Expansion in cargo handling: geographical and functional issues

Intense co-operation as well as severe competition are two characteristics of the current sea-port cargo-handling sector. This paper contributes to remedying the lack of understanding of the effects that such strategies may have on operating conditions in the sector. It analyses the geographical strategies pursued by the major operators up to 2006, as well as the functional directions in which co-operation is sought. It appears that most domestic ventures for the majority of container-handling operators are non-co-operative ones, except for PSA and HPH. Abroad, all of the cargo-handling operators except DPA/CSXWT have more co-operative than non-co-operative ventures. As to nationality of acquired subsidiaries, it is observed that most co-operative ventures have two nationalities involved. In terms of functional direction of operations, the major container-handling companies, except APM Terminals, start up most of their co-operative ventures with non-cargo-handling partners. Furthermore, it can be observed that HPH, APM Terminals, P&O Ports and DPA/CSXWT have started up, acquired or merged with more limited companies in cargo-handling than in non-cargo-handling activities. Most of the non-horizontal partners in cargo-handling ventures appear to be industrial or investment companies. PSA's, Eurogate's and DPA's non-cargo-handling ventures predominantly are in logistics. Combining geography and functional direction graphically shows that the major operators have had very diverging strategies. The two extremes are Eurogate, with a network which is solely focused on Europe, and P&O Ports, covering all continents.     

Korean liner shipping in the era of global alliances

In the course of the last two decades Korean shipping has emerged as a major player in the liner market. In 1970 there was not a single container ship in the Korean fleet; yet, within the next two decades, shipping companies from Korea have become included among the top 10 liner operators in the world, in the context of a spectacular ascent of Asian companies in international container shipping. During the same period the organization of liner shipping itself underwent major changes. In the 1970s and 1980s, pools and powerful consortia prevailed, maximizing frequency and optimizing fleet deployment under pressure from the high investment entailed by containerization. The era of consortia, however, came to a close in the early 1990s; intermodalism and the expansion of the major liner companies into forward and backward segments of the transport chain rendered them inflexible for pursuing individual strategies of product diversification with a view to larger market shares. Global alliances were finally born as a result of a major reshuffling of co-operation agreements and of the globalization of the production process on the demand side. The aim of this paper is to follow and assess the options available to an aggressive low-cost national fleet in its journey to competitive maturity through a period of changing organization of liner shipping, focusing on the course of the leading Korean container company, and one of the largest in the world today, Hanjin. It highlights at the same time both the deep structural changes which liner shipping has undergone in the last two decades and the effects of current changes, such as the recent wave of mergers in this sector.     

上海组合港集装箱码头的竞争与协调

<正>1997年9月29日,横跨上海、浙江、江苏三省市的港口集装箱码头的行政管理机构——上海组合港管理委员会在上海宣告成立。 上海组合港以上海为中心,江苏和浙江为两翼,具体范围包括:上海吴淞口以下,江苏省南京长江大桥以下的长江水域以及浙江省宁波、舟山地区水域已建成和规划建设的集装箱泊位的深水岸线。但不包括黄浦江内港区。上海组合港现有20个集装箱泊位,通过能力为320万TEU,今后将保持一定的上升趋势。     

Liner alliances in the globalization era: a strategic tool for Asian container carriers

There has been an increased interest recently in alliances as successors of the large consortia that used to operate in the context of the conference system. Today, having become a common means and term of co-operation in a variety of other industries, alliances are posited as the response of the supply side of liner shipping to important changes on the demand side; alliances have, thus, become predominant in the most important routes for container cargoes. In recent years, however, the list of major container traffic generators and the list of major carriers of containerized cargoes have begun to contain more common entries, generally originating from the Asian region. Asia is, however, a large continent and the entrance of Asian carriers into liner shipping has not been simultaneous; the position, strategies and co-operation strategies of Asian companies have more differences than they share common features. Nevertheless, this paper suggests that alliances are a distinct form of co-operation in liner shipping and the empirical evidence based on a survey in the region supports this hypothesis. The similarity of attitudes of the major Asian container carriers vis a vis alliances is in this way revealing in terms of the range of motivations for participating in the alliance system in a globalized transport environment.     

Port co-opetition in concept and practice

The port industry has undergone a rationalization process over the last decade. An increasing proportion of port management and operations is being taken over by global port operating groups. Many port operators who previously ran only their local business now extend their business scope to the regional or global scale; today's port operators can be regarded as multinational corporations. In the era of global economy, a port no longer enjoys a natural monopoly, as was the case in the past. To cope with this changing business environment, a certain form of competition and co-operation among ports is necessary so as to provide services that fit into shipping lines' strategies. It is suggested that ports have to concentrate on new ways for co-operation in an effort to establish a countervailing power. This paper proposes a new strategic option known as co-opetition , the combination of competition and co-operation, for the port industry, and explains a case of co-opetition between the container ports in Hong Kong and South China. The results of this research will provide a useful insight into the port industry, which is currently required to carry out its business in an ever-changing business environment.     

港口的区域垄断和竞争:圆周模型

港口具有一定的地理垄断性,同时港口竞争也日益加剧,交叉腹地日益扩大。区域垄断和竞争成为港口共同的发展特征,协调两者之间的关系对于港口产业发展具有重要意义。圆周模型对于分析港口产业经济特性非常恰当。通过运用圆周模型来理解港口的区域垄断和竞争特性,可以为实现港口产业规模型竞争的公共政策制定提供基础性的理论依据。具体的政策建议包括港口业务的垂直分解及构建地主港模式、加快港口民营化进程、在放松规制的同时重建规制及推动形成区域内邻近港口间的协同竞争关系。     

Port co-opetition in concept and practice

The port industry has undergone a rationalization process over the last decade. An increasing proportion of port management and operations is being taken over by global port operating groups. Many port operators who previously ran only their local business now extend their business scope to the regional or global scale; today's port operators can be regarded as multinational corporations. In the era of global economy, a port no longer enjoys a natural monopoly, as was the case in the past. To cope with this changing business environment, a certain form of competition and co-operation among ports is necessary so as to provide services that fit into shipping lines' strategies. It is suggested that ports have to concentrate on new ways for co-operation in an effort to establish a countervailing power. This paper proposes a new strategic option known as co-opetition, the combination of competition and co-operation, for the port industry, and explains a case of co-opetition between the container ports in Hong Kong and South China. The results of this research will provide a useful insight into the port industry, which is currently required to carry out its business in an ever-changing business environment.     

Flagging options for the future: A turning point in Korean shipping policy?

The issues surrounding the future of Korea's shipping policy have been heavily debated since 1990 because the Korean shipping industry has been facing rising crew costs and difficulties in recruitment of qualified crew, an adverse taxation system, very limited access to foreign capital markets, and an inflexible government regulatory environment. Consequently, this has contributed to the deterioration of Korea's compectitive edge. This paper aims to provide both an account of the current adverse situtation in Korean shipping business and proposals to alleviate the plight of shipping enterprises. Within the context of that adversity, two solutions are suggested to improve the current situation, by either establishing a Korean second register or flagging out. The paper explores the advantages and disadvantages of each solution. Because ship management is closely interrelated to flagging strategies, the paper also discusses areas of co-operation between Korean shipping or ship management companies and advanced foreign ship management companies.     

Network economies in liner shipping: the role of home markets

This paper deals with the measurement of the network complexity of some selected shipping groups, also identifying the contribution of co-operative agreements among carriers. The empirical investigation is focused on: (i) the analysis of the distribution of the carrying capacity per range; and (ii) the comparison of that capacity with the throughput handled in the port facilities of the group. These variables are interpreted in the light of the impact that alliances have on the geographical wideness of the services supplied by each partner. This factor also allows to depict how the cultural and political origin of shipping lines affects the decision of joining an alliance and the outcomes deriving from such co-operation.     

Network economies in liner shipping: the role of home markets

This paper deals with the measurement of the network complexity of some selected shipping groups, also identifying the contribution of co-operative agreements among carriers. The empirical investigation is focused on: (i) the analysis of the distribution of the carrying capacity per range; and (ii) the comparison of that capacity with the throughput handled in the port facilities of the group. These variables are interpreted in the light of the impact that alliances have on the geographical wideness of the services supplied by each partner. This factor also allows to depict how the cultural and political origin of shipping lines affects the decision of joining an alliance and the outcomes deriving from such co-operation.     

Risk perception affecting the performance of shipping companies: the moderating effect of China and Korea

Risks in the shipping industry have been highlighted and have attracted significant attention, especially following the bankruptcy of Hanjin in 2017. Due to the decrease in container volume, the business environment for large shipping companies in China has deteriorated. Therefore, major large shipping companies have implemented mixed ownership reform, which provides more opportunities for large Korean shipping companies to enter the Chinese shipping industry. This study first identifies risk perception, specifically focusing on the moderating effect of Chinese and Korean shipping companies, and then demonstrates the impact of these risks on shipping company performance. The results show that market, operational, and technical risks have a negative influence on Chinese shipping companies, whereas market, policy, financial, operations, and technical risks have a negative influence on Korean shipping companies. This study contributes to the fundamental understanding of the effect of risk perception on performance among shipping companies in both countries and calls for further research on risk management plans based on the risk factors identified herein. On a practical level, this study provides an important reference for operators and investors who seek to enter strategic alliances or joint venture in Chinese shipping industry.     

我国港口面临的主要问题和差距

<正>改革开放以来,现代港口建设取得长足进步,做出了历史性贡献,但与我国现代化和综合交通运输业战略发展要求相比,无须讳言,尚有相当的差距,特别是要建设有中国特色社会主义现代化,在加速“两个根本转变”中,当前港口内外面临着诸多深层次矛盾,困难和问题差距,其中包括: 1.货源不足 管理粗放 其直接原因:一是传统陆上腹地经济结构调整优化和国企改革到位,尚待时日,至少还需二、三年时间;二是港口对临港货源基地建设自觉性不高,货源自组、自协调供给能力不足;三是陆上货源不足,又缺少吸引海外中转货源政策支持力度;四是港口群体缺少功能互补,     

The potential for British coastal shipping in a multimodal chain

A strategy to revitalize coastal shipping within Great Britain is investigated. An examination of the regulatory environment shows government, at both the EU and British levels, aware of the environmental benefits of coastal shipping compared to road freight transport, if only mildly supportive in tangible terms. The geography of Great Britain and the modern preference for just-in-time deliveries have severely restricted the ability of coastal shipping to compete effectively with road freight transport. The primary objective of the paper is to investigate whether coastal shipping could be integrated into a multimodal door-to-door supply chain, where it is currently hampered by high costs of transhipment, slow transport speeds, and the incongruity of load sizes between land and sea modes. Integration requires the co-operation of all organizations within the multi-modal supply chain. However, coastal shipping companies have been known to be individualistic and mistrusting of alliances. Therefore, a Delphi study is undertaken to investigate the standpoint of leading managers in such companies towards multimodal integration. The results of the Delphi study indicate that managers are in favour of multimodal developments, in particular cooperation between coastal shipping and road haulage. However, there was agreement that the business is highly competitive, and this may prevent the forms of collaboration required for multimodal systems. The secretive nature of the coastal shipping sector could impede joint marketing to promote a mode of transport that is often 'invisible' to shippers. There was little consensus on the relationship that should exist between coastal shipping and ports, a topic worthy of further investigation.     

The potential for British coastal shipping in a multimodal chain

A strategy to revitalize coastal shipping within Great Britain is investigated. An examination of the regulatory environment shows government, at both the EU and British levels, aware of the environmental benefits of coastal shipping compared to road freight transport, if only mildly supportive in tangible terms. The geography of Great Britain and the modern preference for just-in-time deliveries have severely restricted the ability of coastal shipping to compete effectively with road freight transport. The primary objective of the paper is to investigate whether coastal shipping could be integrated into a multimodal door-to-door supply chain, where it is currently hampered by high costs of transhipment, slow transport speeds, and the incongruity of load sizes between land and sea modes. Integration requires the co-operation of all organizations within the multi-modal supply chain. However, coastal shipping companies have been known to be individualistic and mistrusting of alliances. Therefore, a Delphi study is undertaken to investigate the standpoint of leading managers in such companies towards multimodal integration. The results of the Delphi study indicate that managers are in favour of multimodal developments, in particular cooperation between coastal shipping and road haulage. However, there was agreement that the business is highly competitive, and this may prevent the forms of collaboration required for multimodal systems. The secretive nature of the coastal shipping sector could impede joint marketing to promote a mode of transport that is often ‘invisible’ to shippers. There was little consensus on the relationship that should exist between coastal shipping and ports, a topic worthy of further investigation.     

Engaging the paratransit sector in Cape Town on public transport reform: Progress,process and risks

The South African government in 2006 initiated an urban public transport reform programme reliant on the introduction of new bus rapid transit (BRT) systems. Affected paratransit operators can opt to be incorporated in these systems by forming new operating companies, but must withdraw their existing services from proposed routes. Cape Town's first phase of BRT operations came online in 2011, and operator engagement has focussed on this phase. The attitudes within this city's paratransit sector in relation to future phases, and to the broader reform policy, remain largely untested. In view of this sector's past resistance to government-led proposals, and the current phase avoiding areas with the highest concentrations of operators, the current engagement process's outcomes may not be adequate indicators of future prospects.     

British OSV companies in the North Sea, 1964-1997

In the mid 1960s the world OSV industry was dominated by American operators, but with the rise of the North Sea offshore industry, British entrepreneurs were given the chance to contest American dominance. By the mid 1970s British OSV companies had made great progress and, at least in the North Sea context, their principal rivals were now the Norwegians rather than the Americans. British OSV companies continued to prosper until the world oil price collapse of 1986. This blow led to a restructuring of the British OSV industry, which led, by the mid-1990s, to Stirling Shipping being the principal British OSV firm in the North Sea and OIL being the largest non-American OSV company in the world. The 1997 sale of OIL to the Americans was a blow to the British OSV sector, but British enterprise in this field still continues in the North Sea.     

Sustainability and national policy in UK port development

Given the private sector character of the UK port system it might well be thought that, so far as port development is concerned, the market ruled. There are of course permissions to be obtained, including planning consent under the Town and Country Planning Acts; but this process has not so far been considered to interfere with market function. Ports are already well used to the process of obtaining approval, to negotiations with objectors and environmental interests, and to mitigating the effects of development when defining projects and seeking approval.

However, as ports policy is being brought into line with transport policy generally, and in particular with Government policy for sustainable development, ports are being faced with a more challenging regulatory framework. The search for sustainable transport is leading Government towards a broader based approach to the approval of development applications in which market need and commercial viability are simply two of a number of considerations which ports must take into account in designing projects which also meet environmental concerns.

There has been a long standing requirement for developers of major projects to carry out Environmental Impact Assessments. In addition Government policy is set out in a number of publications, applying sustainability and the associated “New Approach to Transport Assessment” (NATA) to the ports sector. In a separate and broader initiative it has also considered a radical reform of the planning system and the establishment of national priorities for infrastructure combined with a simplification of the Public Inquiry process. In the event it has been decided not to establish national priorities in the ports sector, although the aim of simplification of the Inquiry process remains.

The aim of this paper is to explore the emerging theoretical and practical issues arising within the development approval process. These are of most concern in the development of major projects for cargoes which have broad hinterlands, and where there are competing locations for new facilities. The most important example of this is in the deep sea container sector where there is a demand for new capacity and a choice of widely spaced locations in the south east of the UK. Some comment will be made on this sector and on the issues arising at the Public Inquiries for the proposed container port developments at Dibden Bay (Southampton) and the London Gateway at Shellhaven on the north bank of the Thames.     

Do mergers and alliances influence European shipping and port competition?

In Europe, ports are confronted with a closer integration in the maritime and shipping industries. The co-operation agreements can take several forms such as alliances and mergers among shipping lines, conferences, involvement of shipping companies in terminal management, and extending interests in inland transport of shipping companies. In this paper we give a brief overview of these different types of agreement and we examine the consequences of this evolution of the market structures in which ports and shipping companies have to operate. More specifically, attention goes to the competitive position of the port in this new environment. It is clear that the role of the port and the port authorities has to be redefined to guarantee that it remains a fully fledged player in this fast evolving integrated market.     

The competitiveness of short sea shipping in multimodal logistics supply chains: service attributes

In Europe, ports are confronted with a closer integration in the maritime and shipping industries. The co-operation agreements can take several forms such as alliances and mergers among shipping lines, conferences, involvement of shipping companies in terminal management, and extending interests in inland transport of shipping companies. In this paper we give a brief overview of these different types of agreement and we examine the consequences of this evolution of the market structures in which ports and shipping companies have to operate. More specifically, attention goes to the competitive position of the port in this new environment. It is clear that the role of the port and the port authorities has to be redefined to guarantee that it remains a fully fledged player in this fast evolving integrated market.     

Eastern/Western European shipping companies and multimodal transport operations

The purpose of this article is to discuss the current developments in multimodal cargo flows in North European freight transports from Eastern and Western European shipping companies' point of view. Four types of options were identified for shipping companies in multimodal transport operations, namely: (i) the full service operator option, (ii) the feeder operator option in container trades, (iii) the ro-ro operator option, and (iv) the ferry operator option. Option (i) requires a global transport network together with efficient information handling capabilities. This option can be reached by a limited number of mega-carriers. The scope of investment and know-how in this option is such that Eastern European operators are unlikely to achieve this level. In (ii), fleets from (or registered in) the former socialist countries have an advantage as low cost operators, provided that the quality of the operation conforms to principals' requirements. However, the supply side in the intra-European container feeder trades seems to be quite saturated, and new market shares will be very difficult to acquire in the 1990s. In ro-ro shortsea trades the major freight transport operators are well integrated into either freight forwarder driven arrangements (Sweden, Germany), or into major shippers (Finland). As providers of port-to-port transports for road-based cargoes, ferry operators continue to play an important part in international transports. However, the major incentive (and revenue) for passenger/car ferry operations is usually derived from consumers' vacational or travelling needs. Along with the ongoing transition process and a higher level of economic stability that is hopefully achieved in these countries, mergers and acquisitions by Western partners are likely to follow.