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Impact of scale increase of container ships on the generalised chain cost

Author

Listed:
  • Edwin Van Hassel
  • Hilde Meersman
  • Eddy Van de Voorde
  • Thierry Vanelslander

Abstract

In recent years, an increase in the size of the container ships could be observed. The question is how these larger ships will influence the total generalised costs from a port of loading to a destination in the European hinterland. The second question is whether a scale increase of the container ships on other loops, such as a loop from the United States to Europe, has the same impact on the generalised chain costs as on the loop from Asia to Europe. A derived question is which element of the total chain has the highest importance, and whether this balance varies as the ship size changes. In this article, a model is developed that allows answering the above research questions. The model is designed to simulate the cost of a complete loop of a container ship and of a chain that uses that same loop. For the chain cost simulation, the maritime part is determined by the loop. From the ports of loading and unloading, the port container handling and the hinterland transportation costs are also integrated. The model also allows calculating the total chain cost from a point of origin (either a hinterland region or a port) to a destination point (also a port or a hinterland region). An actual container loop of a container shipping company can be introduced in the model. An application is made to two existing container loops, namely from Asia respectively the United States to Europe. It turns out that changing ship does indeed lead to economies of scale, but also that the impact is larger on the Asia--Europe connection than on the US--Europe connection. Furthermore, the maritime component has the biggest share in the total chain cost, but as ship size increases, the shares start getting closer to each other. This research contributes to the existing literature in two ways. First of all, it quantifies the impact of the scale increase of container ships throughout the total chain. Second, this is done from a bottom-up engineering modelling approach.

Suggested Citation

  • Edwin Van Hassel & Hilde Meersman & Eddy Van de Voorde & Thierry Vanelslander, 2016. "Impact of scale increase of container ships on the generalised chain cost," Maritime Policy & Management, Taylor & Francis Journals, vol. 43(2), pages 192-208, February.
  • Handle: RePEc:taf:marpmg:v:43:y:2016:i:2:p:192-208
    DOI: 10.1080/03088839.2015.1132342
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    Citations

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    Cited by:

    1. Santos, Tiago A. & Guedes Soares, C., 2019. "Container terminal potential hinterland delimitation in a multi-port system subject to a regionalization process," Journal of Transport Geography, Elsevier, vol. 75(C), pages 132-146.
    2. Raja Oloan Saut Gurning & Gunung Hutapea & Edward Marpaung & Johny Malisan & Dedy Arianto & Wilmar Jonris Siahaan & Bagas Bimantoro & Sujarwanto & I Ketut Suastika & Agoes Santoso & Danu Utama & Abdy , 2022. "Conceptualizing Floating Logistics Supporting Facility as Innovative and Sustainable Transport in Remote Areas: Case of Small Islands in Indonesia," Sustainability, MDPI, vol. 14(14), pages 1-22, July.
    3. Sergi Ros Chaos & Athanasios A. Pallis & Sergi Saurí Marchán & David Pino Roca & Agustín Sánchez-Arcilla Conejo, 2021. "Economies of scale in cruise shipping," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 23(4), pages 674-696, December.
    4. Katrien Storms & Christa Sys & Thierry Vanelslander & Ruben Deuren, 2023. "Demurrage and detention: from operational challenges towards solutions," Journal of Shipping and Trade, Springer, vol. 8(1), pages 1-31, December.
    5. Dariusz Bernacki & Christian Lis, 2021. "Exploring the Sustainable Effects of Urban-Port Road System Reconstruction," Energies, MDPI, vol. 14(20), pages 1-23, October.
    6. Takuya Yamaguchi & Ryuichi Shibasaki & Hiroyuki Samizo & Hisanari Ushirooka, 2021. "Impact on Myanmar’s Logistics Flow of the East–West and Southern Corridor Development of the Greater Mekong Subregion—A Global Logistics Intermodal Network Simulation," Sustainability, MDPI, vol. 13(2), pages 1-22, January.
    7. van Hassel, Edwin & Vanelslander, Thierry & Neyens, Kris & Vandeborre, Hans & Kindt, Dominique & Kellens, Stefan, 2022. "Reconsidering nearshoring to avoid global crisis impacts: Application and calculation of the total cost of ownership for specific scenarios," Research in Transportation Economics, Elsevier, vol. 93(C).
    8. Jiawei Ge & Mo Zhu & Mei Sha & Theo Notteboom & Wenming Shi & Xuefeng Wang, 2021. "Towards 25,000 TEU vessels? A comparative economic analysis of ultra-large containership sizes under different market and operational conditions," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 23(4), pages 587-614, December.
    9. Dariusz Bernacki, 2021. "Assessing the Link between Vessel Size and Maritime Supply Chain Sustainable Performance," Energies, MDPI, vol. 14(11), pages 1-21, May.
    10. T. A. Santos & G. Lopes Santos & P. Martins & C. Guedes Soares, 2022. "A methodology for short-sea-shipping service design within intermodal transport chains," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 24(1), pages 138-167, March.
    11. Joost Hintjens & Edwin van Hassel & Thierry Vanelslander & Eddy Van de Voorde, 2020. "Port Cooperation and Bundling: A Way to Reduce the External Costs of Hinterland Transport," Sustainability, MDPI, vol. 12(23), pages 1-16, November.
    12. Guerrero, David & Thill, Jean-Claude, 2021. "Challenging the shipper's location problem in port studies: An analysis of French AOC wine shipments to the US," Journal of Transport Geography, Elsevier, vol. 91(C).

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