Hub Network Design in a Cooperative Environment

Abstract

As an important strategic decision, the design of the hub network directly affects the transportation efficiency and costs of the entire network. Sharing resources to reduce costs through cooperation is the future development of logistics and transportation networks. From the perspective of horizontal cooperation, this paper focuses on the hub location problem of two carriers sharing hub facilities in a cooperative environment. A mixed-integer programming model with minimum total network cost in a cooperative environment is constructed. Numerical examples demonstrate that the supplementary cost due to cooperation will affect the result of cooperation. When the supplementary cost is within a specific range, the cooperative network is more cost-effective than non-cooperative networks.