IDEAS home Printed from https://ideas.repec.org/a/eee/transe/v110y2018icp90-109.html
   My bibliography  Save this article

Strategic integration of the inland port and shipping service for the ocean carrier

Author

Listed:
  • Tan, Zhijia
  • Meng, Qiang
  • Wang, Fan
  • Kuang, Hai-bo

Abstract

This study analytically investigates the competition and alliance strategies between one ocean carrier (OC) and one inland shipping company (IC) in a vertical container shipping chain. The OC decides the freight rate of the deep-sea shipping service, while the IC determines the freight rate of the inland waterway service including the charges of both shipping and port services. We examine and compare the outcomes under three strategies: vertical separation, vertical–horizontal competition and alliance. The if-then entry threat and excess revenue-sharing contract mechanisms for the OC to exercise the vertical-horizontal competition and alliance strategies are proposed, respectively.

Suggested Citation

  • Tan, Zhijia & Meng, Qiang & Wang, Fan & Kuang, Hai-bo, 2018. "Strategic integration of the inland port and shipping service for the ocean carrier," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 110(C), pages 90-109.
    • Handle: RePEc:eee:transe:v:110:y:2018:i:c:p:90-109
    DOI: 10.1016/j.tre.2017.12.010
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1366554517306117
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.tre.2017.12.010?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Álvarez-SanJaime, Óscar & Cantos-Sánchez, Pedro & Moner-Colonques, Rafael & Sempere-Monerris, José J., 2013. "Competition and horizontal integration in maritime freight transport," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 51(C), pages 67-81.
    2. Wang, Fan & Zhuo, Xiaopo & Niu, Baozhuang & He, Jiayi, 2017. "Who canvasses for cargos? Incentive analysis and channel structure in a shipping supply chain," Transportation Research Part B: Methodological, Elsevier, vol. 97(C), pages 78-101.
    3. HEAVER, T. & MEERSMAN, Hilde & MOGLIA, F. & VAN DE VOORDE ,Eddy, "undated". "Do mergers and alliances influence European shipping and port competition?," Working Papers 2000001, University of Antwerp, Faculty of Business and Economics.
    4. Song, Dong-Ping & Lyons, Andrew & Li, Dong & Sharifi, Hossein, 2016. "Modeling port competition from a transport chain perspective," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 87(C), pages 75-96.
    5. Álvarez-SanJaime, Óscar & Cantos-Sánchez, Pedro & Moner-Colonques, Rafael & Sempere-Monerris, José J., 2015. "The impact on port competition of the integration of port and inland transport services," Transportation Research Part B: Methodological, Elsevier, vol. 80(C), pages 291-302.
    6. Lei, Lei & Fan, Chunxing & Boile, Maria & Theofanis, Sotiris, 2008. "Collaborative vs. non-collaborative container-vessel scheduling," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 44(3), pages 504-520, May.
    7. Li, Li & Zhang, Rachel Q., 2015. "Cooperation through capacity sharing between competing forwarders," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 75(C), pages 115-131.
    8. Brian Slack & Claude Comtois & Robert McCalla, 2002. "Strategic alliances in the container shipping industry: a global perspective," Maritime Policy & Management, Taylor & Francis Journals, vol. 29(1), pages 65-76, January.
    9. Franc, Pierre & Van der Horst, Martijn, 2010. "Understanding hinterland service integration by shipping lines and terminal operators: a theoretical and empirical analysis," Journal of Transport Geography, Elsevier, vol. 18(4), pages 557-566.
    10. Bruno De Borger & Denis De Bruyne, 2011. "Port Activities, Hinterland Congestion, and Optimal Government Policies The Role of Vertical Integration in Logistic Operations," Journal of Transport Economics and Policy, University of Bath, vol. 45(2), pages 247-275, May.
    11. Lee, Chung-Yee & Song, Dong-Ping, 2017. "Ocean container transport in global supply chains: Overview and research opportunities," Transportation Research Part B: Methodological, Elsevier, vol. 95(C), pages 442-474.
    12. Martin J. Osborne & Ariel Rubinstein, 1994. "A Course in Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650401, December.
    13. Wang, Xinchang & Meng, Qiang & Miao, Lixin, 2016. "Delimiting port hinterlands based on intermodal network flows: Model and algorithm," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 88(C), pages 32-51.
    14. Notteboom Theo E., 2004. "Container Shipping And Ports: An Overview," Review of Network Economics, De Gruyter, vol. 3(2), pages 1-21, June.
    15. Gelareh, Shahin & Nickel, Stefan & Pisinger, David, 2010. "Liner shipping hub network design in a competitive environment," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 46(6), pages 991-1004, November.
    16. Wang, Hua & Meng, Qiang & Zhang, Xiaoning, 2014. "Game-theoretical models for competition analysis in a new emerging liner container shipping market," Transportation Research Part B: Methodological, Elsevier, vol. 70(C), pages 201-227.
    17. Jianfeng Zheng & Ziyou Gao & Dong Yang & Zhuo Sun, 2015. "Network Design and Capacity Exchange for Liner Alliances with Fixed and Variable Container Demands," Transportation Science, INFORMS, vol. 49(4), pages 886-899, November.
    18. Richa Agarwal & Özlem Ergun, 2010. "Network Design and Allocation Mechanisms for Carrier Alliances in Liner Shipping," Operations Research, INFORMS, vol. 58(6), pages 1726-1742, December.
    19. Lori Houghtalen & Özlem Ergun & Joel Sokol, 2011. "Designing Mechanisms for the Management of Carrier Alliances," Transportation Science, INFORMS, vol. 45(4), pages 465-482, November.
    20. Theo E. Notteboom * & Jean-Paul Rodrigue, 2005. "Port regionalization: towards a new phase in port development," Maritime Policy & Management, Taylor & Francis Journals, vol. 32(3), pages 297-313, July.
    21. Heaver, T. & Meersman, H. & Moglia, F. & van de Voorde, E., 2000. "Do Mergers and Alliances Influence European Shipping and Port Competition?," Research Papers 24175, University of Antwerp, Faculty of Applied Economic Sciences.
    22. Photis M Panayides & Kevin Cullinane, 2002. "Competitive Advantage in Liner Shipping: A Review and Research Agenda," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 4(3), pages 189-209, September.
    23. Tan, Zhijia & Li, Wan & Zhang, Xiaoning & Yang, Hai, 2015. "Service charge and capacity selection of an inland river port with location-dependent shipping cost and service congestion," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 76(C), pages 13-33.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Liu, Weichen & Cao, Youhui & Chen, Jianglong & Guo, Jiaying & Liang, Shuangbo, 2023. "Organization of river-sea container transportation in the Yangtze River: Processes and mechanisms," Journal of Transport Geography, Elsevier, vol. 108(C).
    2. Wang, Shuaian & Yan, Ran & Qu, Xiaobo, 2019. "Development of a non-parametric classifier: Effective identification, algorithm, and applications in port state control for maritime transportation," Transportation Research Part B: Methodological, Elsevier, vol. 128(C), pages 129-157.
    3. Wang, Xinchang & Meng, Qiang, 2019. "Optimal price decisions for joint ventures between port operators and shipping lines under the congestion effect," European Journal of Operational Research, Elsevier, vol. 273(2), pages 695-707.
    4. Zhong, Huiling & Zhang, Fa & Gu, Yimiao, 2021. "A Stackelberg game based two-stage framework to make decisions of freight rate for container shipping lines in the emerging blockchain-based market," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 149(C).
    5. Wang, Kelly Yujie & Wen, Yuan & Yip, Tsz Leung & Fan, Zuojun, 2021. "Carrier-shipper risk management and coordination in the presence of spot freight market," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 149(C).
    6. Bi Wang & Kwai Sang Chin & Qin Su, 2022. "Risk management and market structures in seaport–dry port systems," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 24(1), pages 114-137, March.
    7. Fa Zhang & Yimiao Gu, 2022. "Approach to an Equivalent Freight-Based Sustainable Joint-Quotation Strategy for Shipping Blockchain Alliance," Sustainability, MDPI, vol. 14(16), pages 1-28, August.
    8. Wang, Mei-Ru & Li, Zhi-Chun & Fu, Xiaowen & Xiong, Yi, 2024. "Revenue-sharing in the alliance of inland river and sea carriers: Formulation and a case study," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 183(C).
    9. Wang, Junjin & Xu, Songjun & Wu, Lingxiao & Wu, Sihong & Liu, Yanping, 2024. "Multidimensional container shipping alliance decisions among competitors: Impact of capacity constraints and market competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 190(C).
    10. Shi, Jia & Jiao, Yuquan & Chen, Jihong & Ye, Jun & Gong, Jianwei, 2023. "A study on the evolution of competition pattern of inland container ports along the Yangtze River in China," Journal of Transport Geography, Elsevier, vol. 109(C).
    11. Qu, Chenrui & Zeng, Qingcheng & Li, Kevin X. & Lin, Kun-Chin, 2020. "Modeling incentive strategies for landside integration in multimodal transport chains," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 47-64.
    12. Niu, Baozhuang & Zhang, Jianhua & Xie, Fengfeng, 2024. "Drone logistics’ resilient development: impacts of consumer choice, competition, and regulation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 185(C).
    13. Li, Zhi-Chun & Wang, Mei-Ru & Fu, Xiaowen, 2021. "Strategic planning of inland river ports under different market structures: Coordinated vs. independent operating regime," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 156(C).
    14. Liu, Jiaguo & Wang, Junjin, 2019. "Carrier alliance incentive analysis and coordination in a maritime transport chain based on service competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 128(C), pages 333-355.
    15. Dong, Gang & Huang, Rongbing, 2022. "Inter-port price competition in a multi-port gateway region," Research in Transportation Economics, Elsevier, vol. 94(C).
    16. Dong, Gang & Zheng, Shiyuan & Lee, Paul Tae-Woo, 2018. "The effects of regional port integration: The case of Ningbo-Zhoushan Port," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 120(C), pages 1-15.
    17. Dong, Gang & Ishii, Masahiro & Zheng, Shiyuan & Tezuka, Koichiro & Lee, Paul Tae-Woo, 2024. "Port capacity-sharing decisions in the post-COVID-19 pandemic era," Transport Policy, Elsevier, vol. 147(C), pages 22-31.
    18. Xu, Lili & Lee, Sang-Ho, 2024. "Port supply chain integration under mixed ownership," Transport Policy, Elsevier, vol. 146(C), pages 371-385.
    19. Liang, Jinpeng & Li, Liming & Zheng, Jianfeng & Tan, Zhijia, 2023. "Service-oriented container slot allocation policy under stochastic demand," Transportation Research Part B: Methodological, Elsevier, vol. 176(C).
    20. Fan Bu & Heather Nachtmann, 2023. "Literature review and comparative analysis of inland waterways transport: “Container on Barge”," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 25(1), pages 140-173, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, Jiaguo & Wang, Junjin, 2019. "Carrier alliance incentive analysis and coordination in a maritime transport chain based on service competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 128(C), pages 333-355.
    2. Lee, Chung-Yee & Song, Dong-Ping, 2017. "Ocean container transport in global supply chains: Overview and research opportunities," Transportation Research Part B: Methodological, Elsevier, vol. 95(C), pages 442-474.
    3. Wang, Junjin & Liu, Jiaguo, 2019. "Vertical contract selection under chain-to-chain service competition in shipping supply chain," Transport Policy, Elsevier, vol. 81(C), pages 184-196.
    4. Mohammad Ghorbani & Michele Acciaro & Sandra Transchel & Pierre Cariou, 2022. "Strategic alliances in container shipping: A review of the literature and future research agenda," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 24(2), pages 439-465, June.
    5. Chen, Pingping & Zhao, Ruiqing & Lan, Yanfei, 2022. "E-commerce platform canvassing and service upgrade in an ocean shipping supply chain," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 158(C).
    6. Dung-Ying Lin & Chien-Chih Huang & ManWo Ng, 2017. "The coopetition game in international liner shipping," Maritime Policy & Management, Taylor & Francis Journals, vol. 44(4), pages 474-495, May.
    7. Zheng, Wei & Li, Bo & Song, Dong-Ping, 2017. "Effects of risk-aversion on competing shipping lines’ pricing strategies with uncertain demands," Transportation Research Part B: Methodological, Elsevier, vol. 104(C), pages 337-356.
    8. Zhang, Li-Hao & Zhang, Yang-Guang & Wang, Shan-Shan, 2022. "Ocean shipping company’s encroachment with outsourcing competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 167(C).
    9. Daniele Crotti & Claudio Ferrari & Alessio Tei, 2020. "Merger waves and alliance stability in container shipping," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 22(3), pages 446-472, September.
    10. Dongping Song, 2021. "A Literature Review, Container Shipping Supply Chain: Planning Problems and Research Opportunities," Logistics, MDPI, vol. 5(2), pages 1-26, June.
    11. Chuanxu Wang & Lingli Wang, 2023. "Green investment and vertical alliances in the maritime supply chain," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(7), pages 6657-6687, July.
    12. Antoine Fremont & F Parola & Martin Soppe, 2007. "Vertical adjustments between liner shipping and container handling industry on the global scale: divide et impera ?," Post-Print hal-02123048, HAL.
    13. Qu, Chenrui & Zeng, Qingcheng & Li, Kevin X. & Lin, Kun-Chin, 2020. "Modeling incentive strategies for landside integration in multimodal transport chains," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 47-64.
    14. Roy Van den Berg & Peter W. De Langen, 2015. "Towards an 'inland terminal centred' value proposition," Maritime Policy & Management, Taylor & Francis Journals, vol. 42(5), pages 499-515, July.
    15. Song, Zhuzhu & Tang, Wansheng & Zhao, Ruiqing, 2021. "Liner alliances with heterogeneous price level and service competition: Partial vs. full," Omega, Elsevier, vol. 103(C).
    16. Van den Berg, Roy & De Langen, Peter W., 2011. "Hinterland strategies of port authorities: A case study of the port of Barcelona," Research in Transportation Economics, Elsevier, vol. 33(1), pages 6-14.
    17. Christopher B. Clott & Bruce C. Hartman & Robert Cannizzaro, 2018. "Standard setting and carrier differentiation at seaports," Journal of Shipping and Trade, Springer, vol. 3(1), pages 1-23, December.
    18. Soppé, Martin & Parola, Francesco & Frémont, Antoine, 2009. "Emerging inter-industry partnerships between shipping lines and stevedores: from rivalry to cooperation?," Journal of Transport Geography, Elsevier, vol. 17(1), pages 10-20.
    19. Marion Magnan & Martijn Horst, 2020. "Involvement of port authorities in inland logistics markets: the cases of Rotterdam, Le Havre and Marseille," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 22(1), pages 102-123, March.
    20. Zheng, Shiyuan & Luo, Meifeng, 2021. "Competition or cooperation? Ports’ strategies and welfare analysis facing shipping alliances," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 153(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:transe:v:110:y:2018:i:c:p:90-109. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/600244/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.