We propose a novel hub location model that jointly eliminates the traditional assumptions on the structure of the network and on the discount due to economies of scale in an effort to better reflect real-world logistics and transportation systems. Our model extends the hub literature in various facets: instead of connecting non-hub nodes directly to hub nodes, we consider routes with stopovers; instead of connecting pairs of hubs directly, we design routes that can visit several hub nodes; rather than dimensioning pairwise connections, we dimension routes of vehicles; and rather than working with a homogeneous fleet, we use intermodal transportation. Decisions pertinent to strategic and tactical hub layout and transportation network design are concurrently made through the proposed optimization scheme. An effective branch and cut algorithm is developed to solve realistic size problem instances in the Turkish network and to provide managerial insights.
View Hub Location and Route Dimensioning: Strategic and Tactical Intermodal Transportation Hub Network Design