Abstract
Through an empirical study of ocean-borne trade between Hong Kong and New York, we combined qualitative and quantitative analysis to examine route selection decisions in a post-expansion era of the Panama Canal. A two-stage methodological framework was developed to assess the competitiveness of the three route alternatives, namely the Panama and Suez canals and the US intermodal system. In the first stage, a combination of literature review and expert knowledge was employed to identify the determinants of route selection. In the second stage, fuzzy theory and the multi-criteria decision-making technique were used to evaluate the criteria and the route alternatives. The results indicate that transportation cost is the most important factor in choosing a route, followed by transportation time, reliability, and route characteristics. The “all water route” via the Panama Canal is preferred over the Suez and U.S. intermodal options.
Highlights
In recognition of the paramount importance of the Asia–Pacific–United States (U.S.) East Coast market, the Panama Canal expansion project has contributed to transit time reduction and accommodation of larger vessels [1,2]
The expansion of the Panama Canal has been of vital importance to global supply chains, and it has been accompanied by changes in maritime and multimodal transport and logistics patterns in the Pacific, but throughout the east–west trade [3,4,5,6]
According to liner shipping companies’ perspective, the highest priority was given to transportation cost when deciding upon the shipping route, as this factor contributes tremendously toward the total cost of cargo transport affecting the profit of the company and freight rates
Summary
In recognition of the paramount importance of the Asia–Pacific–United States (U.S.) East Coast market, the Panama Canal expansion project has contributed to transit time reduction and accommodation of larger vessels [1,2]. In response to the need for efficient supply chain systems, rather than a direct comparison of transportation cost and time [11,13], various qualitative factors, such as reliability, safety, and security are of paramount importance, as mathematical measures have limitations in terms of illustrating numerical values accurately [14] In this respect, our study investigated the determinant factors affecting route selection from Hong Kong to New York with insignificant differences in terms of sailing time and distance among alternatives via the Suez and Panama Canals, based on actual decision makers on route selection in liner shipping companies.
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