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Offshore consolidation centre for air cargo operations: model and solution methods

Author

Listed:
  • Xin Chu

    (National University of Singapore)

  • Yuan Wang

    (Singapore University of Social Sciences)

  • Yun Hui Lin

    (Agency for Science, Technology and Research (A*STAR))

  • Ek Peng Chew

    (National University of Singapore)

Abstract

Recent years have witnessed a surge in demand for air cargo transportation. Air cargo terminals initially built for handling the former demand volume start struggling with low operational efficiency and high congestion due to limited capacity. The industry has explored methods such as building new terminals and renting warehouses to stay competitive in the market. However, these methods may not be practical in many scenarios due to economic reasons and the scarcity of airport land. As an alternative method, this paper investigates an innovative operational paradigm with the concept of Offshore Consolidation Centre (OCC) to deal with the imbalance between the surging demand and the limited capacity of air cargo terminals. We redesign air cargo terminal operations with the existence of OCC and formulate the problem as a mixed-integer linear program (MILP). We then propose a two-stage alternating algorithm embedded with a tailored metaheuristic to analyse the validity of our model and algorithm. Experiment results reveal that our alternating algorithm has the best performance compared with the solver and benchmark policies adopted in industrial practice. Moreover, the comparison with air cargo terminals without OCC demonstrates that OCC can reduce delays, cargo waiting time, and traffic flow, by a large margin.

Suggested Citation

  • Xin Chu & Yuan Wang & Yun Hui Lin & Ek Peng Chew, 2024. "Offshore consolidation centre for air cargo operations: model and solution methods," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 46(4), pages 1295-1327, December.
    • Handle: RePEc:spr:orspec:v:46:y:2024:i:4:d:10.1007_s00291-024-00764-0
    DOI: 10.1007/s00291-024-00764-0
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    References listed on IDEAS

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