Abstract
This study examines the financially feasibility of the proper terminal capacity by each berth size of the automatic container terminal (ACT) from the perspective of Terminal Operating Company (TOC). ACT is a highly productive and eco-friendly port facility, but it requires a lot of capital investment. Thus, the investment of ACT should consider the TOC’s operating profit preservation to determine the proper terminal capacity. In this study, we attempt to conduct financial analysis using the net present value method and estimate breakeven handling volume of five berth sizes (nine, five, four, three, and two berths). In particular, as the aim of this study is to propose a capacity model of ACT, the model must be able to adapt to a variety of situations reflecting the number of berths and financial discount rate. The case study focused on the new port of Busan, introducing ACT. As a result, the breakeven terminal capacity changes from 560,421 TEU of the 9-berth model to 633,102 TEU of the 2-berth model, applying a 4.5% standard discount ratio. In a sensitivity test considering the change in discount rate and the size of the berth at the same time, the net present value (NPV) has a positive value at the level of at least 550,000 TEU (nine berths and 3.5% discount rate) and up to 650,000 TEU (two berths and 5.5% discount rate). The method of optimizing financial efficiency by analyzing the appropriate loading capacity will be an important support tool in decision-making by providing the analysis results and reasonable information obtained during the analysis process to the TOC, the main stakeholder in the adoption of ACT.
Highlights
The remarkable changes in the global port and logistics market are economies of scale due to the enlargement of ships and cost reduction through minimizing dwell time at ports [1,2]
This study suggests financial model of automated container terminal (ACT) for finding the proper terminal capacity considering investments, expenses, and profits incurred in relation to the ACT business through the net present value (NPV) method
Due to the Fourth Industrial Revolution, the port environment has changed a lot, and it is expected that there will be more rapid changes in the future. Advanced ports such as European Container Terminal in Rotterdam, Netherlands and Container Terminal Altenwerder in Hamburg, Germany are increasing the use of ACT as an important part of smart ports
Summary
The remarkable changes in the global port and logistics market are economies of scale due to the enlargement of ships and cost reduction through minimizing dwell time at ports [1,2] In response to these changes, major ports in each country are improving the efficiency of port operation by introducing automated container terminal (ACT) systems [3]. ACT systems based on advanced technology are being introduced mainly in countries such as the Netherlands, Germany, USA, and China which have world-class advanced port infrastructure, and Korea is introducing automated terminals in the new port of Busan [4]. The Korean government has introduced ACT for stages 2–5 and 2–6 of the new port of Busan by benchmarking the ACT already in operation
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