If the bill is not transferred by the bank, the shipper or consignor or the multimodal transportation operator will send the bill directly so that the consignee or agent can obtain the shipping documents as soon as possible and speed up the delivery at the destination port (place). The clause “the shipping documents shall be sent directly to the consignee or its agent by the consignor or the multimodal transportation operator” should be added to the letter of credit. If the multimodal transportation operator sends the bill, the consignor shall issue proof of "the shipping document has been received and sent out" by the multimodal transportation operator for the need of negotiation and settlement of foreign exchange.

(4) The procedures for customs inspection and release are different. In general, most of the delivery locations for international cargo transportation are at the loading port, and most destinations are at the unloading port. Therefore, the customs declaration and customs clearance procedures are all at the port where the goods enter and exit the country. The origin of international multimodal cargo is mostly inland cities. Therefore, the inland customs only handles the transit supervision procedures for the goods, and the customs at the exit place will check and release them. If the final destination of imported goods is an inland city, the customs at the port of entry generally do not perform inspections, but only go through customs supervision procedures. When the goods reach the final destination, the local customs will inspect and release them.

Requirements for international multimodal transport

The following conditions should be met for international multimodal transport: (1) The multimodal transport operator and the shipper must sign a multimodal transport agreement to clarify the rights, obligations, and exemptions of both parties. Multimodal transport contracts are the fundamental basis for determining the nature of multimodal transport and the main basis for distinguishing multimodal transport from general multimodal transport. (2) Must use MultimodalTransportDocuments, M. T. D. The document is not only a certificate of property right but also security. (3) It must be a single freight rate for the entire journey. This freight rate is charged at one time, including transportation costs (the sum of all transportation and miscellaneous fees), operating management fees, and reasonable profits. (4) A multimodal transport operator must be responsible for the entire transportation. He is the party to the multimodal transport contract signed with the shipper and is also the person who issues the multimodal transport document or the multimodal bill of lading. He is responsible for the entire transportation from the acceptance of the goods to the delivery of the goods. (5) It must be continuous transportation of two or more different modes of transportation. At the same time, short-distance bus transportation under a single mode of transportation does not belong to multimodal transportation. (6) It must be international cargo transportation across national borders. This is a restriction that distinguishes domestic transportation from international transportation.

Types of transportation

Railway Transport

Railway transportation is a mode of transportation that uses railway trains to transport passengers and goods. It plays an important role in the process of social material production. It is always defined by container-size transportation volume, high speed, low cost, and is generally not barred by bad climate. It is suitable for long-distance transportation of ponderous and heavy goods.

Air Freight

Generally, the goods are urgently needed. If the road transportation cannot meet the time limit required by the customer, the customer will choose air transportation. Air freight is fast and safe. Punctuality and ultra-high efficiency have played a huge role in winning sizable markets, significantly shortening delivery times, and accelerating capital turnover and circulation in the logistics supply chain. Major airlines have successively invested in a large number of flights to divide the cake of freight. However, the cost of air freight is higher than that of ocean freight.

Sea Freight

Ships used at sea are the means of transportation in different countries and regions by sea to transport goods by sea. It is the transportation mode of international transportation. More than two-thirds, 90% of the total import and export transportation volume is sea transportation: There are two main ways of sea transportation, namely liner transportation and chartering transportation.

Road Transport

The nature of road transportation of goods depends on, apart from the degree of development of the local infrastructure, the distance the goods are transported by road, the weight and volume of a single cargo, the type of cargo being transported. For short-distance and light small items, vans or pickup trucks are available. For large shipments even if less than a full truckload a truck is more appropriate.

Freight Costs

The means of transportation that completes its displacement process from the field of production to the field of consumption consumes the necessary labor of society and is created. Transportation price The actual value of the value form of the transportation product, showing that the multimodal transportation costs include freight, damage fees, transit fees and service fees (business agency fees), etc. The transportation cost is the transportation price level of various goods specifically formulated in accordance with the price policy. The level of freight rates must be value-based, the price comparison relationship of various modes of transportation must be considered, and it can promote reasonable scores and reasonable transportation among various means of transportation.

Freight Forwarder

A person entrusted by the customer to complete the cargo transportation or all aspects of the work related to this can be done directly or on their own to save money. According to the goods, there are also overseas agents. Freight forwarding refers to the general term for providing various transportation services for cargo transportation needs and capacity transporters in the field of circulation. Neptune involve the entire social service and are the main link between goods and transporters.

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