Liner Shipping Services Research Articles

Liner shipping antitrust exemptions in the Pacific rim regions: cartelized markets and the need for international coordination

The Pacific Ocean liner shipping market appears to be cartelized, primarily because of antitrust exemptions for shipping companies’ agreements. The current industry consolidation trend driven by economies of scale is likely to nurture the collusion inducing environment further; thus, strengthened competition law enforcement associated with the abolition of the exemption system is imperative. The global nature of the service and the experiences thus far indicate the need for internationally coordinated efforts toward that end. This article first explains the current trends in liner shipping services and various factors affecting the market structure to give the readers the appropriate background knowledge to identify the competitive concerns. The next section examines the legal frameworks adopted by countries in the Pacific Rim region, reviews and assesses competition issues, and proposes legislative and enforcement measures necessary to the sector. The article concludes by outlining concrete proposals to be considered by the Asia-Pacific Economic Partnership (APEC).

Liner Shipping Antitrust Exemptions in the Pacific Rim Regions: Cartelized Markets and the Need for International Coordination

The Pacific Ocean liner shipping market appears to be cartelized, primarily because of antitrust exemptions for shipping companies’ agreements. The current industry consolidation trend driven by economies of scale is likely to nurture the collusion inducing environment further; thus, strengthened competition law enforcement associated with the abolition of the exemption system is imperative. The global nature of the service and the experiences thus far indicate the need for internationally coordinated efforts toward that end. This article first explains the current trends in liner shipping services and various factors affecting the market structure to give the readers the appropriate background knowledge to identify the competitive concerns. The next section examines the legal frameworks adopted by countries in the Pacific Rim region, reviews and assesses competition issues, and proposes legislative and enforcement measures necessary to the sector. The article concludes by outlining concrete proposals to be considered by the Asia-Pacific Economic Partnership (APEC).

Liner shipping cascading effect on Southern African Development Community port strategies

Background: The cascading effect in the liner shipping industry has forced the ply of larger ships to Southern African Development Community (SADC) ports. This requires these ports to revise their strategic development to accommodate the resulting shifts in cargo flows to and from these strategic ports in conjunction with hinterland corridor development.Objectives: The purpose of this research was to understand the changing landscape of strategic SADC ports and develop future strategies with regard to liner shipping services.The main objective was to assess the future development needs of the SADC port system in relation to the cascading effect in liner shipping, linked to the development of hinterland corridors, identifying the limitations and opportunities of each port.Method: Descripto-exploratory research and analysis of secondary data were used. An extensive research of 552 sources (journal articles, research reports, books, newspaper and magazine articles and webpages) dating mostly from the year 2000 onwards were analysed.Results: Durban will remain the preferred container hub port for the foreseeable future if the port can increase its capacity and offer superior customer service in relation to competing ports in the region, such as Maputo, Walvis Bay and Ngqura. Durban is well adapted to accommodate the port and landside requirements resulting from the cascading effect. This is most evident in the depth of the port and port-side handling equipment. The findings confirm that the success of other SADC ports and corridors are subject to regional cooperation and integration without which the dominance of the port of Durban and the Maputo and North–South corridors will continue.Conclusion: The findings of the research indicate that Durban is ideally suited to develop further as a container hub port for the SADC region. This development is subject to a more competitive port landscape in the region as other ports such as Maputo, Walvis Bay and Ngqura improve their liner shipping service offering.

Liner shipping single service design problem with arrival time service levels

We introduce three mathematical models of increasing complexity for designing liner shipping services that guarantee the punctual arrival of vessels at a specified service level. On-time reliability is an important performance indicator for many liner carriers, but current approaches for creating new routes in liner shipping networks do not consider data-driven uncertainty. We perform an empirical analysis of vessel travel times in a real liner shipping network to develop probability distributions that we use within novel, chance-constrained mathematical models for liner shipping service design. Our models are also the first to support variable vessel speeds for service design. In our experiments, we use real-world data from 22 liner shipping routes and evaluate the designed services using a simulation procedure that demonstrates the effectiveness of our approach for reducing lateness. We show that our models can be effectively used for decision support at a tactical level not only for designing services, but also potentially for negotiating maximum demand transit times and prices with customers.

Integrated method for forecasting container slot booking in intercontinental liner shipping service

Intercontinental liner shipping services transport containers between two continents. This paper forecasts the number of containers to be transported through long-haul legs for the incoming trip of an intercontinental shipping service. Considering the clear and unique container slot booking patterns in the historical data, three different forecasting models are developed, including piecewise linear regression model, autoregressive model, and artificial neural network model. These three models are further combined into an integrated model to simultaneously incorporate their merits in formulating the container slot booking patterns. Test results show satisfactory forecasting precisions of the integrated forecasting model.

Column Generation for the Integrated Berth Allocation, Quay Crane Assignment, and Yard Assignment Problem

This study investigates an integrated optimization problem on the three main types of resources used in container terminals: berths, quay cranes, and yard storage space. It presents a mixed integer linear programming model, which takes account of the decisions of berth allocation, quay crane assignment, and yard storage space unit assignment for incoming vessels. In addition, since the majority of the liner shipping services operate according to a weekly arrival pattern, the periodicity of the plan is also considered in the model and in the proposed algorithm. To solve the model on large-scale instances, a column generation (CG) procedure is developed to provide a lower bound for the integrated problem, in which an exact pseudopolynomial algorithm is designed for the pricing problems. Using this procedure, we propose a CG-based heuristic with different solution strategies and apply dual stabilization techniques to accelerate the algorithm. Based on some realistic instances, we conduct extensive numerical experiments to validate the effectiveness of the proposed model and the efficiency of the algorithm. The results show that the CG-based heuristic can yield a good solution with an approximate 1% optimality gap within a much shorter computation time than that of CPLEX. The online appendix is available at https://doi.org/10.1287/trsc.2018.0822 .

A heterogeneous fleet liner ship scheduling problem with port time uncertainty

We deal with a schedule design problem for a heterogeneous fleet liner shipping service under uncertain waiting and handling times at ports. In a liner shipping service, longer than expected waiting and handling times at a port may cause a delay from scheduled departure time. We consider the problem to find the departure times at ports and sailing times of ships between ports so that the total fuel burn is minimized while targeted overall service level (a performance measure based on on-time departure probabilities) is achieved. We consider two new aspects of the problem. The first one is the heterogeneous fleet where each ship type may have different fuel efficiency, i.e. a different fuel burn function. The second one is considering critical ports on the route, i.e. considering the fact that on-time performance at some critical ports might be more important for the shipping company. We propose a model which finds different service levels for different ship type-port pairs by considering importance of ports and fuel efficiencies of ships. We also give a new overall service level measure for the entire route by combining service levels for different ship type-ports pairs. We propose a chance constrained nonlinear mixed integer programming formulation for the problem. Finally, we give computational results that show the effects of several experimental factors on fuel consumption, speed and service level.

Multi-objective optimization for a liner shipping service from different perspectives

Abstract This paper considers the optimization problem for the ship deployment, the planned sailing speed, and the service scheduling in a liner shipping route with both sea and port uncertainties taking multiple objectives from different perspectives. The main purposes are three-folds: first, defining key performance indicators (KPI) in liner shipping service design problem from different stakeholders’ perspectives; second, investigating the relationships between the identified KPIs and their impact on the optimal solutions; third, evaluating the impact of different speed strategies on the KPIs and the optimal solutions.

Logistics Capability, Logistics Performance, And The Moderating Effect Of Firm Size: Empirical Evidence From East Coast Malaysia

Based on the underlying Resource-Based View (RBV) perspective, the main objective of this study is to empirically examine the relationship of logistics capability and logistics performance, and the moderating effect of firm size on this relationship. This study adopted a cross-sectional design and collected quantitative data from a total of 81 logistic service providers (LSP) registered with the Federation of Malaysian Manufacturers (FMM) Directory of Malaysian Industries 2013, from three states (i.e., Kelantan, Terengganu, and Pahang) in Peninsular Malaysia. This study used the Pearson correlation and the moderated multiple regression (MMR) to test if the logistics capability has a significant positive effect on firm performance and the moderating effect of firm size on the relationship between logistics capability and firm performance. Findings of this study revealed that logistics capability has a significant positive relationship with logistics performance. Logistics service capabilities and flexible capabilities delivered by firms are vital for liner shipping services. Moreover, this relationship is significantly affected by firm size, which suggests that, in comparison, the inclusion of firm size (large vs. medium/small LSPs) in the logistics capability – logistics performance relationship has a significant moderating effect in changing the degree (volume) of performance. The moderating effect of firm size is shown to be capable of changing the nature of relationship and explains the conditions in which capability causes LSPs to perform better. The presence of a significant moderating effect of firm size (large and medium/small LSP firms) exceeded the linear relationship between logistics capability and logistics performance. The study has bridged the literature gaps in such a way that it offers empirical evidence on the moderating effect of firm size on the relationship between logistics capability and logistics performance using a Malaysian sample. In order to foster the economic development through effective logistics services, the logistics services development policies and programs should therefore focus on providing a supportive platform for logistics service providers to improve their capacities, which would ultimately lead to better performance and the sustainability of the logistics service providers in Malaysia.

English

The objective of this study is to identify the most influential factors that affect choice of ocean container carrier by freight forwarders. It identifies the most influential factors considered by them when selecting ocean container carriers by analysing data collected from a survey of 105 freight forwarding organisations in Ghana. Exploratory factor analysis is used to identify the underlying factors which influence the selection of carrier. The findings of the study indicate that service quality, document accuracy, freight rates, environmental issues, schedule reliability and quick handling are the most influential factors that guide freight forwarders when purchasing liner shipping service. This study provides a better understanding of these influential factors from the perspective of the freight forwarders themselves. The findings are important to ocean container carriers since they can enable liner shipping companies to channel resources appropriately in response to factors which are identified as determining freight forwarder carrier selection. Key word: Freight forwarders, ocean container carriers, carrier selection factors.

Measuring the perceived container leasing prices in liner shipping network design with empty container repositioning

This paper aims to measure the perceived container leasing prices at different ports by presenting a two-stage optimization method. In stage I, we propose a practical liner shipping network design problem with empty container repositioning. The proposed problem further considers the use of foldable containers and allows the mutual substitution between empty containers to decrease the number of empty containers to be repositioned. In stage II, the inverse optimization technique is used to determine the perceived container leasing prices at different ports, based on the solution obtained in stage I. Based on a set of candidate liner shipping service routes, a mixed-integer nonlinear programming model is built for the proposed problem in stage I. The nonlinear terms are linearized by introducing the auxiliary variables. Numerical experiments based on a realistic Asia-Europe-Oceania liner shipping network are carried out to account for the effectiveness of our two-stage optimization method.

Decision support and data visualization for liner shipping fleet repositioning

Liner carriers move vessels between routes in their networks several times a year in a process called fleet repositioning. There are currently no decision support systems to allow repositioning coordinators to take advantage of recent algorithmic advances in creating repositioning plans. Furthermore, no study has addressed how to visualize repositioning plans and liner shipping services in an accessible manner. Displaying information such as cargo flows and interactions between vessels is a complex task due to the overlap of container demands and long time scales. To this end, we propose a web-based decision support system designed specifically for liner shipping fleet repositioning that integrates an extended version of a state-of-the-art simulated annealing solution approach. Our system supports users in evaluating different strategic settings and scenarios, allowing liner carriers to save money through better fleet utilization and cargo throughput, as well as reduce their environmental impact by using less fuel.

Improving the coastal line passenger traffic management system by applying information technologies

The paper analyses the features of public coastal liner shipping, public transport services in Croatia and the Croatian seaport system. Business processes within the system of public line transport services are analyzed – the management process, the fundamental process (transportation) and the support processes. The shortcomings of the existing system are stated, and improvement of the system by using information technology is proposed. The authors present the necessary adaptations of the public coastal liner shipping system with the goal of increasing system functionality, and the development of management tools (and the public coastal liner shipping services in general) by information system implementation – the appropriately designed information system, combined with standardized system elements. Such system will ensure a higher level of efficiency, together with stability and business continuity.

Combined fleet deployment and inventory management in roll-on/roll-off shipping

In maritime transportation of automobiles, roll-on/roll-off (ro–ro) shipping companies operate liner shipping services across major trade routes. Large ro–ro shipping companies are well placed to offer end-to-end integrated logistics services to auto manufacturers engaged in international trade of vehicles. Therefore, we present a new mixed integer programming model for fleet deployment including inventory management at the ports along each trade route. Due to the complexity of the problem, a rolling horizon heuristic (RHH) is proposed. The RHH solves the problem by iteratively solving sub-problems with shorter planning horizon. Computational results based on real instances are presented.

The impact of seasonal demand fluctuations on service network design of container feeder lines

Customer demand in global supply networks is highly uncertain due to unexpected global and local economic conditions and, in addition, affected by seasonal demand fluctuations for final products. Therefore, in maritime transportation the design of short-sea shipping services for containerized goods has to prove its economic efficiency under varying conditions of transportation demand. Since liner shipping involves significant capital investments and huge daily operating costs, the appropriate design of the service network is crucial for the profitability of the container feeder lines. Usually, quantitative models for shipping network design are based on deterministic forecasts, which are prone to errors caused by uncertainty factors and structural changes in the development of demand. This paper puts special emphasis on the impact of seasonal demand fluctuations on the structure of the related H&S networks, the capacity of the fleet operating within the network, the deployment of ship types as well as on the associated routes of the ships. A simulation and artificial neural network based forecasting framework is developed to support the design of service networks of short-sea shipping lines. The proposed methodology has been tested for a feeder liner shipping service in the East Mediterranean and Black Sea region. Numerical results show that seasonal demand fluctuations have vital impact on the network design of container feeder lines.

Service type assignment and container routing with transit time constraints and empty container repositioning for liner shipping service networks

A decision tool is developed for a liner shipping company to deploy its fleet considering vessel speeds and to find routes for cargos with repositioning of empty containers and transit time constraints. This problem is referred as the simultaneous Service type Assignment and container Routing Problem (SARP) in the sequel. A path-flow based mixed-integer linear programming formulation is suggested for the SARP. A Branch and Bound (BB) algorithm is used to solve the SARP exactly. A Column Generation (CG) procedure, embedded within the BB framework, is devised to solve the linear programming relaxation of the SARP. The CG subproblems arises as Shortest Path Problems (SPP). Yet incorporating transit time requirements yields constrained SPP which is NP-hard and solved by a label correcting algorithm. Computational experiments are performed on randomly generated test instances mimicking real life. The BB algorithm yields promising solutions for the SARP. The SARP with and without transit time constraints is compared with each other. Our results suggest a potential to increase profit margins of liner shipping companies by considering transit time requirements of cargos.

Real-time schedule recovery in liner shipping service with regular uncertainties and disruption events

This paper studies real-time schedule recovery policies for liner shipping under various regular uncertainties and the emerging disruption event that may delay a vessel from its planned schedule. The aim is to recover the affected schedule in the most efficient way. One important contribution of this work is to explicitly distinguish two types of uncertainties in liner shipping, and propose different strategies to handle them. The problem can be formulated as a multi-stage stochastic control problem that minimizes the total expected fuel cost and delay penalty. For regular uncertainties that can be characterized by appropriate probabilistic models, we develop the properties of the optimal control policy; then we show how an emerging disruption may change the control policies. Numerical studies demonstrate the advantages of real-time schedule recovery policies against some typical alternatives.

The Costs of Container Transport Flow Between Far East and Serbia Using Different Liner Shipping Services

Abstract Liner shipping is the most efficient mode of transport for goods. International liner shipping is a sophisticated network of regularly scheduled services that transports goods from anywhere in the world to anywhere in the world at low cost and with greater energy efficiency than any other form of international transportation. Liner shipping connects countries, markets, businesses and people, allowing them to buy and sell goods on a scale not previously possible. Today, the liner shipping industry transports goods representing approximately one-third of the total value of global trade. Ocean shipping contributes significantly to international stability and security. Considering the large and constant struggle in the market in terms of competitive pricing of products, a very important and indispensable role represents the container transport with a clear task to define the final price of the product. This paper analyzes the costs of container transport flow between Far East and Serbia, using different liner shipping services, observing the six world’s largest container operators (Maersk Line, Mediterranean Shipping Company, CMA CGM, Evergreen Line, China Ocean Shipping Company and Hapag-Lloyd) and inland (truck-rail-river) transport corridors. These corridors include distance between selected Mediterranean ports (Koper, Rijeka, Bar, Thessaloniki, Constanta) and Serbia. As a result, in this paper is considered a mathematical model that provides a comparative analysis of transportation costs on the different routes. It is observed already existing transport routes and it is also given hypothetical review to the development of new transport routes. The main goal of this research is to provide an optimal route with lowest transportation cost during container transport. Selection of the best route in the intermodal network is a very difficult and complex task. The costs in all modes of transport and the quality of their services are not constant parameters and changes depending on a number of conditions and characteristics. The analysis of this model within combined maritime and land-based networks would prove helpful for the study of logistics chains, the hinterland-foreland continuum, intermodal transport systems, and market competitiveness.

Joint Planning of Fleet Deployment, Speed Optimization, and Cargo Allocation for Liner Shipping

In this paper, we study a comprehensive model that addresses fleet deployment, speed optimization, and cargo allocation jointly, so as to maximize total profits at the strategic level. Our model considers a general fuel consumption function that depends on speed and load. To overcome intractability caused by nonlinear terms, we further separate fuel cost into two terms associated with ship speed and load to obtain a mixed integer linear programming formulation for approximation. Based on column generation techniques, we develop an iterative search algorithm that adaptively reorganizes the approximated formulation. We conduct extensive experiments using generated data sets from actual liner shipping services in different regions of the world to show the effectiveness of our approach as well as the significant impact of speed-load factors on fuel consumptions. Managerial insights are obtained by testing the model under different scenarios, which may greatly assist decision makers in the liner shipping industry.

Multi-objective optimization for planning liner shipping service with uncertain port times

This paper considers a joint tactical planning problem for the number of ships, the planned maximum sailing speed, and the liner service schedule in order to simultaneously optimize the expected cost, the service reliability and the shipping emission in the presence of port time uncertainty. The problem is formulated into a stochastic multi-objective optimization problem at the operational level. The relationships between the objectives and the decision variables are established. A simulation-based non-dominated sorting genetic algorithm is then presented to solve this problem. A case study is provided to illustrate the results and the application of the model.