Authors: Dr. Jean-Paul Rodrigue and Dr. Theo Notteboom
Maritime transportation concerns the movement of passengers and freight over water masses, from oceans to rivers.
1. Maritime Geography and Routes
From its modest origins as Egyptian coastal and river sailships around 3,200 BCE, maritime transportation has always been the dominant support of global trade. By 1,200 BCE, Egyptian ships traded as far as Sumatra, representing one of the longest maritime routes of that time. By the 10th century, Chinese merchants frequented the South China Sea and the Indian Ocean, establishing regional trade networks. In the early 15th century, Admiral Zheng He led a large fleet of more than 300 vessels manned by a crew of 28,000 to conduct seven major expeditions, one which reached the East African coast. However, China’s attempt to assert a regional maritime dominance was short-lived. Such expeditions were not permitted to continue mainly because China perceived itself as a continental power with maritime trade of limited interest.
However, for other nations, the projection of maritime power became of strategic interest. European colonial powers, mainly Spain, Portugal, England, the Netherlands, and France, were the first to establish a dependable global maritime trade network from the 16th century. Most maritime shipping activities focused around the Mediterranean, the northern Indian Ocean, Pacific Asia, and the North Atlantic, including the Caribbean. Thus, access to trade commodities remains historically and contemporarily the main driver in the setting of maritime networks.
With the development of the steam engine in the mid 19th century, trade networks expanded considerably as ships were no longer subject to dominant wind patterns. Accordingly and in conjunction with the opening of the Suez Canal, the second half of the 19th century saw an intensification of maritime trade to and across the Pacific. In the 20th century, maritime transport grew exponentially as changes in international trade, and seaborne trade became interrelated. Maritime transportation, like all transportation, is a derived demand that exists to support trade relations. These trade relations are also influenced by the existing maritime shipping capacity and the changes in the composition of maritime shipping services. There is thus a level of reciprocity between trade and maritime shipping capabilities. As of 2008, seaborne trade accounted for 89.6% of global trade in terms of volume and 70.1% in terms of value. Maritime shipping is one of the most globalized industries in terms of ownership and operations.
Maritime transportation, like land and air modes, operates on its own space, which is concomitantly geographical by its physical attributes, strategic by its control, and commercial by its usage. While geographical considerations tend to be constant in time (except for the seasonality of weather patterns), strategic and especially commercial considerations are much more dynamic. The physiography of maritime transportation is composed of two major elements, which are rivers and oceans. Although they are connected, each represents a specific domain of maritime circulation. The notion of maritime transportation rests on the existence of regular itineraries, better known as maritime routes.
Maritime routes. Corridors of a few kilometers in width are trying to avoid the discontinuities of land transport by linking ports, the main elements of the maritime / land interface. Maritime routes are a function of obligatory points of passage, which are strategic places, of physical constraints (coasts, winds, marine currents, depth, reefs, ice), and political borders. As a result, maritime routes draw arcs on the earth’s water surface as intercontinental maritime transportation tries to follow the great circle distance. Maritime routes link maritime ranges representing main commercial areas between and within which maritime shipping services are established.
The most recent technological transformations affecting water transport have focused on modifying water channels (such as dredging port channels to deeper depths). Increasing the size, the automation, and the specialization of vessels (e.g. container ships, tankers, bulk carriers) has also been the focus. This has required the development of massive port terminal facilities to support the technical requirements of maritime transportation. Maritime traffic has been adapting to increasing energy demand (mainly fossil fuels), the movements of raw materials, the location of major grain markets, and not least to the growth of the trade of intermediate and finished goods. Yet, this process is not uniform, and various levels of connectivity to global shipping networks are being observed. The massification of transport into regular flows over long distances is not without consequences when accidents affecting oil tankers can lead to major ecological disasters (e.g. Amoco Cadiz, Exxon Valdez).
Fluvial transportation, even if slow and inflexible, offers a high capacity and a continuous flow. The fluvial / land interface often relies less on transshipment infrastructures and is thus more permissive for the location of dependent activities. Ports are less relevant to fluvial transportation, but fluvial hub centers experience a growing integration with maritime and land transportation, notably with containerization. The degree of integration for fluvial transportation varies from totally isolated distribution systems to well-integrated ones. In regions well supplied by hydrographic networks, fluvial transportation can be a privileged mode of shipment between economic activities. In fact, several industrial regions have emerged along major fluvial axis as this mode was initially an important vector of industrialization. More recently, river-sea navigation is also providing a new dimension to fluvial transportation by establishing a direct interface between fluvial and maritime systems.
Most maritime circulation takes place along coastlines, and three continents have limited fluvial trade; Africa, Australia, and Asia (with the exception of China). There are large fluvial waterway systems in North America, Europe, and China over which significant fluvial circulation takes place. Fluvial-maritime ships can go directly from fluvial to oceanic maritime networks. Despite regular services on selected fluvial arteries, such as the Yangtze, the potential of waterways for passenger transport remains limited to fluvial tourism (river cruises). Most major maritime infrastructures involve maintaining or modifying waterways to establish more direct routes (navigation channels and canals). This strategy is very expensive and undertaken only when necessary. Significant investments have been made in expanding transshipment capacities of ports, which is also very expensive as ports are heavy consumers of space.
Not every region has direct access to the ocean and maritime transport. As opposed to coastal countries, maritime enclaves (landlocked countries) are such countries that have difficulties in undertaking maritime trade since they are not directly part of an oceanic domain of maritime circulation. This requires agreements with neighboring countries to have access to a port facility through a highway, a rail line, or through a river. However, being landlocked does not necessarily imply exclusion from international trade, but substantially higher transport costs which may impair economic development. Further, being landlocked can be a relative concept since a coastal country could be considered as relatively landlocked if its port system was not sufficient to handle its maritime trade or if its importers or exporters were using a port in a third country. For instance, France has significant nautical accessibility, but the primary port handling it containerized traffic is Antwerp in Belgium.
The importance and configuration of maritime routes have changed with economic development and technical improvements. Among those, containerization changed the configuration of freight routes with innovative services. Before containerization, loading or unloading a ship was a costly and time-consuming task, and a cargo ship typically spent more time docked than at sea. While sailing time used to represent around 25% of the annual ship time for standard break-bulk ships, this figure is now around 70% for containerships. With faster and cheaper port operations, inter-range routes have emerged as a dominant configuration of containerized maritime networks.
Inter-range service. Involves a set of sequential port calls from at least two maritime ranges, commonly including a transoceanic service and structured as a continuous loop. They are almost exclusively used for container transportation with the purpose of servicing a market by balancing the number of port calls and the frequency of services.
The main advantage of inter-range services is the ability to call several ports and increase the ship load factor. This sequence of ports tends to be highly flexible in terms of which ports are serviced to maximize the market potential. However, there is the risk of empty trips (particularly backhauls) and longer service times between distant port pairs along the route. The first inter-range route was set in 1962 by Sea-Land between the ports of New York (Newark facilities), Los Angeles, and Oakland by using the Panama Canal. The return trip also included a stop in San Juan (Puerto Rico). The most extensive inter-range services are known as “round-the-world” routes as major maritime ranges of the world are services along a continuous loop. Another recent trend has been the integration and specialization of several routes with feeder ships converging at major maritime intermediate hubs. This is notably the case for Europe (Mediterranean, North Sea, and the Baltic) in light of the negative impacts of deviations from main maritime shipping routes in terms of service length and frequency of port calls.
2. Maritime Traffic
Before the era of intercontinental air transportation, long-distance passenger services were assumed by liner passenger ships, dominantly over the North Atlantic. Long-distance passenger movements are now a marginal leisure function solely serviced by cruise shipping in specific regional markets such as the Caribbean and the Mediterranean. Still, several oceanic ferry services are also in operation over short distances, namely in Europe (English Channel, Baltic Sea, Aegean), Japan, and Southeast Asia (Indonesia and the Philippines).
Maritime transportation is dominantly focused on freight since there is no other effective alternative to the long-distance transportation of large amounts of freight. The systematic growth of maritime freight traffic has been fueled by:
- Absolute advantages. They are linked with the geographical distribution of resources, implying that the places of production are usually different from the places of consumption. Large quantities of cargo, therefore, need to be carried over long distances. The growth in mineral and energy trades, the dominant cargoes carried by maritime shipping, is the outcome of both conventional demands from developed countries as well as new demands from developing economies. For instance, coal is mainly used for energy generation and steel-making, activities that grew substantially in the developing world.
- Comparative advantages. Concerns cargoes that under ideal circumstances would likely not be carried, but because of cost and capabilities differentials, substantial shipping flows are generated. The international division of production and trade liberalization incited a large number of parts and finished goods to be carried over long distances, which has supported growth in container shipping. This has been associated with a change in the balance of maritime trade flows, where developing economies have more extensive involvement. Therefore, such cargoes can be temporary and subject to changes in their origins and destinations.
- Technical improvements. Ships and maritime terminals have become more efficient in terms of their throughput and their ability to handle several types of cargoes (e.g. containers, natural gas, refrigerated goods), enabling to support long-distance trade.
- Economies of scale. The growth in the size of ships permitted maritime transportation to become increasingly cost-effective, a trend which has been strengthened by containerization.
Maritime traffic is commonly measured in deadweight tons, which refers to the amount of cargo that can be loaded on an “empty” ship, without exceeding its operational design limits. This limit is often identified as a loadline, which is the maximal draft of the ship and does not account for the weight of the ship itself but includes fuel and ballast water. Maritime freight is conventionally considered in two main markets:
Bulk cargo. Refers to freight, both dry and liquid, that is not packaged, such as minerals (oil, coal, iron ore, bauxite) and grains. It often requires the use of specialized ships such as oil tankers as well as specialized transshipment and storage facilities. Conventionally, this cargo has a single origin, destination, and client and prone to economies of scale. Services tend to be irregular, except for energy trades, and part of vertically integrated production processes (e.g. oil field to port to refinery). The dynamics of the bulk market are mainly attributed to industrialization and economic development, creating additional demand for resources and energy.
Break-bulk cargo. Refers to general cargo that has been packaged in some way with the use of bags, boxes, drums, and particularly containers. This cargo tends to have numerous origins, destinations, and clients. Before containerization, economies of scale were difficult to achieve with break-bulk cargo as the loading and unloading process was very labor and time-consuming. The dynamics of the breakbulk market are related to manufacturing and consumption.
The composition of maritime traffic has shifted from being dominated by liquid bulk (petroleum) to dry bulk and containers. Technical improvements tend to blur the distinction between bulk and break-bulk cargo, as both can be unitized on pallets and increasingly in containers. For instance, it is possible, and increasingly common, to ship grain and oil, both bulk cargoes, in a container. Consequently, the amount of containerized freight has grown substantially, from 23% of all non-bulk cargo in 1980 to 40% in 1990, to 70% in 2000, and 85% in 2015.
Geographically, maritime traffic has evolved considerably over the last decades especially through growth in Asia-Europe and transpacific trade. By establishing commercial linkages between continents, maritime transport supports considerable traffic. The advantage of maritime transport does not rest on its speed, but on its capacity and on the continuity of its services. Railway and road transportation are simply unable, if it was possible, to support traffic at such a geographical scale and intensity. Heavy industrial activities that use bulk raw materials are generally adjacent to port sites, benefiting from load breaks. The average haul length was about 4,200 miles.
The global maritime shipping industry is serviced by about 100,000 commercial vessels of more than 100 tons falling into four broad categories:
- Passenger vessels historically played an essential role since they were the only mode available for long-distance transportation. In a contemporary setting, passenger vessels can be divided into two categories: passenger ferries, where people are carried across relatively small bodies of water (such as a river or a strait) in a shuttle-type service, and cruise ships, where passengers are taken on vacation trips of various duration, usually over several days. The former tend to be smaller and faster vessels. The latter are generally very large capacity ships having a full range of amenities. In 2018, about 28.5 million passengers were serviced by cruise ships, underlining an industry with much growth potential since it services several seasonal markets where the fleet is redeployed to during the year.
- Bulk carriers are ships designed to carry specific commodities and are differentiated into liquid bulk and dry bulk vessels. They include the largest vessels afloat. The largest tankers, the Ultra Large Crude Carriers (ULCC) are up to 500,000 deadweight tons (dwt), with the more typical size being between 250,000 and 350,000 dwt; the largest dry bulk carriers are around 400,000 dwt, while the more typical size is between 100,000 and 150,000 dwt. The emergence of liquefied natural gas (LNG) technology enabled the maritime trade of natural gas with specialized ships.
- General cargo ships are vessels designed to carry non-bulk cargoes. The traditional ships were less than 10,000 dwt, because of extremely slow loading and off-loading. Since the 1960s, these vessels have been replaced by container ships because they can be loaded more rapidly and efficiently, permitting a better application of the principle of economies of scale. Like any other ship class, larger containerships require larger drafts with the current largest ships requiring a draft of 15.5 meters.
- Roll on-Roll off (RORO) vessels, which are designed to allow cars, trucks, and trains to be loaded directly on board. Originally appearing as ferries, these vessels are used on deep-sea trades and are much larger than the typical ferry. The largest is the car carriers that transport vehicles from assembly plants to the main markets. Their capacity is measured in the amount of parking space they can offer to the vehicles they carry, mostly measured in lane meters.
The distinctions in vessel types are further differentiated by the kind of services on which they are deployed. Bulk ships tend to operate both on a regular schedule between two ports or on a voyage basis to reflect fluctuations in the demand. This demand may be seasonal, as for grain transport, of niche, such as for project cargo (e.g. carrying construction material). General cargo vessels operate on liner services, in which the vessels are employed on a regularly scheduled service between fixed ports of call, or as tramp ships, where the vessels have no schedule and move between ports based on cargo availability.
3. Maritime Shipping
The maritime shipping industry is one of the most globalized and is part of a life cycle that includes building, registration, operations, and the final scrapping of the ship. All these activities are substantially fragmented in their ownership and operations. Maritime shipping is dominated by bulk cargo, which roughly accounted for 69.6% of all the ton-miles shipped in 2005. However, the share of break-bulk cargo is increasing steadily, a trend mainly attributed to containerization. Maritime shipping has traditionally faced two drawbacks in relation to other modes. First, it is slow, with speeds at sea averaging 15 knots for bulk ships (26 km/hr), although container ships are designed to sail at speeds above 20 knots (37 km/hr). Secondly, delays are encountered in ports where loading and unloading take place. The latter may involve several days of handling when break-bulk cargo was concerned. These drawbacks are particularly constraining where goods have to be moved over short distances or where shippers require rapid deliveries.
Maritime shipping has seen several major technical innovations aiming at improving the performance of ships or their access to port facilities, notably in the 20th century. They include:
- Size. The last century has seen growth in the number of ships as well as their average size. Size if a common denominator for ships is it expresses type as well as capacity. Each time the size of a ship is doubled, its capacity is cubed (tripled). Although the minimum size for cost-effective bulk handling is estimated to be around 1,000 deadweight tons, economies of scale have pushed for larger ship sizes to service transportation demand. For ship owners, the rationale for larger ships implies reduced crew, fuel, berthing, insurance, and maintenance costs. The largest tankers (ULCC) are around 500,000 dwt (dominant size between 250,000 and 350,000 dwt), while the largest dry bulk carriers are around 350,000 dwt (dominant size between 100,000 and 150,000 dwt). The only remaining constraints on ship size are the capacity of ports, harbors, and canals to accommodate them.
- Speed. The average speed of ships is about 15 knots (1 knot = 1 marine mile = 1,853 meters), which is 28 km per hour. Under such circumstances, a ship would travel about 575 km per day. More recent ships can travel at speeds between 25 to 30 knots (45 to 55 km per hour), but it is uncommon that a commercial ship will travel faster than 25 knots due to energy requirements. To cope with speed requirements, propulsion and engine technology have improved from sails to steam, to diesel, to gas turbines, and to nuclear (only for military ships; civilian attempts were abandoned in the early 1980s). Since the invention of the helix, propulsion has improved considerably, notably by the usage of double helixes, but peaks were reached by the 1970s. Reaching higher maritime speeds remains a challenge that is excessively costly to overcome. As a result, limited improvements in commercial maritime speeds are foreseen. An emerging commercial practice, particularly in container shipping, concerns “slow steaming” where the operating speed is reduced to about 19-20 knots to reduce energy consumption.
- Specialization of ships. Economies of scales are often linked with specialization since many ships are designed to carry only one type of cargo. Both processes have considerably modified maritime transportation. In time, ships became increasingly specialized to include general cargo ships, tankers, grain carriers, barges, mineral carriers, bulk carriers, Liquefied Natural Gas (LNG) carriers, RO-RO ships (roll-on roll-off; for vehicles) and container ships.
- Ship design. Ship design has significantly improved from wood hulls to wood hulls with steel armatures, to steel hulls (the first were warships) and to steel, aluminum, and composite materials hulls. The hulls of contemporary ships are the result of considerable efforts to minimize energy consumption, construction costs, and improve safety. Depending on its complexity, a ship can take between 4 months (container and crude carriers) and one year to build (cruise ship).
- Automation. Different automation technologies are possible, including self-unloading ships, computer-assisted navigation (crew needs are reduced, and safety is increased), and global positioning systems. The overall outcome of automation has been smaller crews being required to operate larger ships.
4. Maritime Economics
An important feature of the economics of shipping relates to its capital costs, which require financing. Because of their size, ships represent a significant capital outlay. Cruise ships represent the most expensive class of vessels, with an Oasis Class cruise ship costing $1.2 billion. Still, even container ships of the largest class represent an initial capital outlays of $190 million. The annual cost of servicing the purchase of these vessels represents the largest single item of operating expenditures, typically accounting for over half of the annual operating costs.
Container shipping requires the deployment of many vessels to maintain a regular service (14 ships in the case of a typical Far East – Europe service), which is a severe constraint on the entry of new players. On the other hand, older second-hand vessels may be purchased for much smaller amounts, and sometimes the purchase price can be easily covered by a few successful voyages. In some regards, therefore, the shipping industry is quite open and historically has provided opportunities for entrepreneurs to accumulate vast fortunes. Many of the largest fleets are in private hands, owned by individuals or by family groups.
The main advantage of maritime transportation is obviously its economies of scale, making it the cheapest per unit of all transport modes, which fits well for heavy industrial activities. On the other hand, maritime transportation has one of the highest entry costs in the transport sector. Typically, a ship has an economic life between 15 and 20 years and thus represents a significant investment that must be amortized. For instance, a Panamax containership can cost $50,000 per day to operate with most of the expenses related to fuel and port charges. The operation of the maritime transport system requires financing that can come from two sources:
- Public. The public sector is commonly responsible for guidance infrastructures (beacons and charts), public piers, dredging, security, and in several cases of the administration of ports (under the umbrella of port authorities).
- Private. The private sector is mostly concerned about specific facilities such as piers, transshipment infrastructures, and ships, which are commonly owned by private maritime companies.
In the past, governments have intervened, often massively, in the maritime sector to fulfill different goals such as economic development, national defense, prestige, the balance of payments, and the protection of the domestic industry. To reach those goals, governments relied on methods such as regulations, subsidies, national fleets, preference of cargo, and ports of entry. Cabotage regulations have been one of the privileged measures to protect the domestic maritime transportation industry.
Cabotage. Transport between two terminals located in the same country irrespective of the country in which the mode providing the service is registered. Cabotage is often subject to restrictions and regulations. Under such circumstances, each nation reserves for its national carriers the right to move domestic freight or passenger traffic.
Many cabotage laws were implemented, such as the Passenger Services Act of 1886, which placed cabotage restrictions on seaborne passenger travel in the United States. Further, the Merchant Marine (Jones) Act of 1920 implemented cabotage regulations for freight. The emergence of short sea shipping has challenged this setting in recent years. Defining short sea shipping is complex as it can involve different vessels (container feeder vessels, ferries, fast ships, etc..), tramp or liner operations, a variety of cargo handling techniques (horizontal, vertical or a mixture of both) and different types of ports of loading or discharge. In an intermodal freight context, two major types of short sea shipping can be distinguished:
- Feeder services from transshipment hubs to feeder ports and vice versa. These services can be arranged on a direct hub port to feeder port base or can follow a line bundling set-up with several feeder ports calls per vessel rotation. They tend to use regular containerships, but of smaller size (often aptly named feeder ships).
- Cabotage services between ports of the same economic region, as within Europe or North America.
5. Shipping Services and Networks
The shipping industry has a very international character, particularly in terms of ownership and flagging. The ownership of ships is extensive. While a vessel may be owned by a Greek family or a Japanese corporation, it may be flagged under another nationality. There are two types of registers, national registers, and open registers, which are often labeled as “flags of convenience”. Using flags of convenience allows ship owners to obtain lower registration fees, lower operating costs, and fewer restrictions. The maritime industry is now more deregulated than before because of technical changes, mainly containerization and open registry ships operating under fiscal shelters. As of 2017, about 70% of the global tonnage was registered under a flag of convenience, with Panama and Liberia being the most prevalent. The maritime shipping industry offers two major types of services:
- Charter services (also known as Tramp). In this form of service, a maritime company rents a ship for a specific purpose, commonly between a particular port of origin and destination. This type of shipping service is notably used in the case of bulk cargo, such as petroleum, iron ore, grain, or coal, often requiring specialized cargo ships that become the load unit (the entire contents of the ship are usually traded).
- Liner shipping services. Involves a regularly scheduled shipping service, often calling several ports along an inter-range route. The emergence of post-Panamax containerships has favored the setting of inter-range services since the maritime landbridge of Panama is no longer accessible to this new class of ships. To ensure schedule reliability, which rarely exceeds 50%, frequency, and a specific level of service (in terms of port calls), many ships can be allocated to a single route, which can take different shapes. For instance, to ensure a weekly port call, eight vessels must be allocated for an inter-range service between Europe and Pacific Asia and about five vessels for trans-Atlantic service. These maritime shipping services are available to any freight importer or exporter, implying that the cargo being carried on any given ship belongs to different interests. A growing share of liner services is containerized.
An important historic feature of oceanic liner transport is the operation of “conferences”. These are formal agreements between companies engaged on particular trading routes. They fix the rates charged by the individual lines, operating for example between Northern Europe and the East Coast of North America, or eastbound between Northern Asia and the West Coast of North America. Over the years in excess of 100 such conference arrangements have been established. While they may be seen as anti-competitive, the conference system has always escaped prosecution from national anti-trust agencies. This is because they are seen as a mechanism to stabilize rates in an industry that is inherently unstable, with significant variations in the supply of ship capacity and market demand. By fixing rates, exporters are given protection from swings in prices and are guaranteed a regular level of service provision. Firms compete on the basis of service provision rather than price.
A new form of inter-firm organization has emerged in the container shipping industry since the mid-1990s. Because of the costs of providing ship capacity to more and more markets are escalating beyond the means of many carriers, many of the largest shipping lines have come together by forming strategic alliances with former competitors. They offer joint services by pooling vessels on the main commercial routes. In this way, they are each able to commit fewer ships to a particular service route and deploy the extra ships on other routes that are maintained outside the alliance. The alliance services are marketed separately, but operationally involve close cooperation in ports of call selection and in establishing schedules. The alliance structure has led to significant developments in route alignments and the economies of scale of container shipping. The consequences have been a concentration of ownership, particularly in container shipping.
The 20 largest carriers controlled 26% of the world slot capacity in 1980, 42% in 1992, 58% in 2003, 81% in 2013 and 90% in 2019. The level of concentration is causing concerns among various national regulatory bodies that see such developments as potentially unfair competitive practices. For instance, in 2013, a large alliance dubbed P3 was being planned between the world’s three largest carriers, Maersk, MSC, and CMA CGM, to help mitigate overcapacity along several major trade routes, particularly between Asia and Europe. However, in 2014 the Chinese government rejected the alliance with the rationale that it was creating an undue level of concentration and the possibility of unfair competition with its carriers. Therefore, Maersk and MSC decided to form a smaller alliance called 2M that began operations in 2015. Further CMA CGM, China Shipping Container Lines, and United Arab Shipping Company (UASC) formed their alliance called Ocean Three, which became the Ocean Alliance in 2017 when COSCO joined. As of 2019, three major alliances (2M, Ocean Alliance, and The Alliance) controlled 80% of the total container shipping capacity.
Carriers have the responsibility to establish and maintain profitable routes in a competitive environment. This involves three major decisions about how such a maritime network takes shape:
- Frequency of service. Frequency is linked with more timely services since the same port will be called more often. A weekly call is considered to be the minimum level of service, but since a growing share of production is time-dependent, there is pressure from customers to have a higher frequency of service. A trade-off between the frequency and the capacity of service is commonly observed. This trade-off is often mitigated on routes that service significant markets since larger ships can be used with the benefits of economies of scale.
- Fleet and vessel size. Due to the basic maritime economics, large ships, such as post-Panamax containerships, offer significant advantages over long distances. Shipping lines will obviously try to use this advantage over their long-distance routes, keeping smaller ships for feeder services. In addition, a large enough number of vessels must be allocated to ensure a good frequency of service. To keep their operations consistent, shippers also try to have ships a similar size along their long-distance inter-range routes. This is not an easy undertaking since economies of scale force the introduction of ever-larger ships, which cannot be added all at once due to extensive financial requirements and the capacity of shipbuilders to provide them. So, each time a bigger ship is introduced on a regular route, the distribution system must adapt to this change in capacity.
- Number of port calls. A route that involves fewer port calls is likely to have lower average transit times in addition to requiring a smaller number of ships. Conversely, too few port calls could involve difficulties for the cargo to reach inland destinations remote from the serviced ports. This implies additional delays and potentially the loss of customers. An appropriate selection of port calls along a maritime facade will help ensure access to a vast commercial hinterland.
Since many container shipping services have an inter-range structure, cabotage imposes some restrictions on these services.
The global maritime transportation system has substantially evolved to form networks within networks, connecting systems of circulation and enabling global trade. Without maritime shipping, globalization could not have taken place to such an extent.
- 6.3 – Port Terminals
- Interoceanic Passages (PEMP external link)
- Maritime Shipping and International Trade (PEMP external link)
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