Dynamic Pricing System for Physical Internet Enabled Hyperconnected Less-than-Truckload Freight Logistics Networks

Abstract: Less than truckload shipping plays a critical role in modern supply chains by consolidating freight from multiple shippers into shared vehicles. Despite its operational flexibility and potential sustainability benefits, the LTL sector faces persistent challenges, including high per unit costs and financial instability, as evidenced by recent industry bankruptcies. This paper investigates two structural issues limiting LTL performance, including the constrained consolidation potential imposed by proprietary logistics networks, and the inefficiency of fixed pricing models that fail to reflect realtime network conditions. To address these, we explore a Physical Internet enabled, hyperconnected LTL logistics system based on open asset sharing and dynamic flow consolidation. We then propose a dynamic pricing framework tailored for this network. Through a simulation based study grounded in Freight Analysis Framework data and cost estimates from industry sources, we evaluate system performance across three demand and cost uncertainty scenarios in the Southeastern U.S. The results validate our system effectiveness and suggest a promising path forward for building more efficient LTL logistics operations.