A Financial Times article reported Maersk’s Triple E Class (18,000 TEU) to be 26 percent more cost efficient than the current E class (15,000 TEU). – Wright, R (2011), Financial Times. ‘Big Ships: Container lines reach for scale’. Recent research into supply chain costs indicates that this is not obvious for the entire supply chain – Streng, M. (2012). Slow steaming: an economic assessment of lowering sailing speeds on a supply chain level’, Master Thesis Urban, Port and Transport Economics, Erasmus University Rotterdam.
The capital cost per TEU moved has increased even considering the increase in slot size of newer larger vessels. Due to the increase in transportation duration, the capital costs and insurance of goods transported have gone up. Further cost increase could be accounted for in the increase in time to market. Fast moving goods (such as consumer electronics) that need longer to get from the world’s production centres to the markets is also a cost. Shipping lines are demanding ever shorter port stays in order to make the economies of scale work. The bigger the ship, the greater the cost of hours lost in port, and an increased port stay is a diseconomy of scale. Port Technology have published the following article which should be useful for shippers, freight forwarders, port planners in better understanding the economics of international shipping and logistics – Mega ships: positive asset or terminals’ worst nightmare?.
How are you. Many thanks for keeping me posted. I enjoy reading these bulletins…..quite interesting.
Hi Jacky, thanks for the punt.. much appreciated. Mike