Abstract
Shipping lines are under pressure to expand the geographical reach of their services and to invest in value added services. The former, addressed by a number of strategies including slot charters, alliances and mergers and acquisitions, has been quite widely treated in the literature. The ways in which the lines are enhancing the range of their services has been subject to less study and is the focus of this paper. Viewed within the context of the economics of vertical integration, the paper reviews the organisation strategies of lines in relation to terminal management, intermodal services and logistics services. There is only close integration with shipping in the management of dedicated terminals and intermodal services. With one exception, P&O Nedlloyd's Value Added Services, the management of logistics services remains ostensibly quite distinct from shipping. In terms of pricing practices, this is reality but it leaves uncertain the level and ways of sharing information and resources related to logistics. The interest of lines in developing new relationships with shippers will place further pressure on collective pricing practices in liner shipping.
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