Abstract
This study examines the conditions that influence the choice between direct shipment and transshipment, focusing on two factors: geographical distance and demand. We develop a two-stage model comprising shipping lines and shippers, and apply it to a virtual maritime network with one origin, two destination ports, and one hub port. The generalized costs of shippers in the optimum direct shipment and in transshipment for the shipping lines model are compared to evaluate the choice between direct shipment and transshipment. We find that competitiveness of the port as a hub, indicating the cargo volume aggregated in transshipment, is essential for examining the cost-effectiveness of direct shipment and transshipment. The comparison between the cost-effectiveness of direct shipment and transshipment is based on the configuration of each network, especially in terms of frequency and the vessel size deployed. Direct shipment can be more cost-effective for short distances.
Highlights
Maritime shipping networks comprise two types of transport systems: direct shipment and transshipment
This study aims to examine the conditions that influence the choice between direct shipment and transshipment, focusing on two factors: geographical distance and demand
We develop a two-stage model comprising shipping lines and shippers, and apply it to a virtual maritime network with one origin, two destination ports, and one hub port
Summary
Maritime shipping networks comprise two types of transport systems: direct shipment and transshipment. Direct shipment involves a carrier transporting cargo from the origin to destination using a single service. The carrier transports cargo from the origin to destination by combining multiple services. The carrier aggregates several services in an intermediate port, called a hub, and transports the cargo via this hub, combining the appropriate services. As transshipment cargo needs to be transported via one or more additional ports to arrive at the destination port, it involves additional navigation distance, navigation time, port charges, and stevedoring charges (Hsu and Hsieh 2005). The number of shipping services required to connect all points of origin and destination in transshipment is fewer than in direct shipment.
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