Container Liner Shipping Research Articles

Sailing Speed and Fleet Deployment Optimization for Intercontinental Container Liner Shipping Considering Cargo Time Value

Abstract This article collectively addresses the issues of optimizing the sailing speed of containerships and fleet deployment in intercontinental container liner shipping, taking cargo time values into consideration. A mixed-integer nonlinear programming model is developed to maximize the gross profits of a container shipping line. The sailing speed is divided into 0.1 knot intervals and a reciprocal-discretization method is proposed to transform the model into an integer-based linear programming model, which can be solved using optimization solvers such as CPLEX. A case study is conducted based on the Far East-West America liner route of a global container shipping line to assess the effectiveness of the proposed model and the reciprocal-discretization method. The results show that when the cargo time value is taken into consideration, the increased sailing speed of containerships on long legs and the decreased number of deployed containerships will generate greater operating profits for the container shipping line. The rise in bunker price will lead to a stepwise decline in sailing speed of containerships and a stepwise growth in the number of deployed containerships. Moreover, the downward trend of sailing speed due to the increase of bunker price will be somewhat delayed as the unit container cargo value increases. Several useful insights are drawn from analysis of the results.

Yield Management by Reconstruction of Cargo Contribution for Container Shipping

This study provides a cargo contribution yield management model to solve the ship capacity control problem for the container liner shipping industry. We propose a new objective to optimize cargo contribution to replace the focus on total revenue or average revenue in the current research. We reflect the special characteristics of yield management in container liner shipping, and all cost items were identified and calculated to develop a new cargo contribution evaluating system. We propose a mathematical model for service route segments’ allocation distribution based on cargo contribution. We use a genetic algorithm to solve the model further with comparative analysis with actual practice. The study cultivates new ground in the current literature with a wide range of innovative applications at a practical level.

Service recovery and customer satisfaction in container liner shipping industry - an ordered logit approach

This paper assesses the responsiveness of service recovery process to customer satisfaction in container liner shipping (CLS) industry. The research deals with real-world business events, conducted using a survey method, in which customers evaluate service recovery scenario and complete a questionnaire with respect to CLS carriers they had recently patronised. Estimated by ordered logit regression method, the results show that timeliness of communication is the most significant service recovery attribute. It also finds that customers in different segments prefer receiving recovery resources in different ways; effective service recovery could help improve customer satisfaction and service recovery paradox exists in the industry. The findings contribute to the understanding of theoretical explanation of service recovery attributes and provide managers with useful guidelines for establishing effective recovery process. Unlike other research, this paper draws on data from actual customers in CLS industry and therefore benefits from increased external validity.

Optimizing the Stowage Planning and Block Relocation Problem in Inland Container Shipping

The stowage planning and block relocation problem (SPBRP) consider the relations between stowage planning and block relocation comprehensively, in which the retrieval sequence of containers in yard and the stowage plan of a ship are concerned. In this paper, an integer programming formulation called SPBRP-I is presented for the proposed problem in inland container liner shipping to minimize the total number of relocations in yard and re-handles in ship. To deal with the utilization preference in inland shipping, the minimization of ship stack occupancy number is introduced into SPBRP-I to develop a new model called SPBRP-II. In view of the complexity of problem-solving, a heuristic algorithm (HA) based on priority sorting, retrieval and local search strategies is proposed to achieve the efficient optimization. The algorithm consists of three parts including the yard container retrieving, yard container relocation and ship stowage planning. Finally, the container liner shipping on the Yangtze River is chosen with some typical ships for the case study. Numerical results show that SPBRP-II performs better than the original SPBRP-I, and it's more suitable for solving the small-sized cases. Compared with the models, the algorithm with retrieval strategy RS1 (HA_RS1) can achieve the efficient problem solving with high-quantity solutions and very short computational time.

Service recovery and customer satisfaction in container liner shipping industry - an ordered logit approach

Service recovery and customer satisfaction in container liner shipping industry - an ordered logit approach

Schedule Reliability in Liner Shipping Timetable Design: A Convex Programming Approach

Container liner shipping is the primary mode of moving manufactured products across continents. Partly due to inherent uncertainties at sea and ports, the liner shipping industry has long had a notorious reputation of schedule delays and unreliable on-time performance. This paper formulates a new approach to incorporate schedule reliability targets in liner shipping timetable design, to balance bunker consumption, time taken for the voyage, and schedule delays. We first model a surrogate problem using a copositive program through a moment decomposition approach and solve it as a convex semidefinite programming relaxation. We next incorporate schedule reliability targets implicitly by exploiting the optimality condition of this surrogate model. We use this approach to analyze the trade-offs between the bunker consumption and the schedule reliability targets for each port call. Furthermore, we derive the optimal speed of the vessel in each leg of the schedule to control for total bunker consumption. Surprisingly, the analytical analysis shows that, if a shipping line has the freedom to choose its preferred berthing times at all ports, it is optimal to set design sailing speeds equal at all legs to maximize schedule reliability. We validate our model using data from a Daily Maersk service, and demonstrate that our schedule can achieve an even higher schedule reliability than the innovative Daily Maersk service schedule, which attained more than 98% reliability in practice, with 11.4% lower bunker consumption. In comparison with a common schedule design heuristic, our model can design service schedules that improve the reliability performance by at least five percentage points, consuming the same amount of bunker. For the same reliability target (of 80%) in schedule design, our model can help reduce bunker consumption by about 11.6% for an 11-week schedule. The savings in bunker consumption can be much more substantial when an ocean carrier aims for higher schedule reliability.

Optimal port call adjustment for liner container shipping routes

Container shipping companies usually alter their shipping networks in response to the seasonally changing shipping demand and freight rate. Rather than redesigning their shipping networks from scratch, they often choose to make small adjustments to the shipping routes by skipping some ports or adding additional calls to several ports. Inspired by above industrial practice in shipping network alteration, this study solves the port call adjustment problem (PCAP) to determine which port calls should be removed and which should be inserted for each route of a shipping network under the new shipping market patterns. A two-phase solution method is developed for the PCAP. In Phase 1, the candidate port calls for removal and insertion operations in each shipping route are determined. In Phase 2, the port call adjustment strategy is obtained by solving a mixed integer linear programming (MILP) model to select the port calls from these candidates identified in Phase 1 for actual removal and insertion operations. Considering the difficulties in solving the MILP model efficiently, two heuristic methods are also proposed to give near-optimal solutions in an acceptable computational time. Numerical experiments demonstrate that the proposed two-phase method is able to find a port call adjustment strategy that significantly reduces the operating cost.

Exploratory data analysis for the cancellation of slot booking in intercontinental container liner shipping: A case study of Asia to US West Coast Service

In an intercontinental container liner service, container shipping operators reserve container slots for the customers who book capacity for their cargoes a few weeks before the ship depart from a particular port. In practice, some of these bookings are finally cancelled without loading any containers onto the ships, which leads to a low loading rate and revenue loss. However, deep analyses of container slot booking cancellation in container liner services rarely appear in the literature due to the lack of real data. The characteristics and patterns of the container slot booking cancellation are unclear from both academic and managerial perspectives. To fill this gap, this study first proposes a conceptual model for the container slot booking cancellation analysis in intercontinental shipping services. A case study on a container liner service between Asia and US west coast is then conducted based on the proposed model. The static and dynamic cancellation rates of voyage, the attributes of bookings, and the factors that may influence the cancellation behaviours are inspected and discussed. The primary findings of this study will benefit both the academic research on container shipping slot bookings and the practices of the slot cancellation control in container shipping company.

Revenue management for container liner shipping services: Critical review and future research directions

The purpose of revenue management (RM) is to maximize revenue growth for a company by optimizing product/service availability and prices based on micro-level forecasting of customer behavior. Seat/cargo capacity control and air ticket/cargo pricing are two primary RM research topics that have yielded fruitful models and solution methods for air transportation, which have been used by airlines for around 50 years. However, the RM studies for container liner shipping services and their application are scant although the operations of airlines and container shipping lines are quite similar. We therefore introduce the fundamental RM models developed for air transportation, namely, capacity control and pricing models. Based on these models, we proceed to critically review the RM studies for container liner shipping services. Finally, we identify valuable future research directions in container shipping RM.

Service characteristics and customer satisfaction in the container liner shipping industry

This research is mainly devoted to investigating key service characteristics in the container liner shipping (CLS) industry and its impact on customer satisfaction. It maps service quality dimensions to a new set of service characteristics based on the latest priorities of container liner shipping companies. The data collected through online survey is regressed in a non-linear model. The results indicate that the top three service characteristics influencing customer satisfaction are (1) quality of customer service representative, (2) quality of digitalisation and (3) quality of sales representative in that order. The research also suggests that the ability to offer long term rates is not effective in enhancing customer satisfaction as it is usually perceived; digitalisation tops the liner shipping managers’ agenda.

Intercontinental Liner Shipping Service Design

Intercontinental liner container shipping service connects trades between different continents in the global logistic system. This paper proposes a single intercontinental service design problem that aims to jointly determine the optimal serviced ports from a set of candidate ports, the port rotation, the ship sailing speed on each voyage between adjacent serviced ports and the number of containers transported for each type of shipping demand. A mixed integer linear programming model is formulated for the proposed problem based on mild assumptions to maximize the service profit, which is calculated as the freight revenue minus the total operating cost that includes port stay cost, container handling cost, bunker consumption cost, and other ship operating costs. The formulated model is also able to produce a service route with a more general topological structure than the simple cycle or butterfly cycle routes considered in most current studies. In view of the unique features of the model, a tailored and exact branch-and-cut algorithm is developed based on Benders decomposition to expedite the model solution. Numerical experiments demonstrate the efficiency of the developed branch-and-cut algorithm and show the applicability of the proposed model for designing the intercontinental liner shipping services. The e-companion is available at https://doi.org/10.1287/trsc.2018.0831 .

Multi-stage hierarchical decomposition approach for stowage planning problem in inland container liner shipping

The relatively limited capacities of inland container liner shipping mean that, unlike in maritime container shipping, capacity utilisation is more important than scheduling. Capacity utilisation and stability must be considered in the stowage planning problem in inland container liner shipping. We adopt a multi-stage hierarchical decomposition approach to decompose the problem into multiple stages because a ship needs to visit multiple ports during its voyage. At each stage, the stowage planning problem of the current port is decomposed hierarchically into two sub-problems: the master bay planning problem (MBPP) and slot planning problem (SPP). The multi-port MBPP is first optimised to simultaneously generate the master bay plans for multiple ports over the full route. This approach incorporates two heuristic algorithms, a greedy randomised adaptive search procedure for the multi-port MBPP, and a heuristic evolutionary strategy algorithm for the SPP. Computational results for randomly generated data corresponding to real-size scenarios of inland container ships are presented validating the proposed algorithms.

Vulnerability analysis of global container shipping liner network based on main channel disruption

ABSTRACTThe Malacca Strait, the Suez Canal and the Panama Canal play an important role in the global container shipping. To study the impact of main channel interruption on the container shipping, we analysed statistical data on all routes operated by the top 100 global container liner companies and constructed a network model. We selected four topological metrics to measure the network’s connectivity and used the network weekly total shipping capacity and average shortest shipping time to measure the network’s transportation capacity and transportation time. The interruption of the main channel is simulated, and the changes in the metrics are analysed. The results indicated that the network’s vulnerability is sensitive to main channel interruption. If the Malacca Strait is interrupted, the network’s prosperity degree fall by almost half and the network’s transportation time increase by more than a quarter if the Suez Canal is interrupted. In addition, East Asian and European container liner shipping have more than 50% dependence on the Malacca Strait and the Suez Canal. Moreover, the container transport time between ports in East Asia, Europe, and North America and the rest of the world increases by an average of 4–9 days in the main channel interruption.

Overbooking and delivery-delay-allowed strategies for container slot allocation

Due to uncontrollable markets and unreliable factors in liner container shipping industry, the deviation between the actual and estimated shipment demand of containers always exists, resulting in a waste of shipping capacity or unfulfilled shipping requirements. To tackle such a slot allocation problem, this paper proposes overbooking (OB) and delivery-postponed (DP) strategies to maximize profits. Then, two corresponding multi-period models are developed and solution algorithms are presented. Finally, several numerical experiments are carried on to show the applicability of the proposed models and solution algorithms. The results indicate that the OB and DP strategies can promote the profit.

The Virtual Container Yard: A complimentary tool to optimize consolidation in shipping

Unlike in other ship types, the container ships cannot offer their services without containers and the shipping space become ineffective. Therefore, containers and slots are complimentary and indispensable service component in liner container shipping. The virtual container yard (VCY) is a modern concept and an effective CIM solution that underpins the collaboration between carriers. Carriers already have common platforms to interchange slots thus it is just one fine step away from implementing the similar strategy for containers. It is, through these findings, expected to change the carriers’ myopic view about the container interchange. The actual container statistics in Sri Lanka was extracted from the industry as the source of input for the study. The paper reveals that the VCY could reduce the inventory management cost by 19 percent. Carriers opted to interchange the container slots in cellular ships more than three decades ago. This paved the way for strong collaboration between carriers and provided many financial advantages. It helped in securing economic advantages through scale of economies in highly completive shipping industry. This paper provides empirical evidences of the financial savings of container interchange under different container sizes and types.

Subloop-based reversal of port rotation directions for container liner shipping network alteration

Container liner shipping network alteration is a practical manner of shipping network design, which aims to make minor modifications to ameliorate the existing network. In a generic liner shipping network with butterfly ports, each ship route is separated into a set of subloops on the basis of its structure and internal butterfly ports. Reversing the subloop directions has an impact on the network-wide cost including inventory cost, transshipment cost, and slot-purchasing cost. This paper proposes a new destination-based nonlinear model for the subloop-based reversal of port rotation directions with the objective of minimizing the overall network-wide cost. We prove that the addressed problem is NP-hard. Next, the model is transformed to an equivalent mixed-integer linear programming model. Based on the structure of the reformulated model, we develop a Benders decomposition (BD) algorithm and a metaheuristic method to solve practical-size instances. Three acceleration strategies are incorporated into the BD algorithm, which are adding Pareto-optimal cuts, updating big-M coefficients and generating combinatorial Benders cuts. Case studies based on three small examples and an Asia-Europe-Oceania liner shipping network with a total of 46 ports are conducted. Results show that the problem could be efficiently solved by the accelerated BD algorithm and the optimization of subloop directions is conducive to decreasing the network-wide cost especially the inventory cost.

Operational and geographical dynamics of ports in the topology of cruise networks: The case of Mediterranean

Geography is an integral part of the cruise industry since cruises are conducted in the geographical space and thus are submitted to spatial and geomorphological constraints. However, the cruise-literature lacks of research focusing on the geographical aspect of the interactions existing between ports and cruise companies. This paper attempts to fill this gap by examining the spatial networks of two contemporary cruise companies operating in the Mediterranean, using complex network analysis that has been extensively applied to other shipping sectors, such as to the container liner shipping, but not, in a comprehensive context, in the cruise industry. The complex network analysis applied in this paper provides insights about the operational and geographical dynamics of the ports participating in the Mediterranean cruise network, which can help the cruise companies and the port authorities to comprehend and to measure their competitive position in the network. The overall approach develops a novel classification of ports according to their integration in the cruise network, an optimized modularity segmentation of the Mediterranean market by considering both operational and geographical aspects of this network, and an in-depth efficiency comparison between the spatial networks of the cruise companies.

A RESEARCH ON OPERATIONAL PATTERNS IN CONTAINER LINER SHIPPING

This article studies operational patterns in container liner shipping with the emphasis on End-To-End (ETE), Round-The-World (RTW), and pendulum patterns. The first research issue deals with their deployment on designing shipping routes on the East–West corridor. The second issue compares their operational characteristics to realize their strength and weakness. The empirical work is carried out using 2074 route records of the top 20 shipping lines from 1995 to 2011. During the period, ETE was the dominant pattern. From 81 to 93% of the surveyed routes operated under this pattern. Pendulum was in favour in the early 2000s, but its use later declined. Round the world had been expected as an innovation in the industry but it was employed limitedly. An important feature of RTW and pendulum patterns is to include multiple trades on a single route, which can bring about the advantages of traffic bundling and less fleet requirement. On the other hand, multiple trades result in more complexity of these patterns, displayed through long voyage distance and time, a greater number of visited regions and more ports of call. Additionally, the deployment of mega vessels is also restricted due to traffic discrepancy between trade lanes.

Swedish shippers\u2019 strategies for coping with slow-steaming in deep sea container shipping

When container shipping lines experience over-capacity and high fuel costs, they typically respond by decreasing sailing speeds and, consequently, increasing transport time. Most of the literature on this phenomenon, often referred to as slow-steaming, takes the perspective of the shipping lines addressing technical, operational and financial effects, or a society perspective focusing on lower emissions and energy use. Few studies investigate the effects on the demand side of the market for container liner shipping. Hence, the aim of this study is to elaborate on the logistics consequences of slow-steaming, particularly the strategies that Swedish shippers purchasing deep sea container transport services employ to mitigate the effects of slow-steaming. Workshops and semi-structured interviews revealed that shippers felt they had little or no impact on sailing schedules and were more or less subject to container shipping lines’ decisions. The effects of slow-steaming were obviously most severe for firms with complex supply chains, where intermediate products are sent back and forth between production stages on different continents. The shippers developed a set of strategies to cope with the low punctuality of containerised shipping, and these were categorised in the domains of transfer-the-problem, transport, sourcing and distribution, logistics and manufacturing, and product design. All firms applied changes in the transport domain, although the lack of service segmentation limited the effects of the strategy. Most measures were applied by two firms, whereas only one firm changed the product design.

Container shipping in period of Freight Conference breakup

The most important development in the liner shipping industry last 10 years was the repeal of the block exemption that Liner freight conferences had received in the European Union (EU) with regard to price and capacity settings. From of 18 October 2008, former members of the Far East Freight Conference have had to establish their specific rates and freight additions, resulting in different rates and amounts applied across the board. This paper examines the general conditions of competition in a market economy, as well as special conditions for competition in the market for liner transportation, regarding descriptive analysis summarized the available information on the subject. The study is based on EU documents, official EU reviews, and paper of international researchers on the issue of current state and prospects of liner shipping market development. In particular, the history of the emergence and formation of linear conferences and overviews the European Union decision and impact of the repealing it’s block exemption from European competition law for Liner shipping conferences. As a result, the causes and implications were identified of these changes to liner container shipping industry.