Balanced Scorecard as the Basis for Global Container Shipping Line IT-Architecture Modeling

A proposed practical fuel budget problem aims to determine a group of bunker fuel budget values for a liner container ship over a round-trip voyage under uncertainties caused by severe weather conditions. According to research collaboration with a global container shipping line in Singapore, the proposed problem holds a kernel position in the ship fuel efficiency management programs advocated by container shipping lines because of the downward pressure of soaring bunker prices. The synergetic influence of sailing speed and weather conditions on ship fuel consumption rate was considered when the bunker fuel budget of a ship over a round-trip voyage was estimated. To address the adverse random perturbation of fuel consumption rate under severe weather conditions, state-of-the-art robust optimization techniques were employed, and a robust optimization model for the fuel budget problem was developed. The developed model can be dualized into a mixed-integer linear programming model that may be solved by commercial optimization solvers. However, algorithmic findings in the field of robust optimization provided a polynomial time solution algorithm, and it was retrofitted to accommodate the proposed ship fuel budget problem. The case study of an Asia–Europe service demonstrates the computational performance of the proposed solution algorithm and the competence of the proposed robust optimization model to produce fuel budget values at different levels of conservatism possessed by the fuel efficiency specialists in container shipping lines.

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.

Container (Liner) Shipping

In 2023, global container shipping trade volume rose compared to 2022, but shipping prices dropped, returning to pre-pandemic levels. Container liner shipping's growth rate outpaced dry bulk and tanker shipping, and its role in international trade grew with multimodal transport development. China's "14th Five-Year" plan for transport services, aiming for over 15% annual growth in containerized intermodal transport, presents new post-pandemic opportunities. Given the capital-intensive and volatile nature of container shipping, an early warning system is crucial to mitigate risks and losses. This paper develops such a system, selects key indicators, sets warning intervals, assesses current market conditions, and uses PSO-LSSVM to predict future risks effectively.

Under-utilization of fleet capacity appears to be a long-lasting issue in the container shipping industry. Also, there are some difficulties unsolved while measuring the ratio of Capacity Utilization (CU) of a container shipping line. From the perspective of an engineering approach, the slots capacity installed is the most popular way to represent the capacity output. Since the slots capacity installed lacks theoretical support, this study adopts an economics model to find the capacity output of a shipping line. Further, the derived CU ratio identifies the realized utilization of fleet capacity for a shipping line. Focused on the three largest container shipping lines in Taiwan, this article shows that their fleet capacity are totally under-utilized and the movement patterns of CU ratios are approximately identical. In addition, the variations of CU ratios also suggest that the enactment of Ocean Shipping Reform Act has contributed a positive effect on the capacity utilization of a container shipping line. Finally, by running a regression model to investigate the determinants of CU ratios, the result indicates that demand condition and global shipping alliance are two critical factors to improve the utilization of fleet capacity for a container shipping line.

In recent years global container shipping saw few major disrupting events that are likely to challenge container shipping business model. First, COVID-19 epidemic caused a major disruption to the global container shipping industry that became challenged by timely delivery of critical life-saving supplies. As a result of Covid-19, container trade volumes and container port volumes have declined over the first months of 2020 with container ship idling rate reaching 15%. Second, the blockage of the Evergreen mega conmanship vessel at the Suez Canal disrupted the global supply chain. Collectively, these events create a basis for questioning the efficiency of a business model relying only on major shipping corridors and using predominately mega containerships. The purpose of this research is to study container shipping along the Northern Sea Route (NSR), which is positioned as one of the emerging global shipping corridors. The Russian Federation is investing in NSR development and planning to launch a subsidized regular container shipment from the Far East to Murmansk or Saint Petersburg along the NSR on a testing base already this year, 2022. This study aiming at investigating the feasibility of container shipping on the NSR using a business model approach, we map existing and future capabilities of container shipping and public acceptance of such shipping by major players. The authors examine changing institutional environment and conduct a survey of major industry players, academia, administrators, and NGOs. The results of the study contribute to the literature on the NSR feasibility and provide practically relevant information to container shipping industry stakeholders.

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

An approach for measuring the optimal fleet capacity: Evidence from the container shipping lines in Taiwan

Shanghai’s container throughput has ranked first worldwide for 13 consecutive years beginning in 2010, indicating that Shanghai has built an international shipping centre capable of allocating resources for global shipping factors. This study considers global container shipping and shipping service networks as research objects to examine the node status and connection directions of Shanghai in these two networks. It also identifies the comparative advantages and weaknesses of Shanghai and proposes countermeasures and suggestions. The results show that Shanghai ranks high in the global container shipping network and is a sub-centre of the Busan system. Shanghai performs well in the mid-to-low-end shipping service industry in the shipping service network; however, a clear gap exists in the high-end service industry between Shanghai and European port cities. Thus, Shanghai should vigorously implement an international development strategy, actively promote a coordinated development strategy between ports, and integrate the construction of the shipping centre with that of financial and technological innovation centres.

Data-driven research on the impact of COVID-19 on the global container shipping network

This thesis proposes a mathematical model that imitates the flow of containers in the container liner shipping network — particularly, in the Indo-Pacific region, where the Strait of Malacca is located — in order to assess the potential impact of the proposed Thai Canal on such a network. This model is constructed based on a combination of two network problems, namely (i) the Multi-commodity Minimum Cost Network Flow Problem (MCNFP) and (ii) the Liner Shipping Fleet Deployment Problem (LSFDP), which allows a more realistic representation of international trade, while taking to account congestion at container ports at the same time. We validate the resulting mixed-integer linear programming model (MILP) using information of the container liner shipping network in 2015, assuming that liners provide their services based solely on the costs. Based on our computational results, the resulting container flows from the proposed model seem to well align with the actual data at the country level — but with some differences at the port level, due to the posed assumption. Once validated, the model is then applied to a network configuration where the Thai Canal serves as an alternative route to the Strait of Malacca. We explore two distinct scenarios: in the first, the Thai Canal reduces transit time by 2 days; in the second, we consider a scenario where the Thai Canal does not offer any transit time savings. Our experimental results indicate that, under both scenarios, the Thai Canal could instigate a substantial shift in traffic volume from the Strait of Malacca — leading to a significant decrease in port calls and transshipment operations of ports around the Strait of Malacca, particularly the port of Singapore.

The authors of the article have chosen a company acting as an agent for a container shipping line because the company seeks to decrease its service failures and reduce the chaotic nature of its activities by systematising them from a scientific point of view and refining its operations at the managerial level. Employees of the company are responsible for activities such as a search for customers, price offers, contacting clients, the conclusion of contracts, coordination of cargo transportation, document control, invoicing and payment control. Proper execution of these operations ensures the quality of services provided by the container line agent. The learning organisation concept, situational management theory and total quality management theory are applicable to the management of the personnel activity process in the line. In terms of management functions, planning is more suitable for activities such as searching for customers, price offers, conclusion of contracts and invoicing; organising is more required when searching for customers, contacting them and concluding contracts; leading is more suitable for activities such as contact with clients, conclusion of contracts and payment control; control is more required when contacting customers, coordinating cargo transportation, invoicing and controlling payment. A conceptual approach that theoretically reveals the principles and possibilities of the company’s activities in the container shipping line can serve as the basis for future empirical research to identify problems in its personnel activity management.

This paper reviews studies from the past 30 years that use operations research methods to tackle containership routing and scheduling problems at the strategic, tactical, and operational planning levels. These problems are first classified and summarized, with a focus on model formulations, assumptions, and algorithm design. The paper then gives an overview of studies on containership fleet size and mix, alliance strategy, and network design (at the strategic level); frequency determination, fleet deployment, speed optimization, and schedule design (at the tactical level); and container booking and routing and ship rescheduling (at the operational level). The paper further elaborates on the needs of the liner container shipping industry and notes the gap between existing academic studies and industrial practices. Research on containership routing and scheduling lags behind practice, especially in the face of the fast growth of the container shipping industry and the advancement of operations research and computer technology. The purpose of this paper is to stimulate more practically relevant research in this emerging area.

Maritime shipping lines and global terminal operators have benefited from economies of scale to expand geographically and functionally their infrastructure, leading to a corporatized network. Terminal operators are key asset managers seeking value creation by expanding the global maritime container terminal infrastructure network. While corporatization has systematically ensured that terminal capacity was created to accommodate the rise in global trade volumes, the network hit its boundaries when confronted with COVID-19 induced global supply chain disruptions. This paper provides a better understanding of the importance of infrastructure and observed corporatization as a framework for explaining economic processes, notably when transport infrastructures are extensive and capital-intensive. The structure of the global container shipping network is analyzed to unveil the realities of liner service networks operated by shipping lines, and the market structure and consolidation in container shipping and terminal operations. The discussion on the corporatization of the global maritime infrastructure network for container handling is embedded in international business literature. This study also extracts the main implications of the current structure and governance of the global maritime infrastructure network for international business policy, with a particular focus on the current market structure and network resilience.

Regional trade co-operation, economic growth and greater political stability have enabled increased container throughput and container port capacity development. Earlier academic work has indicated that the functional position of this port region in the global maritime network might be shifting from a remote region in the periphery of the network to a more intermediate position. This paper aims to analyze the changing level of peripherality and remoteness of the Southern African container port system as part of the global container shipping network. The central hypothesis is that Southern Africa has moved from a remote shipping region to a more central shipping region in the global network. The methodology consists of the calculation of network measures for Southern African ports. The changing geographical distribution of flows among the main container ports in South Africa, Namibia, Mozambique, Mauritius and Madagascar will also be explored in terms of their respective shipping services, port calling patterns, market structure (in terms of the number of active carriers) and the up-scaling of vessel and port capacity. The overall result is a mapped port hierarchical structure with a clear indication of the shifted maritime centrality of Southern African ports from 1996 to the present decade.