Zony Yulfadli, Muhammad Zainul Arifin, Ludfi Djakfar, Achmad Wicaksono
The large dimensions and extra weight frequently encountered on the Pantura line create a need for policymakers to intro-duce allowances for logistics transportation services using government-subsidized funds, particularly directed at railway logistics services transporting goods on this route. This study focuses on optimizing subsidy allocations to KALOG (the Indonesian Train Logistics Company) by examining three key factors: logistic railway service expenses, the distance between industrial centers and the nearest KALOG facilities, and truck operational costs. These elements are instrumental in enhancing KALOG’s profitability while reducing issues related to overdimensioning and overloading along the Pantura line. Centered in Jakarta, which also serves as the na-tion’s logistics hub, the railway network extends to major cities including Tangerang, Bandung, Semarang, Yogyakarta, and Suraba-ya, offering substantial potential to improve the efficiency and reliability of rail freight in Indonesia. The study uses an optimization simulation to determine the optimal percentage for subsidy allocation, aiming to maximize profitability and, in turn, benefit both KALOG’s capital accumulation and Indonesia’s broader economic infrastructure. Numerical estimates generated in the simulation indicate that reallocating subsidies toward rail transport rather than highway logistics can lower operational costs significantly and reduce traffic congestion and road damage on highways in the Pantura region. Additionally, by adjusting for increased demand in logistics railway services through measures such as adding more wagons or improving infrastructure, the subsidy allocation model enhances rail transport’s economic viability. The results provide a clear picture of the impact that a targeted optimization strategy can have on both the performance and competitiveness of logistics companies – particularly in the rail sector. Through continuous innovation, adapting to market changes, and prioritizing high-quality services, logistics companies not only enhance their compe-titive edge but also contribute to long-term, sustainable growth, benefiting Indonesia’s logistics sector and national development. © The Author(s) 2025.
Department of Civil Engineering, University of Brawijaya, Veteran str, Malang, 65145, Indonesia
