integrated transport plan for ghana · 2018-08-07 · egis bceom international integrated transport...

Ministry of Finance and Economic Planning

Republic of Ghana

Integrated Transport Plan for Ghana

Volume 5: Transport Cost and Price Analysis Tool Final Version

Financed by the 9th European Development Fund

Service Contract N° 9 ACP GH019

June 2010

In association with

Egis Bceom International

Page 1 Integrated Transport Plan for Ghana


Executive Summary

This report presents the tool used for analysing the transport cost and price in Ghana.

The analysis tool use jointly between two main models and will be provided on a CD:

� RED VOC model – Computation of Vehicle Operating Costs calibrated with Ghana road

and vehicles fleet characteristics � A "Road cost and price analysis" model to compare costs and prices for freight forwarders

developed specifically for the present project.

The objective of the transport cost analysis tool was:

� to use the result as an input of the transport planning model for subsequent traffic

assignment forecast ; � use as inputs for the socio-economic evaluations of projects ; � to help to identify the obstacles to more efficient transport. It helps to answer questions

such as "Does the prices cover the costs for transport companies" ; � to be used as a pedagogical tool in order to understand the mechanism and the main

elements which shall be used to compute transport costs.




Contents

Chapter 1 Transport Cost and Prices Analysis Tool ............ .................6

1. Principles ...........................................................................................6

2. RED VOC model and parameters calibration.....................................7 2.1 Road Characteristics............................................................................ 7 2.2 Vehicle Fleet Characteristics and utilization ........................................ 8

3. VOC Model Results and Interpretation.............................................12 3.1 Observations/Interpretation on Paved Road...................................... 12 3.2 Observations/Interpretation on Concrete Road ................................. 13 3.3 Observations/Interpretation on Unsealed Road................................. 14 3.4 Sensitivity of the Vehicle Operating Costs ......................................... 15

4. Cost and Price Components ............................................................16 4.1 Variable costs..................................................................................... 16 4.2 Fixed costs ......................................................................................... 17

5. Operational characteristics ..............................................................19 5.1 Empty mileage and dispatching Costs............................................... 19 5.2 Load rate ............................................................................................ 21

6. Costs and Prices computation .........................................................25 6.1 Input values........................................................................................ 25 6.2 Results ............................................................................................... 26 6.3 Sensitivity analysis ............................................................................. 27

Annexe 1 : Driver and Vehicle Licensing Authority ( DVLA) Rates/Fees and Charges............................. ..........................29

Annexe 2 : Basic Input Data of the Road cost and pr ice analysis model.............................................. ........................................32




List of Tables

Table 1 - Main road characteristics according to surface type 7

Table 2 – Roughness according to road surface condition and surface type 8

Table 3 - Vehicle Fleet Characteristics 9

Table 4 - Utilization and Loading of vehicles 10

Table 5 - Economic Unit Costs 11

Table 6 – Summary of VOC/vehicle-km by category of Vehicle (Paved Road) 12

Table 7 - Summary of VOC/vehicle-km by category of Vehicle (Concrete Road) 13

Table 8 – Summary of VOC/vehicle-km by category of Vehicle (Unsealed Road) 14

Table 9 – Variable economic costs for a flat paved road in fair condition ($/veh.-km) 16

Table 10 – Variable financial costs for a flat paved road in fair condition ($/veh.-km) 17

Table 11 – Type of Inputs taken into account for the Cost and Price evaluation 25

Table 12 - Cost and price computation 26




List of Figures

Figure 1 – Variation of VOC Sale in relation with Roughness of the road 15

Figure 2 – Variation of truck speed in relation with Roughness of the road 15

Figure 3 – Sale price per km in relation with overhead costs and taxes values 19

Figure 4 - Dispatching Costs Generation Process 20

Figure 5 – Variation of sale price per km in relation with the percentage of empty mileage 21

Figure 6 - Du Pont De Nemours Prerating & Dating Indicator (P.A.D.I.) 23

Figure 7 – Variation of sale price per ton-km in relation with truck load rate 24

Figure 8 – Cost Sensitivity Analysis 28




Acronyms and Abbreviations

AADT Annual Average Daily Traffic

ITPG Integrated Transport Plan of Ghana

IRI International Roughness Index

OD Origin-Destination (usually refers to an OD pair or an OD matrix)

VOC Vehicle Operation Cost

VoT Value of Time




Chapter 1 Transport Cost and Prices Analysis Tool

1. Principles

The objective of the transport cost analysis tool was:

� to use the result as an input of the transport planning model for subsequent traffic

assignment forecast ; � use as inputs for the socio-economic evaluations of projects ; � to help to identify the obstacles to more efficient transport. It helps to answer questions

such as "Does the prices cover the costs for transport companies" ; � to be used as a pedagogical tool in order to understand the mechanism and the main

elements which shall be used to compute transport costs.

The analysis tool is developed on Excel in order for all the hypothesis and computation to be transparent to the user. It comprises the minimum macros possible for the same reason. All outputs may be automatically computed according to the parameters entered. Parameters of the transport cost analysis tool are calibrated to take into account the Ghanaian context. All available unit costs data were collected and introduced into the model. However, some costs may vary from one company to another and could be adjusted accordingly. Being a dynamical model, it is then possible to assess the sensitivity of transport costs to the various unit costs entered.

The analysis tool use jointly between two main models:

� RED VOC model – Computation of Vehicle Operating Costs calibrated with Ghana road

and vehicles fleet characteristics � A "Road cost and price analysis" model to compare costs and prices for freight forwarders

developed specifically for the present project.




2. RED VOC model and parameters calibration

The objective of using Roads Economic Decision Model, HDM-4 Vehicle Operating Costs Module (RED VOC) was to estimate Annual Average VOC per vehicle-km travelled for the various categories of vehicles used in Ghana under the different road surface conditions for each type of road facility.

2.1 Road Characteristics

Road characteristics comprise the existing road and environmental factors. These include:

� Road surface condition (good, fair, poor) � Surface type (paved, concrete, unsealed) � Terrain type (Flat, rolling, montainous) � Length of road � Pavement structure and strength � Altitude and rainfall

Ministry of Transport calibrated values of parameters was used. The following road characteristics according to surface type were used in the model as illustrated in the following table.

Table 1 - Main road characteristics according to su rface type

Carriageway

Width (m) Speed Limit (km/hour)

Paved 7.0 100

Concrete 6.0 80

Unsealed 5.0 70




Roughness rate according to the types of road surface and conditions modelled is presented in the form of Riding Quality Matrix shown in the following table.

Table 2 – Roughness according to road surface condi tion and surface type

Road Surface Condition - Roughness (IRI)

Type of Surface Good Fair Poor

Bituminous 3 5 7

Concrete 2.5 4 6

Unsealed 5 7.5 9

Source: Ministry of Transportation (HDM-4 Calibration for Ghana), March 2007

2.2 Vehicle Fleet Characteristics and utilization

Taking into account distribution of vehicle fleet observed in Ghana, the following categories of vehicles are considered:

1. Cars

2. Taxis

3. Light Buses

4. Medium Buses

5. Heavy Buses

6. Light Trucks

7. Medium Trucks

8. Heavy Trucks

9. Articulated Trucks

Vehicle fleet characteristics, and their utilization and unit costs are based mostly on values observed by the Ministry of Transport and Ghana Highway Authority. These values were calibrated for the model HDM 4 which is used to evaluate main road maintenance and development projects in Ghana. Vehicle Fleet Characteristics are illustrated in Table 3. Utilization and loading of vehicle are illustrated in Table 4. Unit economic costs by type of vehicle, illustrated in Table 5, are extracted from the report on Vehicle Operating Cost Data Collection for HDM-4 issued by Ghana Highway Authority in February 2009.




Table 3 - Vehicle Fleet Characteristics

Car Taxi Bus Light Bus Medium

Bus Heavy

Truck Light

Truck Medium

Truck Heavy

Truck Articulated

Number of Wheels (#) 4 4 4 6 10 4 6 10 18

Number of Axles (#) 2 2 2 2 3 2 2 3 5

Tire Type (0-Radial-ply, 1 - Bias-ply) 0 0 1 1 1 1 1 1 1

Projected Frontal Area (m2) 1.9 1.9 4 5 6.5 4 5 8.5 9

Used Driving Power (kW) 33 33 50 65 120 50 87 227 227

Used Braking Power (kW) 20 20 45 70 120 45 70 255 255

Rated Engine power (kW) 70 70 75 100 130 75 100 280 300

Source: Ministry of Transportation (HDM-4 Calibration for Ghana), March 2007.




Table 4 - Utilization and Loading of vehicles


Bus Heavy

Truck Light

Truck Medium

Truck Heavy

Truck Articulated

Kilometres Driven per Year (km) 20,000 25,000 25,000 41,000 52,000 30,000 60,000 60,000 100,000

Hours Driven per Year (hr) 500 1,300 1,300 2,000 2,000 1,715 1,750 1,750 1,750

Service Life (years) 12 13 12 12 12 12 12 14 14

Gross Vehicle Weight (tons) 1.10 1.90 3.00 6.00 9.70 5.10 15.00 21.00 40.00

Payload 3.00 8.00 15.00 28.00

Passenger Car Equivalent (#) 1 1 1.4 1.5 1.6 1.3 1.4 1.6 1.8

Source: Ministry of Transportation (HDM-4 Calibration for Ghana), March 2007.




Table 5 - Economic Unit Costs


Bus Heavy

Truck Light

Truck Medium

Truck Heavy

Truck Articulated

New Vehicle Cost ($/vehicle) 21,208 18,888 32,827 76,621 170,894 20,405 73,842 77,465 150,659

Fuel Cost ($/Litre for MT, $/MJ for NMT) 0.43 0.61 0.61 0.61 0.61 0.61 0.61 0.61 0.61

Lubricant Cost ($/Litre) 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50 1.50

New Tire Cost ($/tire) 63.04 76.31 72.99 212.34 165.89 139.35 298.60 345.05 398.14

Maintenance Labor Cost ($/hour) 1.60 1.60 1.60 1.60 1.60 1.60 1.60 1.60 1.60

Crew Cost ($/hour) 0.00 0.38 0.45 0.68 0.68 0.75 0.83 0.95 0.95

Interest Rate (%) 15.00 15.00 15.00 15.00 15.00 15.00 15.00 15.00 15.00

Source : Report on Vehicle Operating Cost Data Collection for HDM-4 – Ghana Highway Authority, February 2009




3. VOC Model Results and Interpretation

The Vehicle Operating Costs (VOC) varies in function of four main factors:

� The type of vehicle (car, bus, truck, etc…) ; � The type of terrain (Flat, Rolling, Mountainous) ; � The type of road (Paved, Concrete, Unsealed) ; � The surface condition (Good, Fair, Poor) defined according to the type of road and the IRI

(see table above).

In Ghana, most of the roads may be considered as flat. Therefore, VOC model results are presented for each type of vehicle, type of road and surface condition considering that the terrain is flat.

3.1 Observations/Interpretation on Paved Road

The following table describes the variation of the VOC per category of vehicle per surface condition (on a flat terrain) on a paved road in Ghana.

Table 6 – Summary of VOC/vehicle-km by category of Vehicle (Paved Road)

Surface Condition

Vehicle Type Good Fair Poor

Car 0.18 0.19 0.20

Taxi 0.18 0.19 0.20

Bus Light 0.26 0.28 0.30

Bus Medium 0.37 0.41 0.45

Bus Heavy 0.67 0.75 0.84

Truck Light 0.21 0.22 0.24

Truck Medium 0.49 0.55 0.60

Truck Heavy 0.65 0.71 0.75

Truck Articulated 1.16 1.29 1.39

Source: HDM-VOC Model computation




The following can be observed from the above Table:

� Operating costs are approximately four times more important for a heavy bus or a heavy

truck and up to seven times more important for an articulated truck than for a car. Light bus VOC is approximately 50% higher than car VOC.

� If the road condition deteriorates (between a road in good condition and a road in poor conditions), VOC of cars increase by 11%. VOC of heavy vehicles and in particular buses is more sensitive to the road condition as a deterioration of the road lead to an increase of 25% of the VOC for a heavy bus and 20% for an articulated truck.

3.2 Observations/Interpretation on Concrete Road

The following table describes the variation of the VOC per category of vehicle per surface condition (on a flat terrain) on a concrete road in Ghana.

Table 7 - Summary of VOC/vehicle-km by category of Vehicle (Concrete Road)

Surface Condition


Car 0.18 0.18 0.20

Taxi 0.18 0.18 0.20

Bus Light 0.26 0.27 0.29

Bus Medium 0.38 0.39 0.44

Bus Heavy 0.68 0.72 0.82

Truck Light 0.21 0.22 0.24


Truck Heavy 0.67 0.70 0.77




� Operating costs are approximately four times more important for a heavy bus or a heavy

truck and more than seven times more important for an articulated truck than for a car. Light bus VOC is approximately 45% higher than car VOC.




� If the road condition deteriorates (between a road in good condition and a road in poor conditions), VOC of cars increases by 11%. VOC of heavy vehicles and in particular buses is more sensitive to the road condition as a deterioration of the road lead to an increase of 21% of the VOC for a heavy bus and 18% for an articulated truck.

3.3 Observations/Interpretation on Unsealed Road

The following table describes the variation of the VOC per category of vehicle per surface condition (on a flat terrain) on an unsealed road in Ghana.

Table 8 – Summary of VOC/vehicle-km by category of Vehicle (Unsealed Road)

Surface Condition


Car 0.19 0.21 0.22

Taxi 0.19 0.21 0.22

Bus Light 0.28 0.32 0.34

Bus Medium 0.41 0.49 0.52

Bus Heavy 0.76 0.93 0.98

Truck Light 0.22 0.26 0.27


Truck Heavy 0.72 0.83 0.86




� Operating costs are more than four times more important for a heavy bus, nearly four time

more important for a heavy truck and more than seven times more important for an articulated truck than for a car. Light bus VOC is approximately 55% higher than car VOC.

� If the road condition deteriorates (between a road in good condition and a road in poor conditions), VOC of cars increases by 16%. VOC of heavy vehicles and in particular buses is more sensitive to the road condition as a deterioration of the road lead to an increase of 29% of the VOC for a heavy bus and 22% for an articulated truck.




3.4 Sensitivity of the Vehicle Operating Costs

The following figure illustrates how the vehicle operating cost varies according to the roughness of the roads for a medium truck on a paved flat road.

Flat / 1-Paved / Truck Medium

y = -2E-05x3 + 0.0009x2 + 0.0153x + 0.4486

R2 = 0.9998

0.00

0.20

0.40

0.60

0.80

1.00

1.20

0 5 10 15 20 25 30

Roughness (IRI)

Ve

hic

le O

pe

ratin

g C

ost

s ($

/ve

h-

km)

HDM-4 Values Polynomial

Figure 1 – Variation of VOC Sale in relation with R oughness of the road

Subsequent figure shows the relation between the roughness of the road and the vehicle speed.

Flat / 1-Paved / Truck Medium

y = 0.0078x3 - 0.2348x2 - 1.625x + 93.028

R2 = 0.9919

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

0 5 10 15 20 25 30

Roughness (IRI)

Veh

icle

Spe

ed (k

m/h

our)

HDM-4 Values Polynomial

Figure 2 – Variation of truck speed in relation wit h Roughness of the road




4. Cost and Price Components

The cost of a managing a truck breaks down into:

� variable costs (related to the use of vehicles) and � fixed costs (which do not depend directly on the number of total kilometres travelled by

trucks of the company)

4.1 Variable costs

4.1.1. Variable economic costs

Most of the variable costs taken into account into the Road cost and price analysis model are an outcome of the HDM-VOC model. They are computed in dollar per vehicle-kilometre. Costs depend from:

� the type of vehicle used � the type of road � the surface condition of the road

An example of variables costs which may be used in the model for a flat paved road in fair condition is presented in the following table.

Table 9 – Variable economic costs for a flat paved road in fair condition ($/veh.-km)

Truck Light

Truck Medium

Truck Heavy

Truck Articulated

Fuel economic costs 0.09 0.15 0.27 0.38

Lubricants Costs 0.00 0.00 0.01 0.01

Tire Costs 0.01 0.02 0.04 0.07

Maintenance Parts Costs 0.04 0.22 0.24 0.62

Maintenance Labor Costs 0.02 0.02 0.02 0.03

Crew Costs 0.01 0.01 0.01 0.01

Depreciation 0.05 0.09 0.08 0.09

Interest 0.01 0.04 0.04 0.08

Informal costs 0.04 0.04 0.04 0.03

Source: HDM-VOC Model computation and other unit financial costs

It should be noticed that depreciation costs depend mainly from the costs of a new vehicle and the service life of the vehicle. It could be considered as a fix cost to be paid every year.




However in HDM-VOC model, it is considered that the condition of use of the vehicle may influence its premature wear. Depreciation costs therefore also vary according to the type and condition of the road on which it is used.

Informal costs often occur in the region as observed by the "Observatoire des pratiques anormales (OPA) sur les axes routiers inter-états" during the period from May 27th 2007 to October 26th 2007. As an average, a truck is asked the equivalent of 2.75 dollar of informal costs for 100 km covered which is however far less than in neighbouring countries.

4.1.2. Variable financial costs

In order to evaluate financial costs, various taxes have to be applied to the operating costs computed with HDM-VOC.

Interest Rate is set to 15% as recommended in the frame of the evaluation with HDM4.

Value Added Tax (VAT) is set to 12.5% and National Health Insurance Levy is set to 2.5% according to governmental sources (http://www.vats.gov.gh/). These two rates are used to adjust economic costs supported by truck companies, mainly lubricants, tires and maintenance parts.

Fuel financial costs is based on the value observed at the petroleum station early 2010, namely 0.84 $ / Litre.

Financial costs in dollar per vehicle-kilometre for a flat paved road in fair condition are illustrated in the following table.

Table 10 – Variable financial costs for a flat pave d road in fair condition ($/veh.-km)

Truck Light

Truck Medium

Truck Heavy

Truck Articulated

Fuel Financial cost (with taxes) 0.12 0.21 0.37 0.52

Lubricants Financial Costs 0.00 0.00 0.01 0.01

Tire Financial Costs 0.01 0.02 0.04 0.08

Maintenance Parts Financial Costs 0.04 0.25 0.28 0.71

Source: HDM-VOC Model computation and other unit financial costs

4.2 Fixed costs

As mentioned earlier, vehicle cost through depreciation of the vehicle is already included in the VOC calculation.

4.2.1. Insurance

Insurance of the vehicle is estimated to 3% per year of the replacement value of the vehicle. To take into account the evolution of the vehicle value during its life, the half of the new vehicle cost is taken as a base of calculation. For a light truck, based on a 20,405$ new




vehicle cost, the insurance will be 307 $ each year. For a heavy truck, based on a 77,465 $ new vehicle cost, the insurance will be 1,162 $ each year.

Even if insurance is not subscribed by the truck company, the risk should be integrated into costs endured by the company. If a company would not pay at all or regularly an insurance premium, any damage would have anyway to be financed directly by it.

Cargo is also at risk. Insurance of cargo of about 2.5% of the freight value is usually observed in developed countries. However, we will consider that cost does not include cargo insurance, since, as often in developing countries, the freight is supported by the client.

4.2.2. Taxes on vehicles

Tax on vehicles is still very low in Ghana, even if it increased recently. Since February 8, 2010, the amount to be paid by heavy vehicles fixed by the Driver and Vehicle Licensing Authority (DVLA) is equivalent to 20 $ per years. See all details on other duties in the annex.

4.2.3. Overhead costs

Overhead costs consist in the ongoing administrative expenses of a business which cannot be attributed to the specific transport business activity, but are still necessary for the transport business to function. Overhead costs mainly include the following costs:

� administrative staff salaries and social subscription � tax on profit � office rent and related insurance � utility charges

Overhead costs may vary deeply from one company to another it can reach up to the half of costs and a quarter of turnover depending of the scope taken into account.

To compute how overheads costs incurred to the main activity of the transport companies, they are divided by the number of vehicle of the fleet.

Based on several interviews, as the number of vehicles per company is low overhead costs was estimated for one average truck company to 6000 $ per year per vehicle. This figure of course may greatly vary from one company to another depending of the type of management and of the number of vehicles in the fleet.

In the following figure is tested the sensitivity of sale price to the variation of the value of overhead costs.




Overhead costs and taxes (Lumpsum) ($/veh/year)

Sale price per km (Partial Truck Load) ($/km)

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

0 2,000 4,000 6,000 8,000 10,000 12,000

Figure 3 – Sale price per km in relation with overh ead costs and taxes values

We observe that all other things being equal, sale price per kilometre double when overhead costs are multiplied by ten.

4.2.4. Profit margin

Profit margin of truck companies has been estimated to 80% in West Africa (see –World Bank - Transport Prices and Costs in Africa, 2008).

Profit margin could have been computed as a dependant variable resulting from the difference between total costs and the price market. But, we have chosen in this model a carriers viewpoint. This allows the carrier to calculate prices of services rendered by entering in the model the costs (fixed and variable are known), and the expected profit margin.

5. Operational characteristics

Beyond this breakdown of costs, the cost of a truck is heavily dependent primarily on the rate of empty mileage performed and the load rate inside the truck. Relevant characteristics are grouped in the cost computation model under the denomination "Vehicle Characteristics" and "Vehicle Utilization and Loading". Two main factors were considered to compute total transportation costs:

� Empty mileage and dispatching costs � Load rate of the trucks

5.1 Empty mileage and dispatching Costs

In order to compute the real costs supported by the transport firms, dispatching costs have to be considered.

Dispatching costs occurs when a truck has to run empty in order to reach the place where the freight will be loaded. This situation often happens when a truck seeks return cargo. As




described in the following figure, a truck carried freight from a place A to B. In order not to return empty, the truck will reach a place C to .load commodities which will be carried back to the place A. The vehicle operating costs spent during the empty run have to be reintegrated in the global costs.

Figure 4 - Dispatching Costs Generation Process

In principle, in order for the carrier to remain competitive, dispatching costs should be shared out between all clients. Therefore these costs have to be computed and reintegrated into the prices through variable costs.

Dispatching costs are computed in dollar/vehicle-kilometre as follow:

DC = TVC * 1)1(

1 −− EM

, where:

� DC: dispatching costs � TVC: Total Variable Costs per km � EM: percentage of Empty Mileage during the year

Proportion of loaded mileage is estimated to 75% in this region of the world according to observations (see –World Bank - Transport Prices and Costs in Africa, 2008). Loaded mileage is computed as the ratio of the number of kilometres with payload over the total number of

(A) First loading place

(B) Unloading place

(C) Second loading place

First trip

loaded mileage

Empty mileage entailing

dispatching costs

Return trip

Loaded mileage




kilometres of a truck. The proportion of empty mileage in regards to the total mileage is therefore estimated to 25%.

The objective for carriers is of course to reduce as much as possible these costs. The following sensitivity analysis shows the impact in the variation of empty mileage to the sale price per ton.

Percentage empty mileage (% of km)

Sale price per km (Partial Truck Load) ($/km)

0.00

0.50

1.00

1.50

2.00

2.50

0% 10% 20% 30% 40% 50% 60% 70% 80%

Figure 5 – Variation of sale price per km in relati on with the percentage of empty mileage

5.2 Load rate

The performance of a truck in terms of load rate is a determinant of carrier profitability, as revenues (and profits) are generally correlated to the load rate of the vehicles. If the truck is not full loaded and if there is no possibility to complement the loading, costs incurred to the trucker will be nearly the same as for a full truck. However the carrier cannot bill the freight forwarder the entire costs incurred. There should be however an incentive in the tariff structure to favor bigger loads.

To take into account loading rate of vehicle in tariffs, it is proposed to used the "Preparating and Dating Indicator" (PADI) developed by Dupont de Nemours in the United States of America. This tariff system prompts freight forwarder to better load trucks by proposing them a better sale price when the truck is better loaded.

The calculation of the tariff is rather simple:




SP = FTL_SP * PADI, where

� SP: final Sale Price � FTL_SP: Full Truck Load Sale Price, price that would be paid is the truck was full.

with PADI rate in percentage computed as follow:

PADI = TLR , where:

� TLR: Truck Load Rate in percentage of the shipment weight or volume

Evolution of the PADI rate according to the load rate is illustrated in Figure 6.

For example, if the truck is loaded at 20%, the freight forwarder will pay 45% of a full load rate truck. If the truck is loaded at price 80%, the freight forwarder will pay 89% of a full load rate truck.

Payload per type of vehicle used in the model is listed in Table 4 in the previous chapter.




0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

90.00%

100.00%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%

Shipment Weight Or Volume

Cos

t Rel

ativ

e to

Ful

l Tru

ck L

oad

Figure 6 - Du Pont De Nemours Prerating & Dating In dicator (P.A.D.I.)




As for interviews and observation, average load rate have been estimated to 80%.

The following sensitivity analysis shows the impact in the variation of load rate of the truck to the sale price per ton-km.

Load rate (ton (%))

Sale price per ton-km (Partial Truck Load) ($/ton-km)

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

0% 20% 40% 60% 80% 100% 120%

Figure 7 – Variation of sale price per ton-km in re lation with truck load rate

We observe that the improvement of load rate contributes to the diminution of sale price per ton kilometre in large proportion when the load rate is initially low and in a lesser progression when the cargo reaches the payload of the truck.

On the other hand if a high load rate is beneficial to the carriers, it should not be excessive. In Ghanaian road, one of the risks is overloaded trucks which lead to higher costs for the community:

� Abnormal wear of the road. Besides the direct cost (repair of the road), we must also take

into account a significant indirect costs related to overweight trucks, namely congestion and accidents during the construction and maintenance.

� A single truck heavily overloaded (ie axle load limit is exceeded by 20%) causes wear equivalent to that of 245,000 cars.

� In addition to damaging the road surface, overweight trucks also threatens the safety of other road users. Overload significantly increases stopping distances and therefore the risk of accidents and the impact (severity) of these. It even happens that overweight causes a failure of the braking system.




6. Costs and Prices computation

6.1 Input values

Many of the basic input data change according to the type of vehicle concerned. There are displayed in the Excel Sheet "Input" where the following headings are distinguished:

� Financial Parameters � Vehicle Characteristics � Vehicle Utilization and Loading � Economic Unit Costs � Vehicle Operating Costs (VOC) � Fixed costs

Many of the data are outputs of the HDM-VOC model. Some, coming from other sources have been added on this sheet.

All basic inputs data are presented in the Annexe 2.

Relevant data are then linked to the "CostPrice" Excel sheet. Basic data are displayed in the column "Value per Vehicle" The other columns are automatically updated to implement "Sensitivity Analysis".

The elements used in the model are presented in the following table. Values which are presented may change according to hypothesis and observation of the users.

Table 11 – Type of Inputs taken into account for th e Cost and Price evaluation

Inputs Unit Value per Vehicle

Operation characteristics Loaded mileage km/year 22,500.00 Percentage empty mileage % of km 25% Total working day per year day/year 214 Payload ton 3.00 Load rate ton (%) 80% Mileage per order (excl. empty mileage) km/order 500 Variable costs Fuel financial costs $/veh-km 0.13 Lubricants financial costs $/veh-km 0.00 Tire financial costs $/veh-km 0.01 Maintenance parts financial costs $/veh-km 0.06 Maintenance labor costs $/veh-km 0.02 Crew costs $/veh-km 0.01 Depreciation $/veh-km 0.07 Interest $/veh-km 0.01 Informal costs (bribes) $/veh-km 0.04




Inputs Unit Value per Vehicle

Fixed costs Taxes on vehicles $/veh/year 20.00 Insurance of the vehicle $/veh/year 306.08 Overhead costs and taxes (Lumpsum) $/veh/year 6,000.00 Profit Profit Margin % of $ 80%

6.2 Results

Cost and price computation is implemented in the second part of the "CostPrice" Excel sheets. Results can also be called dependant variable as their value depend from the basic inputs described above.

Values displayed in the following table are also indicative as they may change according to basic inputs data chosen.

Values are computed per vehicle-kilometres when values concern variable costs and per day for fixed costs.

Table 12 - Cost and price computation

RESULTS Unit Value per

vehicle Empty mileage km/year 5,625 Total mileage km/year 30,000 Total variable costs $/veh/year 10,474.65 Total fixed cost $/veh/year 6,326.08 Total costs $/veh/year 16,800.73 Indicators Total variable costs per km $/veh-km 0.35 Dispatching costs $/veh-km 0.12 Total Variable costs per km sold $/veh-km 0.47 Fixed costs per loaded mileage $/veh-km 0.28 Total costs per loaded mileage $/veh-km 0.75 Fixed costs per day $/veh/day 29.51 Total costs per day $/veh/day 78.37 Transport costs Billable weight ton 2.40 Fixed costs per order $/order 140.58 Variable costs per order $/order 232.77 Total costs per order $/order 373.35 Transport price according to PADI Sale price (Full Truck Load) $/order 672.03 Sale price per ton (Full Truck Load) $/ton 280.01 Sale price per km (Full Truck Load) $/km 1.34 Sale price per ton-km (Full Truck Load) $/ton-km 0.56 Cost relative to Full Truck Load ton (%) 89% Sale price (Partial Truck Load) $/order 601.08 Sale price per ton (Partial Truck Load) $/ton 250.45 Sale price per km (Partial Truck Load) $/km 1.20 Sale price per ton-km (Partial Truck Load) $/ton-km 0.50




Price is computed by adding fixed costs per order to variable costs per order. Variable cost is computed multiplying "Total Variable costs per km sold" by the mileages required to implement the order. Fixed cost is computed taken into account the ratio between the mileages required to implement the present order and the total mileage implemented by the truck by year.

Final price is then computed using the PADI formula.

6.3 Sensitivity analysis

The Excel sheet named "Analysis" permits to implement sensitivity analysis dynamically. This tool allows testing what are the main factors which influence costs and prices?

The following figure illustrated how the analysis works:

� Road characteristics and truck type has to be chosen. � The independent variable taken from a list has to be selected it will be the value put in x-

axis on the graph. The independent variable is chosen among the basic input data. This may be for example, the percentage of empty mileage, the load rate, the fuel financial costs

� Range value for the independent variable has to entered (from … to …) � The dependant variable has to be selected also from a list. This variable will constitute y-

axis of the graph.

As a result, it is possible to test different factors and see what are their impact on the transport costs and prices. Some of the figure which illustrated the present report has been made using this tool.

Sensitivity analysis permits to observe clearly that some factors such as:

� condition of the road (IRI) ; � diminution of empty backhaul ; � improvement of vehicle loading ;

have a great influence in the setting up of transport costs and prices and may permit the improvement of revenue for transport carriers.




Figure 8 – Cost Sensitivity Analysis




Annexe 1 : Driver and Vehicle Licensing Authority (DVLA) Rates/Fees and Charges

A. Licensing Duties

Accident Report Fee 1.00

Amendment Of Register 3.00

Application to Emboss Blank No Plate 1.00

Application to Manufacture Blank No Plate 1.00

Certficate to Manufacture Blank No Plate 20.00

Certificate to Emboss Blank No Plate 10.00

Change Of Ownership, Motorcycles, Scooters 2.00

Change Of Ownership, Vehicle 5.00

Change Of Use 10.00

Conversion to Right Hand Drive 100.00

Driver License Application Form F 0.20

Driver License Change of Class Form X 0.20

Driving Test Fee 2.00

Eye Test Application Form F1 0.20

Highway Code Booklet 1.00

International Driver Permit Application Form 3A 0.20

International Driving Permit 20.00

International Driving Permit Test Fee 5.00

International Transit Application Form 3 0.20

International Transit Fees Articulated Trucks 30.00

International Transit Fees Cars/Pick-Ups 10.00

International Transit Fees Heavy Buses/Trucks (Under 3 Axles) 20.00

International Transit Fees Light Buses/Trucks (Up to 33 Seater) 15.00

International Vehicle Certificate 5.00

Learner Drivers Licence 1.00




Particulars of Vehicles – Extract 1.00

Particulars of Vehicles - Photocopy of File Entries 5.00

Physical Conversion 100.00

Renewal of Learner Drivers License Fee For 3 Months 1.00

Renewal of New Drivers Licence (2yrs) 4.00

Upgrading of Driver's Licence 6.00

Trade Plate Licence Fee 24.00

Trade Plate Licence Form D 10.00

Trade Plate Log Book - Form E 1.50

Vehicle Registration Form A 0.20

Vehicle Registration Form C 0.20

Vehicle Road Worthiness Certificate (VRC) 0.50

B. New license fee

Conversion of Foreign Drivers License (Provisional Driving Licence)-GOG 6.00

Drivers Licence Bklet (CoverNote-Provisional Driving Licence)-GOG 6.00

Drivers Licence Booklet (Cover Note-Provisional Driving Licence)- GOG 6.00

C. Road Worthiness / Road User Fee

Agricultural Equipment (Mechanically Propelled) 3.00

Articulated Trucks 24 Tons But Less than 32 tons 20.00

Articulated Trucks Up To 32 Tons And Above 20.00

Commercial Buses And Coaches 3.50

Commercial Motor Vehicle Above 2000cc 3.00

Commercial Motor Vehicle Up To 2000cc 2.00

Fee For Replacement Of Certificate Or Sticker 0.80

Motor Cycle 0.80

Private Buses And Coaches 4.00

Private Motor Vehicle Up To 2000cc 2.00




Private, Motor Vehicle Above 2000cc 3.00

Rigid Cargo Trucks Above 16 tons & Up To 22 Tons 3.50

Rigid Cargo Trucks Above 22 tons 4.80

Rigid Cargo Trucks Above 24 tons 6.00

Rigid Cargo Trucks Up To 16 Tons 3.00

Vehicle Layoff Form A4 0.20

Vehicle Layoff Form A4 - (VRC) 0.50

Vehicle Road Worthiness Certificate (VRC) Penalty 4.00

D. Vehicle Registration

Agricultural Equipment (Mechanically Propelled) 20.00

Articulated Equipment (Mechanically Propelled) 10.00

Articulated Trucks 24-32 Tons 120.00

Articulated Trucks Above 32 Tons 120.00

Articulated Trucks Up To 24 Tons 120.00

Articulated-Tipper Trucks 120.00

Buses And Coaches 40.00

Combine Harvesters 20.00

Construction Equipment 20.00

Delinquency Fee (Re-registration) 100.00

Mining Equipment (Mechanically Propelled) 30.00

Motor Cycles 5.00

Motor Vehicles Above 2000cc 30.00

Motor Vehicles Up To 2000cc 20.00

Particular Identification Mark 1.000.00

Rigid Cargo Trucks Above 22 Tons 70.00

Rigid Cargo Trucks From 16-22 Tons 60.00

Rigid Cargo Trucks Up To 16 Tons 50.00

Special Number 100.00




Annexe 2 : Basic Input Data of the Road cost and price analysis model

integrated transport plan for ghana · 2018-08-07 · egis bceom international integrated transport...

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