Vessel Deployment and De-Hubbing in Maritime Networks: A Case Study on Colombo Port and Its Feeder Market

Abstract

Generally, vessels are deployed as hub-and-spoke networks to achieve high slot utilization and cost efficiency for shipping lines in global maritime container shipping networks. At the Port of Colombo, most transhipment containers originate from and are destined for Indian ports, the export/import container volume of which has been rapidly increasing, and Indian ports have been developed to accommodate vessel enlargement. In such circumstances, the partial or complete abandonment of a hub (Colombo port) in this region is expected, which is known as “de-hubbing.” This study aims to clarify the impact of port developments and an increase in container cargo demand from the source country on maritime network selection from the perspective of shipping lines. We develop a mixed integer linear programming model to describe vessel deployment, including transhipment via the Colombo port and direct shipment in Indian ports. As a result of the analysis, the number of direct services to Indian ports is expected to increase when the cargo demand of Indian ports increases and the port development of Indian ports is conducted. The progress of the de-hubbing phenomenon decreases vessel size at Colombo port because the container demand at Indian ports is mostly satisfied by newly deployed trunk lines to Indian ports. This study suggests that if Colombo port expects to maintain its hub status, it is critical to consider various other incentives to attract and retain mainline carriers in addition to expanding its port infrastructure. Similarly, if India expects to receive direct calls from mainlines, it is important not only to develop their port infrastructure but also to increase their cargo demand.

Unmasking Opportunities and Challenges in the Colombo Port Mega Hub Transformation

“…Quay walls must be heightened, strengthened, and lengthened to accommodate these colossal ships and harbor basins often require expansion, while channels need deepening to facilitate safe navigation (Merk & Busquet, 2015). This juncture of increased shipping volumes and the emergence of mega-size container carriers poses a twofold challenge for the Colombo Port: first, to assess its latent potential to accommodate and thrive in this evolving maritime environment, and second, to identify the obstacles and constraints that may impede its journey towards realizing the Mega Hub Vision (Kawasaki et al, 2022). With their substantial demands and challenges, the modern-day mega carriers underscore the urgency for comprehensive research on the infrastructure and superstructure requirements of seaports and container terminals, examining the Colombo Port's trajectory as a timely and crucial endeavor in the global maritime discourse (MOFP, 2010).…”

“…The port of Colombo is strategically located on the East-West main sea route as a central transshipment hub in South Asia (Kawasaki et al, 2022). However, in recent years, Colombo Port lost its market share in the regional transshipment market because its fundamentals changed and did not adapt (ADB, 2013).…”

Port Structures, Maritime Transport, and Tourism

“…Connectivity and Regional Development: Efficient port and maritime transport systems are key to connect regions, promote international trade, and stimulate regional development. Thus, this segment assesses how ports can foster economic growth, namely by highlighting some success stories from different regions around the globe [12,13].…”