Developing Responsive Rail Services through collaboration

In this paper, the problem of optimally serving one off‐loads arriving on spot markets through rail services is addressed. To facilitate rail’s responsiveness, collaboration among competing rail carriers positioned to handle the newly arising demand is considered. Through such collaboration, carriers can, by agreement, provide transport on existing trains for one‐off loads belonging to their competitors. Additionally, carriers can pool shipments with synergistic origins, destinations and desired delivery dates to form new train lines operated by one of the carriers in the collaboration. This problem of serving spot markets through collaboration among competing rail carriers operating within an alliance in co‐transporting one‐off loads arriving on the spot market is mathematically formulated and an efficient solution methodology employing concepts of collaborative decision‐making incorporated within a combinatorial auction (CA)‐based framework is proposed for its solution. The proposed technique aids in forming profitable trains that might otherwise have been underutilized and permits rail carriers to capture a greater share of the freight market.