The Chilean Mine Disaster Relief Supply Chain: A UPS Case

by Steve Banker

October 21st, 2010

The mine disaster in Chile that trapped 33 miners captured worldwide attention. The cave-in occurred on August 5th. Initially, officials in Chile announced a plan to get the miners out by the end of the year. Subsequently, they came up with two alternate plansB and C. I spoke with Chip Chappelle, Director of Humanitarian Supply Chain Logistics at UPS, about UPSs role in supporting Plan B. UPS played a role in this disaster relief supply chain because it is more than a small package courier company: UPS has air and ocean freight, freight forwarding, and LTL and TL capabilities based on several acquisitions. Here is the timeline and associated events: September 2nd: The Chilean embassy contacts UPSs Washington office to see whether the company could transport 20,000 pounds of mining equipment, representing seven drills, from Center Rock Inc. of Berlin, Pennsylvania to the mine located 500 miles north of Chile. Chip became involved with this request shortly after the call was made. Thursday, September 2nd through Tuesday, September 7th: Chip explored a series of options on how to move the equipment to Chile. The initial thought was to load all of the equipment into an ocean container and load it on a plane. One advantage of this approach was shipment integrityi.e., the seven drills would stay together and not be misplaced. The ocean container could also serve as a pop up warehouse at the mine. However, special planes are required to airlift ocean containers and this would be very expensive. The UPS team developed an alternate plan to move the equipment on separate pallets, which would be 10 to 20 percent of the cost of moving a large container. UPS assured the Chilean Embassy and the manufacturer/shipper that it could provide shipment integrity with a palletized move. During this time period, UPS also explored which airport to fly out of and

how to transport the goods to the departing airport, as well as from the Santiago airport to the mine.

The Drills are Palletized to Save Money (Source: UPS; click to enlarge) Tuesday, September 7th: Center Rock informs UPS that the equipment has been manufactured and would be ready for pick-up the next day. A tractor trailer rig with a two driver team had been on hold in Pennsylvania waiting for this notification. Within 24 hours, the rig arrived at the Miami airport and the shipment was loaded onto a LAN Chile Cargo plane, UPSs air cargo provider to Chile. Friday September 10th: The plane departs on schedule at 06:54 and arrives in Santiago by 17:40 local time. Drillers Supply, the organization coordinating Plan B was the receiving entity. Drillers Supply cleared the goods through customs, and UPS de Chile loaded the equipment into two trucks for the journey north to the mine.

The drills depart from Miami (Source: UPS; click to enlarge) Saturday, September 11th: The drills arrive at 12:00 at the mine. Because of congestion, they are not unloaded until 17:00.

The drills arrive in Chile (Source: UPS; click to enlarge) Sept. 11th through October: There were 6 subsequent flights to Chile through the Miami, JFK, and Houston airports. UPS picked up the tab for the first shipment. Subsequent loads were flown at a deep disaster relief discount. October 12th: Plan B turns out to be the successful planthe miners are freed! In conclusion, disaster relief supply chains have become a hot topic of research in academia over the past five years. NGOs and governments are also funding or conducting research in this area. Chip stressed that in disaster relief supply chains, getting a clear understanding of the needs/requirements and maintaining good communications with all parties in the supply chain are the key principles for driving success.