Global Supply Chain Management

1. What is the role of government in air transportation from an economic and safety standpoints?

The government provides regulation in the air transport ensuring that products from a country are able to reach global and local markets. Through aviation regulations, the government has a responsibility of ensuring that it supports airport infrastructures (Coyle et.al. 2016).  The supports help in construction of runways and visitors waiting bays as they their flights. Through the support, it is possible for producers to connect to different markets in a significant manner. Further, perishable materials are able to reach different destinations in time influencing positive outcome of the economy. In addition, through air transport the government creates avenues for imports into the country boosting the availability of different products to people. Additionally, government has a role of ensuring security in the air transport from threats such as terror. The government requires providing adequate surveillance on its air space to ensure that aircrafts fly in its only permitted territory (Coyle et.al. 2016).  Additionally, government conducts searches on passengers and goods to ensure safety of travellers. Further, the process ensures blocking of illegal goods, which could pose security challenge to its people. 

2. Discuss at least two current issues facing the air industry and how each impacts the industry, its customers and employees.

One of a significant issue facing the air industry is global terrorisms that targets innocent people from different terror group. The rising number of terror groups such as Al Qaida and ISIS pose global challenge to air industry (Miranda, 2015). The September 11 terror attack in America involved hijacking of airplanes and using them to cause the damage (Miranda, 2015). The industry is also facing rising cost of operation due to need to install different security measures in airports and in flights. Customers on the other hand feel uneasy and unsure about their safety especially if they board airplanes in terror prone countries. For employees there is pressure from their employer to become more vigilant through thorough checks on all customers. Another issues is fluctuating oil prices that affect cost of operation in the air industry. The industry suffers from rising cost of fuel and this lowers its profitability (Miranda, 2015). The effect to customers is increase in transport cost and this is lowering the number of people willing to take flights. The employees are likely to face retrenchment as the industry embrace ways of curbing rising operation cost. 

3. Provided that pipelines account for more than 20 percent of the intercity ton-miles but less than 5 percent of the revenue paid by shippers to transportation companies, explain what factors account for this contrast and whether this situation is likely to change. Defend your answer by providing additional examples and references.

The use of pipelines as mode of transportation is relatively lower due to their specificity in the mode of goods they are able to carry. Indeed, pipelines design only allows transportation of fluid products (Covert, 2017). Actually, the mode helps in transport of gases and oil products under pressure. However, the transportation is ineffective to use on bulky products that are solid in nature. Liquefied products account for relatively low amount of products transported between different parts thus the low pay from the system. Additionally, pipelines are underground and significant number of people does not know about them (Covert, 2017). The impact is individuals preferring to use the other modes of transport, which they are conversant. However, in future the revenue from pipeline will rise as people become aware of its existent and it relative low cost in comparison to other transport modes. The mode is also independent of weather and thus its use is continuous thus adding its convenience on customers. 

4. Water carriers played a dominant role in the transportation system of the United States in the 18th and 19th centuries. Explain why their relative position has declined during the 20th century whether or not they still an important component of the total transportation system. Substantiate your answer with examples and references

The decline in water transportation in the United States results from the rising number of alternative transport modes such as rails and roads (Coyle et.al. 2016). The construction of rails has made to possible for interconnectivity of the states in convenient manner in comparison to water transport. Indeed, enhancing water transport requires artificial construction of canals and it is relatively costly in comparison to rails or roads (Stratfor Contributor, 2013). Further, the seasonality of water sources causes the mode of transport to be relatively unreliable. Indeed, some water channels suffer from lowering water volume during certain seasons of the year. The impact is inconvenience of transporters who use relatively large water vessels for transport. However, despite the decline, the water transports is a significant component of transport industry in United States. Indeed, water transport through Mississippi river account for over 60% of exports from oil seeds and grains from America every year (National Grain and Food Reservation, 2014).

References

Covert, T. R. (2017). Crude By Rail, Option Value, And Pipeline Investment. Retrieved January 22, 2019, from: http://home.uchicago.edu/~tcovert/webfiles/cbr.pdf

Coyle, J. J., Novak, R. A., & Gibson, B. (2016).Transportation: A global supply chain perspective (8^th ed.) Boston, MA: Cengage Learning

Miranda, U. (2015). The Relationship between Terrorism, Oil Prices, and Airline Profitability. Retrieved January 22, 2019, from: https://scholarworks.waldenu.edu/cgi/viewcontent.cgi?article=1446&context=dissertations

National Grain and Food Reservation. (2014). Importance of Waterway Transportation to U.S. Agriculture. Retrieved January 22, 2019, from: https://www.ngfa.org/wp-content/uploads/2013-NGFA-Waterways-Issue-Paper-_April.pdf

Stratfor Contributor. (2013). United States: The Problem of Aging Infrastructure on Inland Waterways. Forbes. Retrieved January 22, 2019, from: https://www.forbes.com/sites/stratfor/2013/11/07/united-states-the-problem-of-aging-infrastructure-on-inland-waterways/#6f7b6b0f3101