The profit maximizing liner shipping problem with flexible frequencies: logistical and environmental considerations

Giovannini, Massimo; Psaraftis, Harilaos N.

doi:10.1007/s10696-018-9308-z

Cited by 26 publications

(13 citation statements)

References 22 publications

(21 reference statements)

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“…This study assumes that the objective of the liner shipping company is to maximize the total profit. Such an assumption is in line with the previously conducted liner shipping studies (Giovannini and Psaraftis, 2019;Dulebenets et al, 2019). The total profit can be calculated as a difference between the total revenue and the total route service cost.…”

Section: Objective Of the Liner Shipping Companysupporting

confidence: 66%

“…Dulebenets (2019) proposed a collaborative agreement between MCT operators and liner shipping companies, where at each port a given liner shipping company could select from multiple TWs and multiple HRs, which had different handling costs. Furthermore, some of the concurrent vessel scheduling studies have considered the impact of liner shipping on the environment, such as emissions of harmful substances (Fagerholt and Psaraftis, 2015;De et al, 2016;Dulebenets, 2018c,d;Giovannini and Psaraftis, 2019;Cheaitou and Cariou, 2019). For example, Fagerholt and Psaraftis (2015) investigated the use of low-sulfur fuel, which is more expensive as compared to the regular fuel, within ECAs.…”

Section: Vessel Schedule Designmentioning

confidence: 99%

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Holistic tactical-level planning in liner shipping: an exact optimization approach

et al. 2020

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Effective liner shipping is important for the global seaborne trade. The volume of cargoes transported by liner shipping has been increasing over the past decades. Liner shipping companies face three levels of decision problems, including strategic, tactical, and operational problems. The tactical-level decisions are commonly made every three to 6 months. These decisions include: (1) port service frequency determination; (2) fleet deployment; (3) sailing speed optimization; and (4) vessel schedule design. Most of the concurrent liner shipping studies have addressed the tactical-level decision problems separately. Even though a few studies have proposed joint planning models that capture multiple decision problems at the same time, none of the conducted studies has integrated all the four tactical-level decision problems. To address this gap in the state-of-the-art, this study presents a holistic optimization model that addresses all the tactical-level liner shipping decision problems, aiming to maximize the total profit obtained from liner shipping services. The key route service cost components, found in the liner shipping literature, are considered in this study, which include: (1) vessel operational cost; (2) vessel chartering cost; (3) port handling cost; (4) port late arrival cost; (5) fuel consumption cost; (6) container inventory costs in sea and at ports of call; and (7) emission costs in sea and at ports of call. An exact optimization approach is adopted for the developed mathematical model. The computational experiments, conducted for a set of Asia-North America liner shipping routes, showcase the efficiency of the proposed approach and offer some important managerial insights.

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Section: Objective Of the Liner Shipping Companysupporting

confidence: 66%

Section: Vessel Schedule Designmentioning

confidence: 99%

Holistic tactical-level planning in liner shipping: an exact optimization approach

et al. 2020

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“…Unlike most studies that assumed weekly or bi-weekly service frequency, Giovannini and Psaraftis (2018) considered variable service frequency from a greater set for the profit maximization problem. The study also incorporated the effect of fluctuations in freight rates, bunker prices, and inventory costs.…”

Section: Description Of Studiesmentioning

confidence: 99%

A Holistic Optimization Model for Integrated Tactical Level Planning in Liner Shipping

Pasha¹

2020

Preprint

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Supply chain management plays an important role in ensuring an efficient merchandise trade. Freight transportation is an integral part of supply chain management. A significant part of freight transportation is covered by maritime transportation, as the largest portion of the global merchandise trade, in terms of volume, is carried out by maritime transportation. Liner shipping, which runs on fixed routes and schedules, plays a colossal role for the global seaborne trade. Liner shipping companies deal with three decision levels, namely strategic level, tactical level, and operational level. The strategic-level decisions are taken for more than six months to several years. The tactical-level decisions are effective for three months to six months. Moreover, the operational level decisions are taken for a couple of weeks to less than three months.This dissertation involves the tactical-level decisions in liner shipping, which include: (1) service frequency determination; (2) fleet deployment; (3) sailing speed optimization; and (4) vessel scheduling. The service frequency determination problem deals with determining the time headway between consecutive vessels along a liner shipping route. The fleet deployment problem assigns vessels from the liner shipping company’s fleet (and sometimes, from other liner shipping companies’ fleets) to liner shipping routes. The sailing speed optimization problem deals with selecting sailing speeds along different voyage legs of a given port rotation. The vessel scheduling problem lists the schedules (e.g., arrival time, handling time, departure time) at different ports.A comprehensive review of the liner shipping literature revealed that the existing literature on the tactical-level decisions focused on these problems individually. Solutions from different solution methodologies for the separate problems may have compatibility problems. Moreover, they are not attractive to the liner shipping companies, who look for integrated solutions. Hence, this research aimed to develop a combined mathematical model that comprises the four tactical-level decisions in liner shipping (i.e., service frequency determination, fleet deployment, sailing speed optimization, and vessel scheduling). This mathematical model is named the Holistic Optimization Model for Tactical-Level Planning in Liner Shipping (HOMTLP).The objective of the HOMTLP mathematical model is to maximize of the total profit from transport of cargo. The major route service cost components, found from the literature, are covered by the model, which include: (I) total late arrival cost; (II) total port handling cost; (III) total fuel consumption cost; (IV) total vessel operational cost; (V) total vessel chartering cost; (VI) total container inventory cost in sea; (VII) total container inventory cost at ports of call; (VIII) total emission cost in sea; and (IX) total emission cost at ports of call. Along with the integration of all four tactical-level decisions, the mathematical model has a number of key advantages. First, the model provides flexibility to both the liner shipping company and the marine container terminal operators, as it offers multiple time windows and handling rates at each port of call. Second, the payload carried by the vessels is considered while estimating fuel consumption. Third, the preference of customers is reflected by modification of the container demand at different sailing speeds. Fourth, container inventory is accounted for at ports of call and in sea. Fifth, emissions of different harmful substances are captured in order to preserve the environment.This dissertation carried out a set of numerical experiments to test the performance of the HOMTLP model, where BARON was used as the solution approach. It was revealed that when there was an increase in the unit fuel cost, the unit emission cost, vessel availability, the unit late arrival cost, and the unit freight rate, the sailing speed was reduced. On the other hand, when there was an increase in the unit inventory cost, the unit operational cost, as well as the unit chartering cost, the sailing speed was increased. Moreover, the total required number of vessels was increased, when there as an increase in the unit fuel cost, the unit emission cost, vessel availability, the unit late arrival cost, and the unit freight rate. On the contrary, the total required number of vessels was decreased, when there was an increase in the unit inventory cost, the unit operational cost as well as the unit chartering cost. It was also revealed that the total profit was increased, when more choices were available for time windows and/or container handling rates. The numerical experiments highlighted several other findings. Most importantly, it was found that the HOMTLP model can provide effective tactical-level decisions. Hence, the mathematical model can assist liner shipping companies to take tactical-level decisions, which are effective and profitable.

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“…Fagerholt et al [16] and Fagerholt and Psaraftis [17] examined route-speed alternatives for ships operating in and out of emissions control areas (ECAs) and Magirou et al [18] developed stochastic optimal control schemes for speed optimization in a dynamic setting. Giovannini and Psaraftis [19] developed a model for a fixed route liner shipping scenario, which, among other things, considers flexible service frequencies, to be selected among a broader set than the standard assumption of one call per week. The impact of the line's decisions on CO 2 emissions was also examined.…”

Section: Other Contexts and Side-effectsmentioning

confidence: 99%

Speed Optimization vs Speed Reduction: the Choice between Speed Limits and a Bunker Levy

Psaraftis

2019

Sustainability

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“Speed optimization and speed reduction” are included in the set of candidate short-term measures under discussion at the International Maritime Organization (IMO), in the quest to reduce greenhouse gas (GHG) emissions from ships. However, there is much confusion on what either speed optimization or speed reduction may mean, and some stakeholders have proposed mandatory speed limits as a measure to achieve GHG emissions reduction. The purpose of this paper is to shed some light into this debate, and specifically examine whether reducing speed by imposing a speed limit is better than doing the same by imposing a bunker levy. To that effect, the two options are compared. The main result of the paper is that the speed limit option exhibits a number of deficiencies as an instrument to reduce GHG emissions, at least vis-à-vis the bunker levy option.

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The profit maximizing liner shipping problem with flexible frequencies: logistical and environmental considerations

Cited by 26 publications

References 22 publications

Holistic tactical-level planning in liner shipping: an exact optimization approach

Holistic tactical-level planning in liner shipping: an exact optimization approach

A Holistic Optimization Model for Integrated Tactical Level Planning in Liner Shipping

Speed Optimization vs Speed Reduction: the Choice between Speed Limits and a Bunker Levy

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