Estimation Of Road User Costs Of Freight Vehicles In Ethiopia The Case Of Addis Ababa-djibouti Corridor

Transport cost covers almost two-third of the total logistics costs and so its determination requiresrna through consideration. The objective of this thesis was to estimate the road user costs of freightrnvehicles along the Addis Ababa–Djibouti corridor. Specifically, it was aimed at assessing the existingrnfreightrncostrndeterminationrnprocedurernandrnsuggestrnarnroadrnuserrncostsrnwhichrncouldrnbernarnreference forrndetermination ofrnfreightrnrates.rn The two basic steps in these study were assessment of the existing condition on freight rate determinationrnandrnestimationrnofrnthernroadrnuserrncostsrnbyrnvehicles.rnThernprimaryrndatarncollectionrnmethodrnrnwererninterviewrnandrnquestionnaire,rnwhererndatarnwasrncollectedrnfromrnfiverntransportrncompanies.rnDatarnrnonrnexistingrntariffrndeterminationrnprocedure,rnparametersrnconsideredrnforrntariffrndetermination,rnprofitrnrnmarginrnforrnthernpracticalrnusernandrnexistingrnfreightrnraternbetweenrnthernyearsrn2014-2016rnwererncollected.rnrnSecondaryrndatarnwerernonrntherninputrndatarnofrnHDM-4rnandrnonrncharacteristicsrnofrnthernfreightrnvehiclesrnonrnrnthernrncorridor. The determination of road user costs considered two scenarios, fully loaded andrnempty freight vehicles. For both of the scenarios; a one trip case was taken into account based onrnthe current most common practice. The trip from Addis Ababa- Djibouti was taken to be with emptyrnfreight vehicles while the reverse was assumed fully loaded. Road user costs was assumed to comprise therntravelrntimerncostrnand thernvehiclernoperatingrncost.rnBased on the findings, the common vehicles on the corridor have a capacity between 20-40 tonnes.rnThese freight vehicles are owned either by transport companies or association with a ratio of 1:4.rnAbout 52.5% of the vehicles are between service years of 1-10 while 21.8% of the vehicles arernabove 20 years and the rest are in between. The practical tariff setting procedure is far from scientificrnmethodrnbutrnliesrnonrnestimationrnfromrnthernpreviousrnexperience.rnThernprofitrnmarginrnisrnvariousrnrnwithinrnthernavailablerncompaniesrnandrnrangesrnfromrnarnminimumrnofrn10-15%rntornarnmaximumrnofrnabovernrn35%.rnThernestimatedrnroadrnusedrncostsrnwasrnonrnannualrnbasisrnandrnbothrnfullyrnloadedrnandrnemptyrnrunningrnrnvehicles’rnroadrnuserrncostsrnarernatrnsubstantiallyrnthernsame.rnThernroadrnuserrncostsrnhasrnanrnincrementalrnrnflowrnfromrnyearrntornyear,rnprojectingrntornfivernsuccessivernyearsrnstartingrnfromrnthernanalysisrnperiod.rnThernrnsection-wisernpatternrnofrnthernroad userrncostsrnhasrnsimilarityrnwith therntrafficrnvolume.rnrnIt could be concluded that the current tariff setting practice is unscientific, and this should call forrnattention as the transport cost is the main cost component in the logistics system. The majority ofrnthe vehicles are owned by associations and less by the transport companies. This may call for stimation of Road user costs of freight vehicles: A case of Addis Ababa Djibouti Corridor rnattention for further revision as it was known that the association are less organized. Future researchrndirectionrncouldrnbernonrndeterminingrnroadrnuserrncostsrnconsideringrnbothrnexternalrnandrninternalrnrncostrncomponents,rnandrndetail analysis onrnthernimpactrnof therncurrentrntariffingrnpractice.

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