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Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10 th International Harbour Masters Congress Vancouver, Canada

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Page 1: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

Mega-ships: do the benefits outweigh the costs to the transport chain?

Olaf Merk

1 June 2016

10th International Harbour Masters Congress

Vancouver, Canada

Page 2: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

Big is beautiful?

• Bigger ships

• Bigger costs, peaks, risks

• Bigger shipping lines

• Bigger ports and terminals

• Always bigger?

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Page 3: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

“The Impact of Mega-Ships” Report

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Page 4: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

Bigger ships

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Container ships

Bulkers

Passenger & Cruise

Tankers

Ro/Ro-ships

General cargo

0

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120

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160

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1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Sh

ip s

ize g

ro

wth

(d

wt;

10

0=

ind

ex)

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Bigger container ships

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Cost savings for shipping lines

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,100 $

,150 $

,200 $

,250 $

,300 $

,350 $

,400 $

,450 $

5,000 7,000 9,000 11,000 13,000 15,000 17,000 19,000

US

$/

TE

U

Nominal TEU size

cost at 16 knots

cost at 22 knots

old units at 22 knots, contains first ~15,000 TEU units and hypothetical fast 19,000 TEU ship

modern units at 22 knots

old units at 16 knots, contains first ~15,000 TEU units and hypothetical fast 19,000 TEU ship

modern units at 16 knots

Assumptions: Round trip: 21,000 nm, three weeks tied up for port operations Average cost of main engine fuel: US$ 600/ton

Utilization of nominal capacity: 85%

8,500 TEU vessel built ~ 2003

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Bigger costs for the transport chain

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Bigger peaks

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0

50000

100000

150000

200000

250000

300000

0

1

2

3

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5

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7

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30/7 19/8 8/9 28/9 18/10 7/11 27/11 17/12

GT

Yard

AVG DAYS

GT daily volume of container shipsmoored over 50 000 GTGT daily volume of container shipsmoored <= 50 000 GT

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Pressure on terminals

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Page 16: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

Bigger is not faster

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How much faster is possible?

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How much faster is possible?

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Who is going to pay?

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More flexibility

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0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Container arrivals/departures by road transport per hour of day in 2014

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Bigger risks

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Bigger risks

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Bigger container shipping lines

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Page 25: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

Bigger shipping lines: alliances

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Bigger terminals: alliances of terminals

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Need for bigger ports?

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mu

lati

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North Europe

Carriers

Ports

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Mediterranean

Carriers

Ports

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Bigger ports

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Can the ships be filled?

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Where are we heading?

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Cascade effects

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Big, bigger, biggest: vicious circle?

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Need to cut costs

Bigger ships

Overcapacity

Lower freight rates

Page 33: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

“The Impact of Mega-Ships” Report

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Page 34: Mega-ships: do the benefits outweigh the costs to the ... · Mega-ships: do the benefits outweigh the costs to the transport chain? Olaf Merk 1 June 2016 10th International Harbour

Thank you!

Olaf Merk

[email protected]

www.internationaltransportforum.org

Twitter: @o_merk