Who is this research for? This research is relevant for supply chain executives, logistics leaders, and transportation managers responsible for managing international freight decisions during periods of disruption.
Executive Summary
This research – based on a dissertation by recent Walton Ph.D. graduate Travis Kulpa – examines how U.S. importers adjust their use of international transportation modes when global containerized shipping becomes slower and more uncertain. Co-authored with Rodney Thomas and Matthew Waller at the Sam M. Walton College of Business (Department of Supply Chain Management) and Walton Ph.D. alum Jessica Darby, this study uses detailed U.S. import data from 2018 through mid-2023 to analyze how firms shift between containerized ocean shipping and air freight as shipping delays increase, focusing on products that historically used a mix of both modes.
The findings suggest that firms systematically increase their reliance on air freight as container shipping delays grow, despite air freight’s higher cost. This shift is especially pronounced for products that previously depended heavily on the ports of Los Angeles and Long Beach and for goods with higher value relative to weight. The evidence indicates that managers weigh rising transaction costs, coordination challenges, and the risk of lost sales against transportation costs when disruptions occur, using logistics flexibility as a practical response to preserve operational continuity.
Action Items for Industry
- Reevaluate mode decisions during disruptions: Longer and more uncertain ocean lead times may justify shifting freight to faster modes, even at higher cost.
- Identify port dependency risks: Products heavily reliant on congested ports may require earlier contingency planning for alternative transportation.
- Prioritize high-value shipments: Goods with higher value density are more likely to benefit from faster, more reliable transport during disruptions.
- Use logistics flexibility strategically: Maintain the capability to switch modes rather than relying on a single transportation option.
- Plan for heterogeneous impacts: Not all products or lanes respond the same way—mode decisions should reflect product characteristics and network exposure.
Quote from the Researcher
“Global supply chain managers should dynamically switch transportation modes when the opportunity costs outweigh the associated adjustment and transaction costs. Carriers and freight forwarders should selectively promote air freight during disruptions to shippers of relatively high-value containerized goods and containerized goods transported along significantly delayed routes.”
– Travis Kulpa
Co-Authors & Affiliations
Travis Kulpa — Grand Valley State University, Seidman College of Business
Jason W. Miller — Michigan State University, Eli Broad College of Business
Jessica L. Darby — Auburn University, Harbert College of Business
Link to the Original Research
Published in Transportation Journal, available here.
📩 Interested in learning more? If you’d like additional information about this research or to connect directly with the researchers, please email us at research@walton.uark.edu.
