Optimal Bilateral Cooperative Slot Allocation for Two Liner Carriers under a Co-Chartering Agreement

Abstract

The container liner shipping industry has stepped into an era of international strategic alliances. Important to these liner alliances is the sharing and allocation of container slots between its member carriers. This paper optimises planning of container ship capacity sharing and co-allocation under a co-charting agreement. First, we explain the concept of this business agreement and its implications on maritime operations. Then, we identify key influencing factors that may affect the decisions of cooperative slot co-allocation. The slot co-allocation problem is modelled as an Integer Programming problem and solved using data from two routes between the United States and Asia. The model determines the optimal slot co-allocation strategies between shipping alliance carriers along allied shipping routes. Computational results indicate that the proposed method is effective in obtaining optimal, cooperative slot sharing strategies that can maximise the total system revenue.