Framing the Nexus of Globalisation, Logistics and Manufacturing in Europe

Abstract

Under the ongoing influence of globalisation, supply chains have changed significantly. New logistics and manufacturing systems have emerged, causing longer transport distances and increasing transport emissions. The existing research into the sustainability impacts of freight transport has largely viewed it as being a macro-level economic and political phenomenon and has ignored the interdependencies amongst micro-level economic actors, including firms and businesses in the private sector. In this paper, we presume that the lack of conceptualisation of freight transport in relation to wider institutional contexts and firm behaviour results in the lack of a holistic approach to understanding freight governance in the face of globalisation. We argue for the use of institutional economic geography lenses to elucidate the distribution networks of emerging logistics and manufacturing practices and its implications for freight transport. We illustrate our argument through a broad look at the European logistics and manufacturing practices and global production.

Keywords:

• freight transport governance
• logistics
• manufacturing
• European Union freight policy
• offshoring
• transport consolidation
• intermodal transport

Acknowledgements

We would like to thank the EC — DG MOVE for the generous funding they provided to conduct the LM project, which this paper refers to as a case study. We would like to extend our gratitude to all LogMan project partners, particularly to Stephan Helmreich for initiating and successfully coordinating the project.

Notes

1. Carbon leakage is defined as “the increase in CO₂ emissions outside the countries taking domestic mitigation action divided by the reduction in the emissions of these countries” (IPCC, 2007).

2. The use of the institutional aspect to economic geography of global production and consumption is already justified on the grounds of different conceptualisations of space (Harvey, 2004). If the role of space in global production was only related to territorial boundaries, say China as a bounded territory, the institutional perspective would be redundant. Agreeing with the relevance of the conception of space to the spatial patterns of logistics and manufacturing activities as well as freight transport, the relational notion of space is also relevant in this case. Harvey (2004) describes the relational conception of space as a form of space that cannot exist on its own without the relations that define them. A brief example in freight transport would be the EU-wide vehicle size regulations and how they are translated into nation-wide regulations in the respective countries, which then leads to differential costs due to different forms of negotiations amongst different stakeholders depending on the origin and destination and country of registration of a vehicle.

3. The limitations of the LM project should be noted. Logistics trends for energy-efficient supply chains have not been considered for non-EU countries mainly due to a lack of data for those countries and regions. Such countries are only now developing expertise in energy-efficient supply chains. A further limitation is that the project did not take into account future structural changes in the world economy that may take place, which may favour the services sector at the expense of the manufacturing sector. Such changes may also have an impact on the demand for freight transport services and on the type of freight transport services required. However, although these limitations provide useful insights for future research in this area, it does not have implications for the purposes of this paper as the LM project is only employed as a case study to illustrate the conceptual framework.