Magnetic Levitation Cargo Ransport Role in World Economy

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Background: Currently, the car, water, railway, air and pipe transports are used for cargo and goods transportation. Each kind of cargo transport has its own specific competitive advantages that provide its most effective application at various stages of logistics chain. The economic efficiency of cargo transportation influences the overall economic efficiency, in particular, the gross domestic product. The quality of economic growth as applied to transport branch and its input to the national economy is relevant, since with the current organisation of different transport modes interaction, there are still high transaction costs.

Aim: Study of influence of various modes of transport, including maglev transport, on the economy and economic growth.

Methods: Theoretical and empirical. The paper considers the influence of various modes of transport, that operate in the cargo transport sphere, on the country’s economy. The comparison of existing modes of transport with the maglev transport from the point of view of desired effects is made.

Results: The maglev transport possesses new properties and advantages, which makes it possible to view is as viable and able to provide a qualitative economic growth and resource-based economy if realised.

Conclusion: The most efficient use of resources, the consumption of which should at least not increase and at most decrease, is achieved with the introduction of maglev transport into the transport system, as its economic properties already now excel those of the majority of other types of transport. It is obvious, as to the experts, that in transition to resource-based economy the maglev transport will be major transport for both cargo and passenger transit.

Full Text


The magnetic levitation technologies over the recent years have acquired a special significance for the scientific and technical society. Discussions around them do not cease, and this is caused considerable improvement of these technologies and their practical application in a number of states (China, South Korea, Japan). The results of introduction of maglev-based technologies to transport industry vary depending on country peculiarities and influence on functioning of other modes of transport.

 Currently, maglev is used only in passenger transit. Transportation of cargo is provided by car, water, railway, air and pipeline transport. Other modes of cargo transport have lost their importance (e.g. horse-driven transport) or did not acquire widespread application (e.g. conveyor transport). Cargo transportation can be of either mass or single scale [1, 2, 3].


Each type of cargo transport has its competitive advantages that ensure the most effective application of a transport at each stage of logistic chain. In some cases transport modes can be interchangeable, and be integrated into multimodal transportation having very high efficiency.

The most considerable features of various types of cargo transport are listed in the Table 1. The main difference between the types of cargo transport lies in the infrastructure used. The infrastructure performs an important role in logistic chains and affects cargo transportation economics [4, 5].  


Table 1. Characteristic features of cargo transport types

Characteristics of cargo transport 

Type of cargo transport







Infrastructure peculiarities

Common roads

Basically, natural waterways; ports required

Special infrastructure, weight limits

Natural way; airports required

Special infrastructure

Transportation peculiarities

Door-to-door without special schedule

Between ports, considering port of call schedule

Between cargo stations, according to strict schedule

Between airports, according to strict schedule

Between input and output points, continuous

Transport mode peculiarities

Wide range with different load capacities and container volumes

Large capacity

Standardised rolling stock

Standardised transport means of limited nomenclature

No transport means

Nomenclature of goods transported

Wide, limited by sizes and lifting capacity

No limitations

Wide, limited by sizes and lifting capacity

Wide, limited by sizes and lifting capacity

Liquid, granular cargo, gases

Traffic peculiarities

Free schedule

As per navigation conditions

As per train schedule




Dependence on weather and road conditions

Dependence on weather conditions

Dependence on weather conditions

Dependence on weather conditions



High accident risks

Relatively high


Relatively high



Large emission volumes

Mean emission volumes

Mean emission volumes

Mean emission volumes

Low emission volumes


Examples of cargo logistics and transport infrastructure, which is a technological complex for organisation of cargo traffic and rendering of transport and logistic services, are illustrated in Fig. 1.


Fig. 1. Examples of cargo transport and logistics infrastructure


The configuration of logistic chains is formed by transport and logistic infrastructure types, and transportation conditions and requirements. From the point of view of logistics, the most complicated stages are those touching distribution of cargo, and the major transport is often not in the focus of attention [6]. This is explained by the necessity to achieve local operational efficiency, which dominates in the classical approach towards cargo transportation economics (Fig. 2).

The classical approach towards cargo transportation economics takes into account the main cost centres and various effects that influence the transport costs. The effects are divided into a group of additive effects and a group of multiplicative effects (Fig. 2). Additive effects concern extensive transport costs factors, that enable improvement of service quality, but require additional capital investment and operational costs.


Fig. 2. Cargo transportation economics


The main idea is that the price for logistic chain is added up with all of its stages. The stage price is influenced by its main characteristics. For transport echelons, it is a distance, for warehouses it is storage life.

The multiplicative effects are of different nature and have interest rate as their main rate. These effects have a greater influence on the final product price. For instance, the single month transport interest rate makes up to 0.5% out of the cargo price. At the distribution stages that follow, both increase of interest rate and value added tax is observed, which leads to increase of the final product price. It is these effects that this study focuses on.

The configuration of the transport market participants is given in Fig. 3. In consideration of the market on a broader scale, the number of participants is much bigger, than the number of participants directly involved in the transportation process. The integral participants of the transport market are also the sender and the receiver.


Fig. 3. Transport market participants


The market participants interact with each other in the issues relating to transport and logistics infrastructure, rolling stock and vehicles, resources, and raw materials. The market is regulated by regulatory framework, which determines its development and peculiar features of operational activity [7, 8].

The interests of operating companies, on the one hand, and those of service companies, manufacturers and suppliers, on the other hand, are the opposite. The conflicts are observed in the following aspects:

  • infrastructure stability;
  • availability of rolling stock and vehicles;
  • life cycle of rolling stock and vehicles;
  • resources and raw materials.


There is also a potential conflict connected with extension of transport and logistics infrastructure. The situations when one and the same company operates, services the infrastructure and thus takes all internal conflicts are not considered. All conflicts are compromise point where all companies seek appropriate balance. The rest of the companies are not involved in the process and, despite the rules, suffer from transaction costs.

The final product price is determined by a group of various interconnected costs. The multiplicative effect manifests itself in the increase of price for each following stage of transportation process due to increase of price for each of the preceding stages.

Each transport echelon includes the costs of various types of services, including the profitability of service companies. The cost of service includes the cost of raw materials and resources, including the manufacturers’ rate of return and the cost of transportation, as well as the rate of return of transport companies.

Transportation costs are clearly not the largest part of the cost of the final product, but they can lead to a rise in costs by several per cent.

Thus, at first glance, the problem described negatively influences the economy. However, further analysis shows that the situation is much more complex.

The role of transport in the Gross Domestic Product (GDP) as the main factor characterising the final price for all services rendered and products manufactured in the country, is extremely high (Fig. 4).


Fig. 4. GDP and cargo transportation


The share of cargo transportation in GDP may reach 25 %, transport costs in the product price – 10 %. The transport itself consumes up to 25 % of production capacity.

The essence of economic growth is presented in Fig. 5. Traditionally, economic growth is the mirror of GDP growth. At the same time, irrespective of the approach used to calculate GDP (whether it is cost or value added based (production method), the result is the same value.


Fig. 5. Economic growth


The economic efficiency of cargo transportation influences the overall economic efficiency. However, inefficient system, from the viewpoint of transaction costs, leads to GDP growth (Fig. 6). Notwithstanding the employment rate and consumption from the viewpoint of prices and increase of investment are observed, the negative side is the lower quality economic growth and different level of efficiency of the market participants [10].


Fig. 6. GDP growth due to market participants’ interests


The influence of maglev transport on the cargo transportation market and, consequently, on GDP considerably differs from the same influence of the currently operated modes of transport (Table 2). Measurement of positive effects, such as economic growth quality and intermediate consumption, is a complicated task [11]. Whereas, the level of negative outcomes (reduction of wages fund in service field, investment, depreciation, company’s profit in maintenance and construction, and resources consumption) is calculated.


Table 2. Level of interaction of maglev transport with other participants of operation as compared to other types of cargo transport

Object / stakeholder

Rolling stock maintenance

Rolling stock maintenance


Infrastructure operation company

Higher stability

Lower risks of emergency situations


Transportation operation company

Optimal routes

Less maintenance of rolling stock


Manufacturing and construction company

Less contracts

Less maintenance


Rolling stock maintenance company

Less damage to rolling stock

Less maintenance


Infrastructure maintenance company

Less maintenance

Less damage to infrastructure



Lower demand

Lower demand



Thus, the economic growth issue in terms of transport industry and its contribution to national economy requires searching for a combination of the most efficient modes of transport. This, in its turn, requires changing the economic paradigm to a resource-based one, where the long-term interests providing social proliferation will be brought to the foreground. The model in which the short-term interests are stood for, which damage economy and society, should belong to the past, as not viable from the strategic standpoint [12, 13, 14, 15].


The volume of consumption of resources by humanity has long outweighed their recovery capacities. In this regards, one of the most significant tasks of transport and industry is to minimise consumption of natural resources, as well as to minimise the impact of emission on environment. This requires structural modifications in the transport industry, that is implementation of innovative modes of transport.

The need to reduce consumption of resources so as to eliminate the emerging problems in the ecosystems, will inevitably foster broad implementation of maglev transport, that possesses relevant advantages over other means of cargo and passenger transport. Since economic characteristics of maglev transport, including that being operated in several countries, and that whose technical and technological parameters are being developed, already now excel economic properties of the most types of transport, it can be stated that during transition to resource-based economy maglev transport will be the main transport in both cargo and passenger transportation.


The work has been completed with support of Scientific Educational and Engineering Cluster “Russian Maglev”.

About the authors

Sergey A. Smirnov

Emperor Alexander I St. Petersburg State Transport University

Author for correspondence.
ORCID iD: 0000-0002-2096-6967
SPIN-code: 3042-2910

Russian Federation, St. Petersburg

Leading Researcher

Olga Yu. Smirnova

Emperor Alexander I St. Petersburg State Transport University

ORCID iD: 0000-0002-2239-4384
SPIN-code: 9083-2984

Russian Federation, St. Petersburg

Senior Researcher


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Supplementary files

Supplementary Files Action
Fig. 1. Examples of cargo transport and logistics infrastructure

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Fig. 2. Cargo transportation economics

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Fig. 3. Transport market participants

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Fig. 4. GDP and cargo transportation

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Fig. 5. Economic growth

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Fig. 6. GDP growth due to market participants’ interests

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Copyright (c) 2019 Smirnov S.A., Smirnova O.Y.

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