Container (Liner) Shipping

Abstract

The establishment of world-embracing container shipping networks has facilitated globalization processes and associated global production and logistics practices. This article discusses the current state and future prospects of the container liner shipping industry. In particular, we discuss demand-supply dynamics in the market; the financial performance, pricing strategies, asset management aspects, and operational strategies of shipping companies; the characteristics of liner service networks; scale increases in vessel size; and horizontal and vertical integration in container shipping. We demonstrate that container shipping lines have developed a very strong focus on market shares and on the lowering of the cost base by ordering ultra large vessels and by focusing on horizontal integration. The increasing “commoditization” of the liner shipping market and low margins are urging shipping lines to consider other growth strategies and revenue models by focusing on supply chain integration/vertical integration, digital transformation and by aiming for zero emission ships. These transformation processes within container shipping lines are not easy, given the weak financial base of most companies.