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

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.

Companies in the container liner shipping industry actively introduce digital technologies, which have a significant impact on all business aspects of a company. New technologies could become drivers for new business models. The digital transformation requires changes of company IT-architectures, cultures, and organizational frameworks. Monitoring and planning digital transformation processes require a method that allows evaluating the changes in the company's IT-architecture in the context of their compliance with the company's strategic goals. The Balanced Scorecard normally is used as a tool for the strategy implementation assessment. This article proposes the Balanced Scorecard application to measure and plan IT-architecture changes, using it as the basis for the company's digital twin. This tool could provide substantial support for global container shipping line digital transformation planning and monitoring. For the purpose of current study, the authors use the multi-level matrix comparing and linking indicators and IT-architecture models of the global container shipping line.KeywordsDigital twinContainer shipping lineEnterprise architectureBalanced scorecardDigital transformation

Container (Liner) Shipping

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.

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

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.

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.

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.

This paper provides an integrated planning methodology for the optimization of port rotation direction and fleet deployment for container liner shipping routes with consideration of demand uncertainty. We first consider a special case that demand is deterministic. A multicommodity flow network model is developed via minimizing the total network-wide cost. Its decisions are the selection of port rotation direction and fleet deployment and container routings in the shipping network. Afterward, we address the generic case that uncertain demand is considered, which is represented by potentially realizable demand scenarios. We develop a minimax regret model to procure the least maximum regret across all the demand scenarios. The proposed models are applied to an Asia-Europe-Oceania liner shipping network with 46 ports and 12 ship routes. Results could provide the liner company with a comprehensive decision tool to simultaneously determine port rotation direction and fleet deployment when tackling uncertain demand.

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

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.

Vessels face uncertain factors during a voyage, such as bad weather and harsh sea conditions along a route in container liner shipping. As such, the real vessel speed during each leg of a voyage often deviates from the planned one, which may lead to fluctuations in vessel schedule and bunker consumption. This paper investigates the problem of vessel scheduling and bunker management with speed deviations (VSBMSD) for liner shipping in the presence of collaborative agreements. By establishing the worst-case scenario of the maximum bunker consumption function with vessel sailing speed as an independent variable, we develop a mixed-integer nonlinear programming model to minimize the total liner shipping route service cost. A piecewise linear secant approximation method is designed, and then a CPLEX solver is used to solve the problem. The results of the computational experiments conducted for the AEMX route indicate that VSBMSD in the presence of collaborative agreements can enable shipping companies to design vessel schedules reasonably and reduce the total cost of liner shipping route service by at least 2.95% compared to the results from similar studies.

Fleet deployment and demand fulfillment for container shipping liners

Socio-economic impacts of shipping along the Northwest Passage: The cost to locals

The world of container shipping and container terminal business is changing and container ports need to know what the changes are in order to plan how to respond. In particular, the container transport industry has noticed two major developments such as globalization and consolidation. The purpose of this paper is to review the current trend towards globalization and consolidation of container liner shipping and container terminal business. It also investigates the impact of these market developments on container ports and presents its implications for port development, management and operation, and port competition policy. According to the discussion of this paper a greater exercise of market power of container terminal operators will have negative impacts on international trade and national economy, especially port users, including container lines, exporters and importers. An empirical evidence on the exercise of market power is required to develop competition rules on market dominance at a national and international level. This paper suggests 'port coopetition' as a solution for smaller and regional container terminal operators to survive in a competitive business environment.