Transport Hub

Hubs, as a network structure, allow a greater flexibility within the transport system, through a concentration of flows. For instance, on the above figure, a point-to-point network involves 16 independent connections, each to be serviced by vehicles and infrastructures. By using a hub-and-spoke structure, only 8 connections are required. The main advantages of hubs are:

• Economies of scale on connections by offering a high frequency of services. For instance, instead of one service per day between any two pairs in a point-to-point network, four services per day could be possible.
• Economies of scale at the hubs, enabling the potential development of an efficient distribution system since the hubs handle larger quantities of traffic.
• Economies of scope in the use of shared transshipment facilities. This can take several dimensions such as lower costs for the users as well as higher quality infrastructures.

Many transportation services have adapted to include a hub-and-spoke structure. The most common examples involve air passenger and freight services which have developed such a structure at the global, national and regional levels, such as those used by UPS, FedEx and DHL. However, potential disadvantages may also occur such as additional transshipment as less point-to-point services are offered, which for some connections may involve delays and potential congestion as the hub becomes the major point of transshipment.

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