Dynamic Port Planning under Competition: Development of a tool for strategic investment planning

Dynamic Port Planning under Competition: Development of a tool for strategic investment planning

Gerrits, W.A.

Ligteringen, H. (mentor)
Zondag, B. (mentor)
Van de Voorde, E. (mentor)
Verhaeghe, R.J. (mentor)

Civil Engineering and Geosciences

2007-06-27

Since the container revolution in the mid-sixties and the scale increase it caused, seaports face changing technological developments and economic circumstances. Terminal operators and port authorities have to deal with an increasing number of uncertainties. Especially in container transport competition plays a major role. Containers have a relative large mobility and container transportation routes are less bounded to modalities, ports and logistic chains. As a consequence the substitutability of ports is considerable. Port selection within the logistic chain is part of the selection of the logistic chain which is the primary choice. The market power of shipping companies has been enhanced to the extent that they have gained control of logistic chains. The capacity of container carriers is still growing and as long as there is enough freight to transport they tend to call at less and less ports. There are huge challenges for container ports and their terminals to remain competitive and to handle the anticipated growth with an increase of their productivity, a reduction of port congestion (e.g. Maasvlakte II) and improvement of their hinterland accessibility (e.g. the Betuweline). The overall objective of this research is to provide port authorities with a tool to support their strategic investment planning in a competitive market. The tool should provide port authorities with information on the impacts of, structural and non-structural, capacity improvement measures on the future demand for container service. The present thesis contributes to this objective by the development of the Port Competition Model, a supporting planning tool. The port can be considered a node in a transport network with competition, which faces a dynamic situation concerning the timing and sizing of capacity expansions of other ports and changes in the transport network. The challenge is to incorporate the aspects of the full dynamics of port competition over the network in the Port Competition Model by simulation of the competitive strategies of other ports and the sensitivity of decisions on port investment for such strategies. To this end the Port Competition Model needs to represent varying market shares over the years in order to reflect strategies of other ports. When port planning is based on varying market shares of competitive ports it can be defined as "dynamic port planning". The focus of this research is the reaction of a particular port on a change in the transportation network. A scenario for such change is the entry of new routes via a competing port. This leads to decreased demands and benefits for the particular port. Potential reactions of the ports on this change include investment in port expansion and improvement of hinterland connections. The expansion of a port's surface area takes a central place in this research. The density of ports in Northwest Europe is the highest in the world. This implies severe competition. Four of the five biggest European ports are situated within the Hamburg - Le Havre range: Rotterdam, Antwerp, Hamburg and Bremen. Within this range the ports compete mainly on transit containers. The Port Competition Model has been developed for these four ports within the Hamburg - Le Havre range.

port
planning
dynamic
competition
tool

http://resolver.tudelft.nl/uuid:dd80d419-0d55-4867-bb4d-771ed54a91b4

TU Delft, Civil Engineering and Geosciences, Hydraulic Engineering

Student theses

master thesis

(c) 2007 W.A. Gerrits