Exploring decision-making mechanisms for the metro-based underground logistics system network expansion: An example of Beijing

In facing "big-city diseases", using urban underground space to build a stratified transportation system is crucial for the sustainable development of the social economy. In recent years, underground logistics systems (ULS) receive broad attention but developing a purpose-built ULS in megacities faces difficulties due to high costs and risks. As a cost-effective alternative, the metro-based ULS (M-ULS) initiatives provide new visions for the city-wide underground transport integration of passengers and freight. This paper explores the decision-making mechanisms of M-ULS network expansion based on multi-source data collection and mathematical program-ming. A model with three interrelated modules is proposed and applied in the Beijing city case. First, a monetary evaluation framework with 13 flow-based indicators is established to quantify the comprehensive benefits of M-ULS in terms of logistics economics, environment, transportation, urban space expansion, and emergency sup-plies. Second, correlations between metro freight service pricing and market purchase willingness are formulated based on surveys and interviews. Investment budgets and government subsidies are modeled as scenario vari-ables affected by the project's benefits and operating profits. Third, a mixed integer programming model is developed to optimize the multi-period facility location, allocation, and pricing during network expansion. Simulation results show that M-ULS has the ability to fully eliminate the road-based e-commerce distribution in city centers. The urban underground logistics businesses are expected to make metro operations profitable and recover the construction costs of both M-ULS and original metro lines. The project's external benefits are equivalent to 0.8% of the city's GDP, where the most salient contributions come from breaking freight access restriction, energy-saving, efficiency upgrading, pollutant reduction, and traffic mobility improvement. Increasing funding support at the project's early stage can significantly accelerate the system expansion. More findings related to M-ULS facility deployment, pricing mechanisms, and incentive strategies are disclosed.