Less-than-truckload (LTL) carrier-to-carrier
collaboration under uncertainty : A real options
approach
Choungryeol Lee and Srinivas Peeta
 Demand uncertainty is a main source of complexity
in the LTL (load) operational planning context
 A market-based approach on excess capacity is used
to accomplish LTL carrier-to-carrier collaboration in
both capacity surplus and shortage contexts
 An options-based approach is proposed to address
methodological limitations on handling uncertainty
in demand and/or lease rates for excess capacity
• European LTL freight put options for capacity surplus
Operational planning
for existing (load) capacity
Commercial
transaction of
excess capacity