Analysis of the competitive position of short sea shipping: Development of policy measures

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A

NALYSIS OF THE COMPETITIVE .

POSITION OF SHORT SEA SHIPPING

QfA

195 DEVELOPMENT OF POLICY MEASURES

Prof. dr. C. Peeters

Prof. dr.

A. Verbeke

Drs. E. Declercq, M.Sc.

Prof. dr. ir. N. Wijnolst

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t2-ANALYSIS OF THE COMPE1TIIVE

POSITION OF SHORT SEA SHIPPING:

, \ \

DEVELOPMENT OF POLICY MEASURES

Prof. dr C. Peeters

Prof. dr. A. Verbeke

Drs. E. Declercq, M.Sc.

Prof. dr ir N. Wijnolst

Bibliotheek TU Delft

11111111111

C 2115111

DELFT UNIVERSITY PRESS

1995

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DELFf MARINE TECHNOLOGY SERIES

1. ANALYSIS OF THE CONTAINERSillP CHARTER MARKET 1983-1992

2. INNOV A TION IN FOREST PRODUCTS SillPPING

3. INNOVATION IN SHORTSEA SHIPPING: SELF-LOADING AND UNLOADING

UNITLOAD SHIPSYSTEMS

4. NEDERLANDSE MARITIEME SEKTOR: ECONOMISCHE STRUCTUUR EN

BETEKENIS

5. INNOVATION IN CHEMICAL<S SillPPING: PORT AND SLOPS MANAGEMENT

6. MULTIMODAL SHORTSEA TRANSPORT: COASTAL SUPERIllGHW A Y

7. DE TOEKOMST VAN DE NEDERLANDSE ZEEVAARTSECTOR:

ECONOMISCHE IMP ACT STUDIE (EIS) EN BELEIDSANALYSE

8. INNOVATIE IN DE CONTAINERBINNENVAART: GEAUTOMATISEERD

OVERSLAGSYSTEEM

9. ANALYSIS OF THE PANAMAX BULK CARRIER CHARTER MARKET 1989

-1994: IN RELATION TO THE DESIGN CHARACTERISTICS

10. ANALYSIS OF THE COMPETITIVE POSITION OF SHORT SEA SillPPING:

DEVELOPMENT OF POLICY MEASURES

Prof. Dr. C. Peeters is professor of Public Finance, International Finance, Maritime

Economics and Transport Economics at the Faculty of Applied Economics of the

University of Antwerp (RUCA), where he is Project-coordinator of the Department of

Transport Economics.

Prof. Dr. A. Vemeke is associated with the University of Brussels (VUB) - Solvay Busi-ness School and the University of Antwerp (RUCA) - Faculty of Applies Economics. He is also visiting professor of International Finance and International Business at the

University of Toronto.

Drs. E. Declen:q, M.Se. is Project Director of the management consuIting agency Policy

Research Corporation N.V., Antwerp.

Prof. Dr. Ir; N. Wijnolst is professor of Shipping, Ship-innovation and Shipping

Manage-ment at the Faculty of Mechanical Engineering and Marine Technology of the Delft

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ANALYSIS

OF THE COMPE'ITIIVE

POSITION OF SHORT SEA SHIPPING:

DEVELOPMENT OF POLICY MEASURES

Prof. dr C. Peeters

Prof. dr. A. Verbeke

Drs. E. Declercq, M.Sc.

Prof. dr ir N. Wijnolst

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CIP-DATA KONINKLIJKE BIBLIOTHEEK, THE HAGUE

C. Peeters,

A

Verbeke, E. Declercq, N. Wijnolst

Analysis ofthe Competitive Position of Short Sea Shipping/Peeters, C.; Verbeke, A; Declercq, E.; Wijnolst, N.

Delft: Delft University Press. -ill. -Lit. ISBN 90-407-1105-4

NUGI 834

Keywords: Short sea shipping, Policy measures

No part ofthematerial protected by tbis copyright may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording or any

information storage and retrieval system, without permission ofthe publisher: Delft University Press, Stevinweg 1,2628 CN Delft, The Netherlands.

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Foreword by Prof. Dr. Wim A. G. Blonk

Foreword

Prof. Dr. Wim A. G. Blonk, Director, Maritime Transport and Ports

Directorate General for Transport (DG VII), European Commission

This report is part of a large-scale study, supported by the European Commission, which examined the competitive position of short sea shipping in Europe. A set of important trade corridors in the European Union and some adjoining areas were selected for analysis. The objective ofthe study was to identify for each ofthe corridors the types and amounts of goods which could be transferred from land modes of transport to short sea shipping. The study also aimed to identify and examine the main obstac1es preventing such a transfer. It recommends a set of policy measures which must be taken in order to level the playing field so that short sea shipping can play its role fully, in fair competition with other transport modes.

The study suggests that European transport policy should concentrate inter alia on the following issues:

the creation of more reliable short sea shipping-traffic data;

the coordination of private and public efforts to improve the multi-modal integration of short sea shipping. These efforts should focus on infra- and superstructure in mainports, regional ports and inland ports and the stimulation of unitized cargo (increased containerization and innovative vessel designs). Electronic Data Interchange (EDI) win undoubtedly be instrumental for the multi-modal integration and consequently, important efforts should be made to create a European EDI network;

the development of Port Pairs to develop new short sea shipping routes. These ports could be located either near the sea or inland (fluvio-maritime transport and 'water-based' multi-modal terminals);

the harmonization of regulations regarding flag requirements, safety regulations, the status of vessel registration, liability rules etc.;

the intemalization ofthe extemal costs of transport.

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Foreword hy Prof. Dr. Wim A. G. Blonk

In my view, the set of policy recommendations proposed in Chapter IV of this report constitute an interesting starting point to improve in a substantiaI manner the competitive position of short sea shipping in European transport.

The Commission services noted with particular interest the suggestion made by the authors of the study concerning the fact that a Master Plan should be developed to be implemented by an new body, the 'European SSS - Promotion Service'. This innovatory idea is worthwhile to be explored further and could be exarnined in cooperation with the Member States and the maritime industries.

The study is not only a very interesting first step towards establishing a comprehensive knowledge base on short sea shipping at present, but also a sound basis for the Commis sion to develop its policy guidelines on this subject. The results of the case studies anaIysis show that there are growth opportunities for short sea shipping in a number of trade links. The cargo transfer potentiaI is indeed sufficient to justify action by policy-makers and the private sector for the further promotion of short sea transport as a viable alternative to congested land modes.

However, for this to happen short sea transport should improve the efficiency of its operations

and its integration into multi-modaI transport chains. This implies that the effective

implementation of the policy measures recommended win contribute strongly to the Union's objectives of sustainable mobility in transport as wen as economie and social cohesion in the Union.

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The Competitive Position of SSS - Introduction -i

Introduction

This studi was commissioned by the Directorate-General for Transport (DGVII), Commission of the European Communities and the Department of the Environment and Infrastructure, Ministry ofthe Flemish Community, Flanders. A co-financing arrangement between these two parties made it possible for Policy Research to undertake this study.

Policy Research started its research activities in the Fall of 1992. Numerous parties involved in short sea shipping (SSS), especially SSS-operators and the managers of both large and small ports throughout the E.U. actively cooperated in the development ofthe various chapters.

The study also benefitted from in-depth policy discussions, which took place at the First European Roundtable Conference on SSS in Delft (November 26nd-27nd 1992), which was organized by Prof. Dr. ir. N. Wijnolst and Prof. Dr. C. Peeters.

In the past year, several experts in the field have referred to the study of Policy Research using the term 'corridor study', because the study starts from the assumption that the SSS- market can be divided into a number of geographical corridors.

The study analyzes the present SSS situation, both in terms of cargo transported and fleetsizes. The SSS-market shares constitute an important input for the assessment ofthe growth potential ofthe SSS-mode. The study also evaluates under which conditions the present market shares can be increased, and how technological innovations could generate shifts from, e.g. the road mode to SSS. The main goal ofthe study is the development ofpolicy measures to improve the role of SSS in intra-European transportation.

The authors would like to thank all the staffmembers ofPolicy Research Corporation N. V. for their highly appreciated cooperation and in particular Mrs. Ir. G. Van Vaerenbergh, Research Associate, and Mr. T. Spiessens, Administrative Associate.

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The Competitive Position of SSS - Introduction -ii

The study consists of 4 parts and an Executive Summary :

Executive Summary

I. Identification and Analysis of Existing Intra-European Traffic, for each Relevant

Category of Goods and Transport Corridor

Il. Analysis of the Competitive Position of Short Sea Shipping

A Methodology and Empirical Applications

lIl. Modal Shifts through Technological Innovation

IV. SSS - Policy Recommendations to the E.U.

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The Competitive Position of SSS -Executive Summary -jjj

Executive Summary

This study on the potentialof Short Sea Shipping (SSS) in Europe, with a focus on four corridors, consists of four parts. In the first part (Chapter I) the existing intra-European SSS-traffic is identified and analyzed for each relevant category of goods and transport corridor. In the second part (Chapter 11), a new methodology is proposed for the strategie analysis of the competitive position ofSSS vis-à-vis transport altematives. This methodology is applied to ten case studies with substantial policy relevanee within the corridors under consideration. The third part (Chapter 111) provides an analysis ofthe potential offour 'innovative' types ofSSS-vessels, namely fast cargo ships, sea-river ships, se1funloading bulk carriers and selfunloading and -loading unitload ships. Finally, in the fourth part (Chapter IV), ten major policy recommendations are formulated to guide EU-policies in the area ofSSS.

Chapter I inc1udes a brief 'state ofthe art' regarding research relevant to SSS. The purpose ofthis overview is to introduce the reader to the complexity ofthe challenges faced by SSS in a variety ofmanagerial and policy areas.

The main contribution of this chapter is the cargo flow analysis for four corridors, namely:

Benelux/Germany Benelux/Germany Benelux/Germany UKlIreland

UKlIreland;

Nordie Countries/Baltic Area; Black Sea Area;

ltaly /Greece.

The general cargo flow analysis leads to the conc1usion that SSS.is weil established in the various corridors. However, a substantial part of the SSS-market share results from compelling geographical circumstances (as is the case with traffic flows between Benelux/Germany and UKJIreland) or 'mechanical' economie reasons (as is the case with maritime transport of low value, bulk commodities which benefit from scale economies).

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The Competitive Position of SSS - Executive Summary -iv

A more detailed cargo flow analysis shows that road transportation and SSS are largely /

specialized in the same commodity groups. On the one hand, this suggests that it will be very difficult to substantially improve the competitive position of SSS without major changes in the environmental characteristics faced by SSS or radical improvements of its intemal strengths. On the other hand, this similar pattem of specialisation may lead to opportunities in terms of improved links between the modes through the creation of a multimodal transport chain.

Chapter I also contains a description ofthe EU-SSS-fleet and an assessment ofthe potentialof SSS according to port authorities. A questionnaire was sent to 550 ports and led to a response rate of more than 20%. The port authorities were asked to assess SSS in terms of environmental elements such as overall accessibility (e.g. hinterland connections), port operations (e.g. loading and discharging facilities, innovations in transboarding and/or docking facilities) and the financial and political environment, and in terms of intemal strengths (e.g. SSS-pricing,

marketing ability). Ports in the UKlIreland have a rather negative view on the overall accessibility oftheir hinterland for SSS, as compared to ports from the other areas. The quality of port operations is viewed as very satisfactory in the various areas under consideration. This suggests that in general no fundamental changes need to occur as regards port infra- and superstructure. However, it is suggested in subsequent chapters that this conclusion does not hold for ports in the Baltic area or for inland multirnodal terminals, where major efforts are still required as regards the construction of adequate infrastructure and superstructure. Nevertheless, the absolute volume of these investments for SSS should be considered as relatively modest, as compared to the funds required for equivalent expansion investments for the road mode.

The assessment of the financial and political environment led to widely diverging responses. Some ports indicated the abs~nce of funding or insufficient funding of port infra- and superstructure by government agencies. Other ports, especially in the UKlIreland and the Nordic countries complained about distortions of competition resulting from public subsidies in other countries. Overall, SSS was perceived as a relatively competitive transport mode, but it was clearly more strongly supported in the Nordie countries.

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The Competitive Position of SSS - Executive Summary -v

The main conclusion of Chapter I is that the promotion of SSS is a multi-dimensional issue, whereby sufficient attention should be devoted to a myriad of policy areas, including elements such as port accessibility, port operations, marketing strategies, technological innovations, regulation etc ..

Chapter 11 provides an analysis of the competitive position of SSS. It includes aspecific methodology to analyze case studies in SSS. The conceptual framework is based on the idea that the competitiveness of SSS depends upon a variety of critical extemal (environmental) factors and intemal factors. Within each of these two types of factors, five main categories are distinguished: market factors, competitive factors, financial factors, technical factors and socio-political factors. Each of these five categories is then again subdivided into a nurnber of sub-categories. The methodology suggests that each case study should take the form of an 'attractiveness-strength' analysis, consisting of 8 steps:

Step I: Step 2: Step 3: Step 4: Step 5: Step 6: Step 7: Step 8:

Definition of critical intemal and extemal factors; Assessment of critical extemal factors;

Assessment of critical intemal factors;

Positioning of SSS in an attractiveness-strength matrix; Forecasting of trends for selected critical extemal factors;

Requirements for improving the position of selected critical intemal factors;

Potential (desired) future positioning of SSS in the attractiveness-strength matrix;

F ormulation of policy recornmendations to achieve the potential (desired) future position of SSS.

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The Competitive Position of SSS - Executive Summary -vi

This methodology was applied to ten case studies deemed relevant in terms of covering major routes, within the four corridors under consideration:

Case study

1:

Case study 2: Case study 3: Case study 4: Case study 5: Case study 6: Case study 7: Case study 8: Case study 9: Case study 10:

Unitised trade between the Netherlands/GermanylDenmark and the North ofthe UK;

Trade between the Republic ofireland and Belgium/the Netherlands; Trade between the Republic ofireland and England/Wales;

Trade between the UK and Greece; Trade between the UK and Italy;

Trade between the Netherlands and Greece; Mid-Netherlands - Helsinki region;

Mid-Netherlands - Warszawa region (via Szcecin); Mid-Netherlands - Odessa region;

The potentialof SSS in the Baltic region.

Several conc1usions arise from these case studies, among which the three following"ones:

1. in each of the case studies, SSS is confronted-with an idiosyncratic mix of extemal opportunities/threats and intemal strengths/weaknesses. This obviously explains that hundreds of policy suggestions have been formulated in the recent past by numerous extemal experts, policy makers, research organizations or stakeholders. Unfortunately, many of these policy suggestions are not valid across routes. Hence, the main challenge in this context is to formulate a limited number of c1ear, unambiguous policy recommendations which are valid across the different routes and corridors, see Chapter IV. It should be mentioned, however, that specific policy recommendations for various routes and corridors can be found in Chapters II and lIl;

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The Competitive Position of SSS - Executive Summary -vii

2. every use of SSS on a specific route is not necessarily compatible with the 'highe st use ofSSS'-option. In several cases, it was observed that the main policy choice was not one between road and SSS, but between, e.g. on the one hand a maximum use of SSS and on the other hand a lower use of SSS combined with, e.g. a land bridge. In a number of cases, such as case study 5, the 'highest use of SSS'-option needed to be assessed vis-à-vis several other complex alternatives, each of which included at least some use of SSS. Here, the main policy conclusion is that policy makers should be very careful as regards the stimulation of SSS, as some types of SSS may actually benefit the road mode more than the 'highest use of SSS'-option on specific routes;

3. in most cases, SSS appears to be either a weil established mode or a very weak mode. In neither case it should be assumed that the competitive position of SSS could be substantially affected by simpie, direct, public policy measures. In fact, in both types of cases it appears that only fundamental changes in the technological characteristics of SSS-vessels, which would lead to substantial improvements in, e.g. time, frequency and reliability characteristics, could drastically change the competitiveness ofthis mode.

Given this last conclusion of Chapter 11, the potential contribution of four types of 'innovative' vessel designs is analyzed in Chapter lIl. It appears that each of these four types: fast cargo ships, sea-river ships, selfunloading bulk carriers and selfunloading and -loading unitload ships could have a major impact on traffic shifts within the corridors under consideration. The main . challenge for public policy makers in this context is to improve the diffusion of these 'innovative' techniques and their adoption on routes where they can contribute to the 'highest use of SSS'-option as compared to alternative transport options. From this perspective, they could perform the same role as, e.g. very fast trains in the rail sector.

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The Competitive Position of SSS - Executive Summary -viii

Finally, Chapter IV includes ten majorpolicy recommendations to the EU, which can be viewed as generalized measures withthe joint potential to drastically improve the competitiveness of SSS in Europe.

1. Policy recommendation 1: Creation of reliable market data on European SSS;

2. Policy recommendation 2: Creation of 'Port-pairs' as 'SSS-traffic development champions';

3. Policy recommendation 3: Creation of homogeneous EDI-standards through an EDI-development package for ports and multimodal operators; 4.

5.

6. 7. 8. 9. Policy recommendation 4: Policy recommendation 5: Policy recommendation 6: Policy recommendation 7: Policy recommendation 8: Policy recommendation 9:

Stimulation of diffusion of'entry barrier eliminating' SSS vessel designs;

Stimulation of newbuilding and rebuilding of SSS-vessels; Stimulation of multimodal inland port terminal expansion; Stimulation of port developments in Cohesion Fund countries and Eastem Europe;

Intemalization of extemal costs created by the various transport modes;

Creation of the 'European SSS - Promotion Service' (ESPS);

10. Policy recommendation 10: Formal intra EU coordination of SSS-support measures.

It is the view of the authors of this study, that only a simultaneous attention to the ten policy areas mentioned above will fundamentally improve the competitive position of SSS in the EU vis-à-vis alternative transport options. This may require the use of substantial resources both in physical and tinancial terms, but this study will hopefully have demonstrated convincingly that a long, non-integrated shopping list of vague policy measures to be implemented in a disconnected fashion would not substantially contribute to an improvement ofthe competitive position of SSS across routes and corridors.

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The Competitive Position of SSS - Executive Summary - ix

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The Competitive Position o[ SSS - Contents - xi

Table ofContents

Foreword by Prof Dr. Wim A. G. Blonk, Director Maritime Transport and Ports

Directorate-General for Transport (DG VII), European Commission

Introduction ... .

Executive Summary ... 111

Table ofContents ... ... xi

List ofTables ... ... XIX

List of Figures ... xxv

CHAPTERI IDENTIFICATION AND ANALYSIS OF EXISTING

INTRA-EUROPEAN TRAFFIC, FOR EACH RELEVANT CATEGORY

OF GOODS AND TRANSPORT CORRIDOR

l.I. A State of the Art of the Transport Research Relevant to Short Sea Shipping ... I. -1

1.1.1. The Need for Change in the Transport Environment. . . I. -1 1.1.2. An Overview of the Research Relevant to Short Sea Shipping . . . I. -4 1.l.3. Short Sea Shipping Cargo Flow Analysis ... I. -7

1.lA. Modal Shifts ... ... I. -8

1.1.5. Short Sea Shipping Fleet Analysis ... I. -9 1.1.6. Short Sea Shipping and Intermodalism ... I. -10 1.1.7. Information Technology ... ... I. -12

1.2. Definition. . . . I. -15

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The Competitive Position ol SSS -Contents -xii

1.3. Structure of Analysis ... I. -17

1.4. Short Sea Shipping Cargo Flow Analysis . ...... I. -19 1.4.1. BeneluxJGermany - UKlIreland Cargo Flows .. ... I. -22 1.4.2. Benelux/Germany -Nordie CountrieslPoland Cargo Flows ... I. -24 1.4.3. Bene1uxJGermany - Black Sea Area Cargo Flows ... I. -26 1.4.4. Conc1usion ... I. -28

l.S. Short Sea Shipping Traffic ofCommodities ... ... I. -29 1.5.1. Method of Analysis ... ... I. -29 1.5.2. General Eva:luation ... ... I. -29 1.5.3. Shifts of Cargo from Road Transport to SSS ... I. -35 1.5.4. Benelux/Germany and UKlIreland Corridor ... ... I. -35 1.5.5. Bene1uxJGermany to Nordie CountrieslPoland Corridor ... . I. -37 1.5.6. Bene1uxlGermany to Black Sea Area Corridör ... I. -37 1.5.7. Transfer of Relevant Commodities ... ... I. -39

1.6. Short Sea Fleet Analysis. . ... I. -43 1.6.1. The Importanee of the Short Sea Fleet in the Cargo Carrying Fleet .... I. -44 1.6.2. Distribution of Shiptypes in the Short Sea and Deep Sea Fleet ... I. -48

1.7. Survey of Port Authorities' Assessment of Short Sea Shipping Potential in Corridor Areas. . . . I. -51 1.7.1. Analysis ofthe FOUT Factor Categories ... ... I. -57 1.7.2. SSS-initiatives in Individual Ports ... I. -59 1.7.3. Conc1usion ... ... I. -61

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CHAPTERJI

The Competitwe Position of SSS - Contents -xiii

ANALYSIS OF THE COMPETITIVE POSITION OF SHORT SEA SCHIPPING.A METHODOLOGY AND EMPIRICALAPPLICATIONS

2.1. Introduction ...... II. - 1

2.2. Methodology Jor Case Study Analysis . . . .. 11. - 3

2.3. Case Study

1:

Unitised Trade between the Netherlands/Germany/Denmark

and the North oJ the UK . . . .. 11. -13 2.3.1. Introduction . . . .. II. -13

2.3.2. Case Study Analysis ... II. -13

2.4. Case Study 2: Trade between the Republic oJ lreland and Belgium/the

Netherlands ... II. -39 2.4.1. Introduction . . . .. 11. - 39

2.4.2. Case Study Analysis ... 11. -39

2.5. Case Study 3: Trade between the Republic oJlreland and England & Wales . II. -57

2.5.1. Introduction ... II. -57

2.5.2. Case Study Analysis ... 11. - 57

2.6. Case Study 4: Trade between the UK and Greece . . . .. 11. -69 2.6.1. Introduction . . . .. 11. -69

2.7. Case Study 5: Trade between the UK and ltaly ... 11. -85 2.7.1. Introduction . . . .. 11. - 85

2.8. Case Study 6: Trade between the Netherlands and Greece . . . .. II. -103 2.8.1. Introduction . . . .. 11. - 103

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The Competitive Position o[ SSS -Contents - xiv

2.9. Case Study 7: Mid-Netherlands - Helsinki Region ... 11. -113 2.9.1. Introduction ... Ir. - 113

2.9.2. Case Study Analysis Mid-Netherlands -Helsinki Region .. ... Il. -113

2.10. Case Study 8: Mid-Netherlands - Warszawa Region (via Szczecin) .... Il. -125 2.10.1. Introduction . . . .. 11. - 125

2.10.2. Case Study Analysis Mid-Netherlands - Warszawa Region (via

Szczecin) ... ... Il. - 145

2.11. Case Study 9: Mid-Netherlands - Odessa Region ... ... .... Il. -135 2.11.1. Introduction . . . .. 11. - 135

2.11.2. Case Study Analysis Mid-Netherlands -Odessa Region ... Il. -135

2.11.3. General Conclusions of Case Study 9 (also valid for case study 7

and 8) ... ... 11. - 145

2.12. Case Study IOa: The Potential ofSSS in the Baltic Region: Trade between the Netherlands and St. Petersburg Region . . . .. Il. - 149 2.12.1. Introduction ... ... 11. - 149

2.12.2. Case Study Analysis ... Il. -149

2.13. Case Study lOb: The Potential ofSSS in the Baltic Region: Trade between the Netherlands and the Estonian Republic ... Ir. - 159 2.13.1. Introduction ... ... Il. - 159

2.13.2. Case Study Analysis ... Il. - 159

2.14. Case Study lOc: The Potentialof SSS in the Baltic Region: Trade between the

Netherlands and Latvian Republic . . . . .. Il. -167 2.14.1. Introduction . . . .. 11. -167

2.14.2. Case Study Analysis ... Il. -167

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The Competitive Position of SSS -Contents -xv

2.15. Case Study IOd: The Potentia! ofSSS in the Ba!tic Region: Trade between the Nether!ands and the Lithuanian Republic . . . .. Il. -175 2.15.1. Introduction .. ... Il. - 175 2.15.2. Case Study Analysis ... ... .. Il. -175

2.16. Case Study IOe: The Potentia! of SSS in the Ba/tic Region: Trade between the Nether!ands and Ka!iningrad Region ... 11. - 183 2.16.1. Introduction ... Il. -183 2.16.2. Case Study Analysis ... Il. -183

2.17. Conclusions ... ... ... II. -193

CHAPTERIII MODAL SHIFTS THROUGH TECHNOLOGICAL INNOVATIONS

3.1. From 'Genera!' to 'Specific' Cargo Shifts infavour of Short Sea Shipping ..... lIl. - 1

3.2. Traffic Shifts from Road Hau!age to Short Sea Shipping through

Techno!ogica! Innovations ...... III. -3 3.2.1. Introduction ... lIl. - 3 3.2.2. The Impact ofInnovation in Short Sea Shipping ... lIl. - 6 3.2.3. Fast Cargo Ships ... ... lIl. - 9 3.2.3.1. The Fast Ship Market ... lIl. - 9 3.2.3.2. Fast Ship Types in Use Today ... lIl. -10 3.2.3.3. The Economies of Speed in Maritime Transport ... III. - 11

3.2.3.4. 3.2.3.5.

Logistical Cost Comparison ... ... III. -16 Policy Recommendations ... lIl. -28 3.2.3.5.1. Light Structures for Fast Ships ... lIl. - 28 3.2.3.5.2. Development ofIntermodal Cargo Units

for Road, Rail and sea ... III. - 28 3.2.3.5.3. Flexible Port Operations with Automated

Cargo Handling ... lIl. -29 Analysis of the Competitive Position of SSS

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The Competitive Position of SSS - Contents -xvi

3.2.3.5.4. Energy Saving and Emission Reduction

from High-Power Gas Turbines . . . lIl. -29 3.2.3.5.5. Sea Traftic Control and Safety ... III. -29 3.2.4. Sea-River Chemical Tankers ... lIl. -31 3.2.4.1. Sea-River Lanes Infrastructure ... lIl. -31 3.2.4.2. Sea-River Ships .. ... III. -35 3.2.4.3. The Impact ofSea-River Ships on Chemical Trade

between the UK and Germany ... . lIl. - 41 3.2.4.4. How to Improve the Competitiveness of Sea-River

Tankers ... ; ... . lIl. -55 3.2.5. Selfunloading Bulk Carriers ... lIl. -59 3.2.5.1. Introduction ... III. -59 3.2.5.2. Selfunloader Fleet Development ... ... lIl. - 61 3.2.5.3. Productivity and Economics .... ... ... III. -62 3.2.6. Port Investments ... ' ... lIl. -65 3.2.7. Selfunloading and -Loading Unitload Ships ... lIl. -69 3.2.7.1. Introduction ... III. -69 3.2.7.2. The Example ofthe 'Baltic Advanced Shuttle Service' . lIl. - 71

3.3. Conc/usions . ...... lIl. - 77

CHAPTERW SSS -POLICY RECCOMMENDATIONS TO THE EU

4.1. Introduction . . . .. IV. -1

4.2. Ten Policy Recommendations ... ... .... IV. - 3 4.2.1. Policy Recommendation 1: Creation of Reliable Market Data on

European SSS ... ... ... IV. -3 4.2.2. Policy Recommendation 2: Creation of 'Port-Pairs' as 'SSS-traffic

Development Champions' ... IV. -6

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The Competitive Position o[ SSS -Contents - xvii

4.2.3. Policy Recommendation 3: Creation of Homogeneous EDI-Standards through an EDI-Development Package for Ports and Multimodal

Operators ... ... IV. -10 4.2.4. Policy Recommendation 4: Stimulation of Diffusion of'Entry Barrier

Eliminating' SSS Vessel Designs ... ... IV. - 13 4.2.5. Policy Recommendation 5: Stimulation ofNewbuilding and Rebuilding

ofSSS-Vessels ... ... IV. -17 4.2.6. Policy Recommendation 6: Stimulation of Multimodal Inland Port

Terminal Expansion . . . .. IV. -18 4.2.7. Policy Recommendation 7: Stimulation of Port Developments in

Cohesion Fund Countries and Eastem Europe ... IV. -21 4.2.8. Policy Recommendation 8: Intemalization of Extemal Costs Created by

the Various Transport Modes. . . .. IV. - 23 4.2.9. Policy Recommendation 9: Creation ofthe 'European SSS - Promotion

Service' (ESPS) ... IV. - 25 4.2.10. Policy Recommendation 10: Formal Intra-EU Coordination of

SSS-Support Measures . . . .. IV. - 27

APPENDIX

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The Competitive Position 0/ SSS - Contents -xviii

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List of Tables CHAPTER/ Table

u.

Table 1.2. Table I.3. Table I.3.a. Table IA. Table 1.5. Table 1.6. Table 1.7. Table 1.8. Table 1.9. Table 1.10. Table 1.11. Table U2. Table 1.13. Table U4. Table US. Table 1.16. Table 1.17. Table I.18. Table U9. Table 1.20. Table 1.21. Table 1.22.

Tlte Competitive Position of SSS -Contents -xix

IDENTIFICAT/ON AND ANALYS/S OF EX/ST/NG /NTRA-EUROPEAN TRAFFIC, FOR EACH RELEVANT CA TEGORY OF GOODS AND TRANSPORT CORRIDOR

An outline of the research relevant to SSS . . . I. - 6 Travel time between Helsinki, Finland -Travemunde, Germany .. .... I. - 11 European SSS-corridors ... I. -15 Traffic by the sea mode in the European OECD area -1987

(in 1000 tonnes) . . . .. A. - 1

SSS -1989, BeneluxlGermany -UKlIreland . . . .. A. - 2 SSS -1990, BeneluxlGermany - UKilreland . . . . .. . . . .. A. -3 SSS -1991, BeneluxlGermany -UKilreland ... A. -4 Total traffic -1989, Benelux/Germany -UKilreland ... A. -5 Total traffic -1990, BeneluxlGermany -UKilreland ... A. -6

Total traffic -1991, BeneluxlGermany -UKilreland ... A. -7 Modal split -1989, BeneluxlGermany -UKlIreland . . . .. A. - 8 Modal split -1990, BeneluxlGermany -UKilreland . . . .. A. -9

Modal split -1991, BeneluxlGermany -UKilreland ...... A. -10 Summary of traffic evolution in the BeneluxlGermany

-UKilreland corridor. . . . . 1. -23

SSS - 1989, BeneluxlGermany -Nordic CountrieslPoland . . . .. A. - 11 SSS -1990, BeneluxlGermany - Nordic CountrieslPoland ...... A. - 12 SSS -1991, BeneluxlGermany -Nordic CountrieslPoland ... A. -13 Total traffic -1989, BeneluxlGermany - Nordic CountrieslPoland A. - 14 Total traffic -1990, BeneluxlGermany - Nordic CountrieslPoland

Total traffic -1991, BeneluxlGermany -Nordic CountrieslPoland

A.

-15

A. -16 Modal split -1989, BeneluxlGermany - Nordic CountrieslPoland . . .. A. - 17 Modal split - 1990, BeneluxlGermany -Nordic CountrieslPoland . . .. A. -18 Modal split -1991, BeneluxlGermany - Nordic CountrieslPoland . . .. A. - 19 Analysis ofthe Competitive Position of SSS

(28)

Table 1.23. Table 1.24. Table 1.25. Table 1.26. Table 1.27. Table 1.28. Table 1.29. Table 1.30. Table UI. Table 1.32. Table 1.33. Table 1.34. Table 1.35. Table 1.36. Table 1.37. Table 1.38. Table 1.39.

The Competitive Position o[ SSS - Contents -xx

Summary of traffic evolution in the BeneluxlGermany

-Nordic CountrieslPoland corridor .... ... I. -25

SSS - 1989, BeneluxiGermany - Black Sea Area . . . . .. A. -20

SSS - } 990, BeneluxiGermany -Black Sea Area . . . . . .. A. -21

SSS - 1991, BeneluxiGermany - Black Sea Area . . . .. A. -22

Total traffic - 1989, BeneluxlGermany - Black Sea Area .... A. -23

Total traffic - 1990, BeneluxlGermany - Black Sea Area ... A. -24

Total traffic - 1991, BeneluxlGermany - Black Sea Area A. -25

Modal split - 1989, BeneluxlGermany -Black Sea Area . . . .. A. - 26

Modal split - 1990, BeneluxiGermany - Black Sea Area . . . .. A. - 27

Modal split - 1991, BeneluxiGermany - Black Sea Area . . . .. A. - 28

Summary of traffic evolution in the BeneluxiGermany

-Black Sea Area corridor ..... ... I. -26

Importance of commodity groups (%) in total SSS traffic and total

road traffic in the three combined corridors ... I. -32

Ranking of commodities transported by SSS and by road haulage,

BeneluxiGermany to UKlIreland ..... ... ... A. -29

UKlIreland to BeneluxiGermany . . . . . . . .. A. - 30

BeneluxlGermany to Nordic CountrieslPoland ...... A. -31

Nordic Countries to BeneluxiGermany ... A. -32

BeneluxiGermany to Black Sea Area ... A. -33

Table 1.40. Ranking of commodities transported by SSS and by road haulage,

Black Sea Area to BeneluxlGermany .... ... A. -34

Table lAl. The EU cargo carryingjleet by registration and by ownership (1991) . I. -44 Table 1.42. Summary ofmain characteristics ofthe EU, RE and RW jleets (1992) .. I. -45 Table 1043. Description ofEuropean countries' cargo

carryingjleets-by ownership nationality (1992,/or relevant corridors only) ... I. -46

Table 1.44. Summary ofthe EU, RE and RW jleet characteristics (1992) ... I. -49 Analysis o[ the Competitive Positio" o[ SSS

(29)

Table 1045 .. Table 1.46. Table 1.47. CHAPTERII Table II.l. Table II.2. Table 11.3. Table IIA. Table II.5. Table II.6. Table 11.7. Table 11.8. Table 11.9. Table 11.10. Table lUl. Table 11.12. Table 11.13. Table 11.14. Table 11.15. Tablell.16.

The Competitive Position of SSS - Contents -xxi

Port authorities' appreciation ofSSS in Benelux/Germany ... I. -54

Port authorities' appreciation ofSSS in UKilreland ... I. -55

Port authorities' appreciation ofSSS in Nordie Countries/Poland ... I. -56

ANALYSIS OF THE COMPETITIVE POSITION OF SHORT SEA SCHIPPING.A METHODOLOGY AND EMPIRICAL APPLICA TIONS

Major steps in the SSS - case studies ...... 11. - 3

Critical external and internalfactors for SSS-competitiveness

per route ...... 11. -5 Cost comparison between two transport modes,

hypothetical example . . . . . . .. 11. - 8

Shares of Netherlands/Germany/Denmark - North UK

(excl. N. lreland) trade by port region and mode (%) ... 11. - 15

for the route Netherlands/Germany/Denmark - Northern UK ... 11. - 17

SSS through-costs by mode (UKt) ... 11. - 28

Dedicated 10/10 services, Eire - Netherlands/Belgium and France 11. -41

La/Ia services Eire - France/Low Countries . . . . . . .. 11. - 42

for the route lrish Republic to Belgium and the Netherlands . . .. 11. - 44

Estimated liner tonnage, Republic of lreland and Belgium, 1991 11. - 45

Estimated finer tonnage, Republic of lreland and Netherlands,

1991 ... " ... 11. - 46

Estimated route shares, unit laad traffic Eire - Continent 1991 .. 11. - 47

Estimated costs, direct container service casts, Republic of

lreland - Belgium ...... . . .. 11. -48

Estimated costs, direct trailer service casts, lreland- Belgium

via Le Havre ... 11. -48

Estimated landbridge casts (accompanied trucks) .... 11. -49

Landbridge rail opportunity, lreland - N. France/Belgium 11. -54 Analysis of the Competitive Position of SSS

(30)

Table 11.17. Table 11.18. Tablell.19. Table 11.20. Table 11.21. Table 11.22. Table 11.23. Table 11.24. Table 11.25. Table 11.26. Table 11.27. Table 11.28. Table 11.29. Table 11.30. Table II.31. Table 11.32. Table 11.33. Table 11.34. Table 11.35. Table 11.36. Table 11.37. Table 11.38. Table 11.39. Table 11.40. Table 11.41.

The Competitive Position of SSS - Contents -xxii

1rish Sea routes .... ' ... : ... '.. 11. - 58 Unitload imports and exports, England with 1rish Republic

1991 (1,000 tons) ...... 11. -60

Example oJ costs between South East England and Dublin

by accompanied truck . ...... 11. -61 Example oJ costs between South East England and Dublin

(Central Sea Route) . . . .. 11. - 62 Hypothetical costs, Holyhead - Dublin Bay Jor 800 lane

metre co-pax vessels ... 11. -63 Critical external and internal Jactors Jor SSS-competitiveness

Jor the route 1rish Republic to England ... Il. -64 Service structures by operator, UK -Greece direct . . . .. 11. -70 Leading cargoes, UK to Greece, liner tons 1991 ... 11. -71 Leading cargoes, Greece to UK, liner tons 1991 ... 11. -72 UK - Greece unitised traffic, 1991 (1,000 tons) ... 11. -73 Estimated overland trucking costs, UK -Greece (ECU) .... 11. -74 Container costs, UK -Greece (shared with other markets) (ECU) 11. - 75 Possible rail costs, UK - Greece (ECU) ... 11. - 76 Possible rail costs, UK -Greece via Balkans (ECU) ... 11. -77 Critical external and internal Jactors Jor SSS competitiveness

Jor the route UK to Greece .... 11. -,78 Direct shipping services, UK - 1taly ... Il. - 88 1taly to UK liner tonnages, 1991, leading commodities ... Il. -89 1taly -UK, unitloadjlows, 1991 (1,OOOs tons) ... 11. - 90

UK - 1talian trade: cargo distribution in 1taly by region and

mode 1991 ...... 11.-91 Mode Jor overland traffic, UK - 1taly, 1991 (% by mode) . . . . . .. Il. -92 Estimated direct container costs, S. 1taly to UK (ECU) ... 11. - 92 Estimated costs, overland container UK - North 1taly (ECU) '" 11. - 93 Estimated costs, trailer by road, Manchester to Milan (ECU) . .. Il. - 94 Estimated costs, rail versus road on the mainland (ECU) ... 11. -95 Estimated costs, accompanied truck, Manchester to Milan (ECU) 11. -96 Analysis ofthe Competitive Position of SSS

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Table IIA2. Table 11.43. Table UA4. Table UA5. Table IIA6. Table IIA7. Table UA8. Table IlA9. Table II.50. Table U.51. Table II.52. Table II.53. Table II.54. Table II.55. Table 11.56. Table II.57. Table Il.58. Table II.59. Table Il.60.

The Competitive Position 0/ SSS - Contents -xxiii

Alternative estimated unit costs, UK - Italy, one way . . . .. II. - 96 Critical external and internalfactors for SSS-competitiveness

for the route UK to Italy ... Il. -97 Estimated direct ro/ro costs, North Italy -UK (ECU) ... U. -102 Direct container services, Netherlands -Greece ... U. -104 Leading liner cargoes, Netherlands to Greece . . . .. Il. -105 Leading liner cargoes, Greece -Netherlands ... U. -105 Rotterdam port statistics (containers) 1991 ... .. Il. -106 Critical external and internalfactors for SSS-competitiveness

for the route Netherlands to Greece ... II. -108 Critical external and internalfactors for SSS-competitiveness

for the Mid-Netherlands to Helsinki region ... 11. - 114 Transported annual volumes (1,000 tons) . . . . .. Il. -117 Cost comparison between two transport modes for the route

Mid-Netherlands -Helsinki Region ...... II. - 120 Critical external and internalfactors for SSS-competitiveness

for the route Mid-Netherlands to Warszawa region ... II. -126 General picture of annual volumes (1,000 tons) Netherlands -Poland ... ... II. -129 Critical external and internalfactors for SSS-competitiveness

for the route Mid-Netherlands to Odessa region ...

u.

-

136 SSS annual volumes (1,000 tons) Netherlands -Odessa .... U. -140 Cost comparison between two transport modes for the route

Mid-Netherlands -Odessa region (Dfl.) .... II. -143 Critical external and internalfactors for SSS-competitiveness

for the route The Netherlands to the St. Petersburg region .... II. -151 Critical external and internalfactors for SSS-competitiveness

for the route The Netherlands to the Republic of Estonia . . . . .. Il. -160 Critical external and internalfactors for SSS-competitiveness

for the route The Netherlands/Western Europe to the Latvian

Republic and hinterland ...... II. -168

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Table II.6I. Table 1I.62. CHAPTERIII Table II1.1. Table III.2. Table 111.3. Table 1II.4. Table H1.5. Table 1II.6. Table 1II.7. Table II1.8. Table II1.9. Table

m.lO

.

Table m.11. Table

m.12

.

CHAPTERIV Table IV. I.

The Competitive Position o[ SSS - Contents -xxiv

for the route The Netherlands to Lithuania and hinterland .... 1I. - 176

Critical external and internalfactors for SSS-competitiveness for the route The Netherlands/Western Europe to Kaliningrad

region ... , ... II. -184

MODAL SHIFTS THROUGH TECHNOLOGICAL INNOVATIONS

Classification of innovations in Short Sea Shipping ..... Hl. -8

Fast vessel types (1990) ...... ... 111. - 10 Popular fast ship passenger routes (1988) ... ... lIl. -12 Fast cargo ship competitive factors ... lIl. - 24 Relative weight of competitive factors in rivalry between SSS

and land transport ...... lIl. - 25

Europeanfast cargo ship route evaluation ... lIl. - 26 Comparison of chemical tanker types ... lIl. -48

Belt unloaders: trades and volumes of a major European

operator ... lIl. -60

Selfunloader fleet development ... lIl. -61

Discharge capacity in tonnes/day .... lIl. -62

Capital and operating costs per day ...... ... lIl. -63 Baltic Advanced Shuttle Service ... lIl. - 74

SSS - POLICY RECCOMMENDATIONS TO THE EU

EU supported SSS-programmes . ...... .... IV. - 28

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List of Figures CHAPTERI Figure 1.1. Figure 1.2. Figure 1.3. Figure 1.4. Figure l.S. Figure 1.6. Figure 1.7. Figure 1.8. CHAPTERII Figure Il.l. Figure II.2. Figure 11.3. Figure Il.4.

The Competitive Position ol SSS - Contents -xxv

IDENT/FICATION AND ANALYSIS OF EXISTING INTRA-EUROPEAN TRAFFIC, FOR EACH RELEVANT CATEGORY OF GOODS AND TRANSPORT CORRIDOR

Identification of European SSS corridors . . . . . . 1. - 14 Relative importance of 1-digit NSTIR groups to SSS and road traffic in terms ofvalue and weightfor all corridors (1991) ....... 1. - 33 Commodity flows in absolute weights (tons) and values

(thousand ECU) for the BNLG to UKilreland corridor .... 1. - 34 Commodity flows in absolute weights (tons) and values (thousand ECU) for the BNLG to Nordic CountrieslPoland corridor ... 1. - 36 Commodity flows in absolute weights (tons) and values

(thousand ECU) for the BNLG to Black Sea Area .... 1. -38

Shiptype composition of the EU fleet (nO's of ships) .. . . . . . . . .. A. -35 Shiptype composition ofthe 'Rest of EurojJe'fleet (nO's ofships) . A. -36 Shiptype composition ofthe 'Rest.ofthe World'fleet

(nO's ofships) ...... A. -37

ANALYSIS OF THE COMPETITIVE POSITION OF SHORT SEA SCHIPPING.A METHODOLOGY AND EMPIRICALAPPLICAT/ONS

Profile chart of external factors for SSS on route,

hypothetical example . . . .. Il. -6

Profile chart of internal factors for SSS on route,

hypothetical example . . . . .. Il. - 7

The SSS attractiveness-strength, hypothetical example ... Il. - 9 The SSS attractiveness-strength in a dynamic perspective . . . . .. 11. - 11

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Figure I1.5. Figure I1.6. Figure 11.7. Figure I1.8. Figure Il.9. Figure IUD. Figure Il.11. Figure IU2. Figure Il.13. Figure Il.14. Figure lUS. Figure Il.l6. Figure I1.l7. Figure IU8. Figure 11.19. Figure 11.20. Figure Il.21. Figure I1.22. Figure 11.23.

The Competitive Position of SSS - Contents -xxvi

The Northern part of the UK and the Netherlandsl GermanylDenmark ... II. -16 Profile chart of external factors for SSS on route Netherlandsl GermanylDenmark -North UK ...... . . . . .. Il. -28 Profile chart of internal factors for SSS on route Netherlandsl GermanylDenmark -North UK . . . .. II. - 29 The SSS attractiveness-strength for the unitised trade between

the NetherlandslGermanylDenmark and the North ofthe UK ... II. - 30 Profile chart of external factors for SSS on route Irish Republic -Belgium/Nethe'rlands . . . .. II. -51 Profile chart of internal factors for SSS on route lrish Republic -Belgium/Netherlands . . . .. II. - 52 The SSS atractiveness-strengthfor the route Republic of Ireland-BelgiumlNetherlands . . . .. Il. -

53

Profile chart of external factors for SSS on route Irish Republic -England (Central Sea Route) ... II. -65 Profile chart of internal factors for SSS on route lrish Republic -England (Central Sea Route) ...... II. -66 The SSS atractivenessstrength for the route Republic of Ireland -England/Wales ... Il. - 67 Profile chart of external factors for SSS on route UK-Greece Il. -79

Profile chart of internal factors for SSS on route UK-Greece Il. -80 The SSS attractiveness-strength for the route UK - Greece ... II. -81 Profile chart of externalfactors for SSS on route UK -Italy II. -98 Profile chart of internal factors for SSS on route UK -ltaly II. -99 The SSS atractiveness-strengthfor the route UK -Italy ... II. -100 Profile chart of externalfactors for SSS on route

Netherlands - Greece ... II. -107 Profile chart of internal factors for SSS on route

Netherlands -Greece .... Il. -109

The SSS atractiveness-strength for the route

Netherlands - Greece II. -110

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Figure Il.24. Figure II.25. Figure Il.26. Figure Il.27. Figure II.28. Figure Il.29. Figure Il.30. Figure II.3l. Figure Il.32. Figure II.33. Figure Il.34. Figure II.35. Figure II.36. Figure Il.37. Figure Il.38. Figure Il.39. Figure IlAO.

Tlle Competitive Position 0/ SSS - Contents -xxvii

The route Mid-Netherlands -Helsinki region ... Il. - 118

Profile chart of external factors for SSS on route

Mid-Netherlands -Helsinki region . . . . . .. II. -119

Profile chart of internal factors for SSS on route

Mid-Netherlands - Helsinki region ... 11. - 121

The SSS attractiveness-strength for the route

Mid-Netherlands -Helsinki region . . . .. Il. -122 The SSS attractiveness-strength in a dynamic perspective

on route Mid-Netherlands - Helsinki region . . . .. Il. - 123

The route Mid-Netherlands - Warszawa region ...... II. - 128

Mid-Netherlands - Warszawa region ... ... Il. -130 Profile chart of internal factors for SSS on route

Mid-Netherlands - Warszawa region ... .... 11. - 131

The SSS attractiveness-strength on route

Mid-Netherlands -Warszawa region ... II. -132

The route Mid-Netherlands - Odessa region ... Il. - 139

Mid-Netherlands -Odessa region ...... II. - 141

Profile chart of internalfactors for SSS on route

Mid-Netherlands -Odessa region .... ... Il. - 142

The SSS attractivenessstrength on route MidNetherlands

-Odessa region ... Il. -144

The Netherlands to St. Petersburg region . . . . .. Il. - 154

The Netherlands to St. Petersburg region ... Il. - 155

The SSS attractiveness-strength on the route the Netherlands

to the St. Petersburg region ...... Il. - 156

Profile chart of externalfactors for SSS on route

The Netherlands/Western Europe to the Republic ofEstonia ... Il." 163

(36)

Figure 11.41. Figure 11.42. Figure 11.43. Figure 11.44. Figure 11.45. Figure 11.46. Figure 11.47. -Figure 11.48. Figurell.49. Figure 11.50. Figure 11.51. CHAPTERIII Figure 1II.1. Figure III.2. Figure 111.3. Figure 1II.4. Figure 111.5. Figure 1II.6.

The Competitive Position

0/

SSS - Contents -xxviii

Profile chart of internalfactors for SSS on route

The NetherlandslWestern Europe to the Republic of Estonia ... 11. -164

The SSS attractiveness-strength on the route The Netherlands to the Republic of Estonia . . . .. 11. -165

The Netherlands to the Latvian Republic and hinterland . ..... 11. -171

The Netherlands to the Latvian Republic and hinterland . . . . .. U. -172

to the Latvian Republic and hinterland. . . . .. 11. -173

The Netherlands to Lithuania and hinterland . . . .. 11. -179

The Netherlands to Lithuania and hinterland . . . .. 11. - 180

to Lithuania and hinterland ....... 11. -181

The Netherlands to the Kaliningrad region ....... 11. -187

The Netherlands to the Kaliningrad region ... 11. -188

The SSS attractiveness-strength on the route The Netherlands

to Kaliningrad region and hinterland . . . .. 11. -189

MODAL SHIFTS THROUGH TECHNOLOGICAL INNOVATIONS

The S-curve in technological innovation ...... lIl. -5

Pax, car and cargo ferry development ... 111. - 9

Fast ship production (1990) ... ... 111. -11

Fast ship passengers (1988) ... lIl. -13

Time costs and totallogistical costs in shipping .... UI. -14

Freight rate for alternative ship speeds (cap. 140 trailers) (1992) lIl. -16 Analysis 0/ the Competitive Position 0/ SSS

(37)

Figure lIl.7. Figure Ul.8. Figure Ul.9. Figure BUO. Figure III.I2. Figure UU3. Figure UU4. Figure lIl.l5. Figure lIU6. Figure lIl. 17 . Figure UU8. Figure lIU9. Figure lIl.20. Figure lIl.21. Figure IIl.22. Figure lIl.23. Figure lIl.24. Figure III.25. Figure lIl.26. Figure lIl.27. Figure 1II.28. Figure lIl.29.

The Competitive Position of SSS - Contents -xxix

Value oftimefor different goods (1992) ... UI. -17

Transport time of different transport modes (1992) ... UI. -18

Freight rates of different transport modes (1992) ... lIl. -19

Logistical costs of different transport modes (1992) ... lIl. -20

Europeanfast cargo ship routes . .... lIl. - 27

Sea-river lanes infrastructure in Europe ... lIl. - 32

The Rhine and connecting rivers ... ... lIl. -33

ECMTICEMT classification ... lIl. - 34

Design of coastal ships 1880 - 1950 ... lIl. - 36

Design of coastal ships 1970 - 1990 ... III. -37

New types of European coastal ships ...... lIl. - 38

Sea-river vesselfleet (number ofvessels) 1972 -1992 ... lIl. -39

Sea-river vesselfleet (deadweight) 1972 -1992 ... UI. - 40

Transport alternatives chemical products Ludwigshaven

- Thames ... ... ... lIl. -43

Seagoing IMO 213 chemical tankers and IMO 3

sea-river chemical tanker ... ... lIl. -46

Sea-river chemical tanker ... III. -47

Comparative freight rates route Ludwigshaven/Leverkusen

- Rotterdam - Thames (route 1) ... III. -51

Alternative transport routes for chemical products

(Germany-UK) ... ' ... UI. -52

Comparative freight rates for alternative routes:

Ludwigshaven/ Leverkusen - Rotterdam -Birmingham and

Ludwigshaven/ Leverkusen - Rotterdam -Leeds (route 2) ... lIl. ~ 53

Comparative freight rates route Ludwigshaven/Leverkusen

-Rotterdam -Fawley - Swansea - Manchester (route 3) ... III. -56

Economies of 15,000 dwt bulk carriers .... IIl. - 66

Service radius of ports versus land transports and number

of ports of cal! ... lIl. -71

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/ CHAPTERIV Figure IV. I. Figure IV.2. Figure IV.3 Figure IVA. Figure IV.S. Figure IV.6. Figure IY.7. Figure IV.8. Figure IV.9. Figure IV.lO. Figure IV.ll.

The Competitive Position 0/ SSS - Contents -XXX SSS -POLICY RECCOMMENDATIONS TO THE EU

Classification ofpolicy measures to stimulate SSS . . . .. IV. -2 Impact of Policy Recommendation 1: Creation of reliable

market data on European SSS . . . .. IV. - 6 Impact of Policy Recommendation 2: Stimulation of port-pairs

as SSS-traffic development champions ... IV. -10 Impact of Policy Recommendation 3: Creation of

homogeneous EDI-standards through an EDI-development

package ..... IV. - 13 Impact of Policy Recommendation 4: Stimulation of diffusion

ofEBE-SSSvessel designs ..... IV. -16 Impact of Policy Recommendation 5: Stimulation of

newbuilding and rebuilding of SSS-vessels . . . . .. IV. -18 Impact of Policy Recommendation 6: Stimulation of

multimodal inlandport terminal expansion ..... IV. -21 Impact of Policy Recommendation 7: Stimulation of port

developments in Cohesion Fund countries and Eastern Europe IV. - 23 Impact of Policy Recommendûtion 8: Internalisation of

external costs created by the various transport modes. . . .. IV. -24 Impact of Policy Recommendation 9: Creation of the

'European SSS-promotion Service' (ESPS) ... IV. -26 Impact of Policy Recommendation 10: Formal

intra-EU coordination ofSSS-support measures ... IV. -29

(39)

The Competitive Position ol SSS - Contents -xxxi

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The Competitive Position of SSS - Contents - xxxii

(41)

Chapter I

Identification and Analysis of Existing

Intra-European Traffic, for each Relevant Category of

Goods and Transport Corridor

(42)

(43)

Chapter 1- Analvsis of Existing Intra-European Traffic - 1

Chapter I

Identification and Analysis of Existing Intra-European Traffic,

for each Relevant Category of Goods and Transport Corridor

1.1. A State ofthe Art ofthe Transport Research Relevant to Short Sea Shipping

1.1.1. The Need for Change in the Transport Environment

The current transport environment faces a number of important problems. The ever increasing demand for transport services has led to congestion of the road network. Circumventing this congestion-problem by expansion of the road infrastructure is in most cases not possible. In some European countries (e.g. Belgium and the Netherlands) the road network has reached a point of saturation. Moreover, road haulage is increasingly met with social disapproval because ofthe burden it puts on the environment (exhaust gasses, transport ofhazardous goods).

In addition, disparities in European legislation also seriously inhibit the flow of cargo transported via road traffic. The transit countries at the Eastem edge of the EU -Switzerland and Austria-maintain different weight limits for trucks than the EU Member States. In Switzerland the weight limit of 28 tonnes -the EU standard being 40 tonnes -and the prohibition of trucking at night and during week-ends, has brought about a large shift from road transport to rail transport: rail transport now accounts for 80% of the cargo transit. Even between Member States, legislation is not always identical, e.g. Germany is the oniy EU country which prohibits heavy vehicle traffic during week-ends and holidays. The arguments above imply that the road mode has limited scope for additional growth.

The rail mode, on the other hand, faces problems of an entirely different nature. It is more environment-friendly than trucking, and rail-infrastructure could perhaps cope more easily with additional traffic. Unfortunately, the equipment and facilities are not always adapted to modem cargo carrying units (e.g. standard-size containers).

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Chapter I -Analvsis of Existing lntra-European TrafIic -2

The rail mode, in much the same way as short sea shipping (SSS), is confronted with high

break-even volumes of traffic. Consequently, rail operators will only envisage investrnents in equipment and facilities if demand for rail services is relatively high. Rail companies are to a large extent still government controlled, which leads to an additional disadvantage given that these companies are often less customer oriented and less flexible.

In view ofthe above, SSS and inland navigation could increase their market share in spite of a number of unfavorable characteristics, which include:

long travel time as compared to road or rail traffic; inability to provide door-to-door services; ill adapted to customer-specific needs.

In order to generate shifts of traffic from the road or rail mode towards SSS (or inland navigation), actions need to be taken and new policies are required to ensure cost efficiency and competitiveness of these transport modes.

The European Commission is one of the policy making institutions that has understood the great need for change in the transport environment, partly because it is the 'founding father' of some ofthe most important initiatives that will affect the transport situation in the near future.

The EU's Single Market initiative aims to eliminate all remaining barriers to trade: border

. controls, disparities in national standards and technical requirements, export subsidies, etc ..

Because of these disparities, Europe is today still considered as a partitioned market by most

trading partners, in contrast with unified markets such as, e.g. the USA. It is generally thought

that the abolition of the above barriers to trade will have a significant trade generating effect.

Consequently, the demand for transport services within the EU will rise accordingly. Forecasts

oftraffic growth within the EU over the next 10 years vary between 25% and 45%.

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Chapter 1- Analysis of Existing Intra-European Tra(fic -3

The liberalization of the East -West relations will also affect the demand for transport services. The quantitative evaluation of this increased demand varies considerably depending upon the forecasting institution. 1

By now, several countries have formally applied for EU membership, whereas a number of other countries are still hesitant about EU membership. The possible enlargement ofthe EU with its ensuing trade generating effect, would create additional demand for transport services.

The European Commission has set as its prime objective with regard to transport policy, to investigate alternatives that could enhance a smooth traffic flow and reduce the burden put on the environment by transport flows. SSS constitutes one of the avenues the European Commis sion seeks to explore in order to achieve its goal. This transport mode meets the objectives put forward by the Commission. The shortcomings ofthe road mode favour SSS, to the extent that SSS can alleviate some ofthe bottlenecks in the European road transport system. In Italy such a project has already been undertaken. The VlAMARE project pláns to reduce road congestion by shifting traffic from roads to SSS. These 'Marine Motorways' stand a fair chance of meeting their goals, as many Italian motorways are toll roads, so that carriers are directly confronted with infrastructure costs.2

In surnmary, one can conclude that all political and economic developments ofthe recent past indicate that the demand for transport services will incre~se substantially in the next decade, showing an exponential growth. In order to limit the negative impact on the environment, alternative means of transportation need to be found.

The study: Welchen Beitrag kimn die Seeschiffahrt zur Bewältigung der Transportaufgaben im EG-Binnenmarkt leisten?, conducted by the INSTITUT FUR

SEEVERKEHRS-WIRTSCHAFT UND LOGISTIK, estimates the combined effectofthe Single Market Initiative, the unification ofEast- and West-Gerrnany and the liberalization ofthe East-West relations, to generate an average yearly growth of demand for transport services in the European area of 7.8% until the year 2000.

P. PIKE & G. RABBITTS, Have the Planners Missed the Boat?, p.92. Analysis ofthe Competitive Position of SSS

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Chapter I -Analysis of Existing Intra-European TrafIic -4

1.1.2. An Overview of the Research Relevant to Short Sea Shipping

Over the past decade, relatively few studies have been devoted specifically to SSS. Nevertheless, a substantial body of research in the field of transport economics and logistics has direct or indirect implications for SSS. Table l.I. provides a brief summary of some studies that bear relevance to SSS. Although the list is certainly not exhaustive, it gives a good indication ofthe issues related to the promotion of SSS: the list includes a wide spectrum of activities, none of which can be neglected if SSS is to increase its market share.

The left column of Table l.I. contains the relevant issues for SSS. From top to bottom following subjects have been studied :

Cargo Flow Analysis: analysis of cargoes transported via SSS on an originldestination basis;

Modal Shifts: research into potential shifts of cargo from road or rail mode to SSS;

Fleet Analysis: basic analysis of fleets on a national or regional (e.g. EU) basis, covers both analysis by number of ships and by carrying capacity; includes age distribution of the fleet, categories of ships in the fleet, etc.;

Ship Design & Innovation: research into the development of fast ships, new huIl design, innovations in loading and discharge operations, innovations in containerization and other cargo carrying units, etc.;

Port Infrastructure:

Organizational Structure:

Multimodalism:

Analysis of the Competitive Position of SSS

evaluation of port expansion projects, studies on the improvement of port infrastructure, etc.;

research into organizational structures that support logistics in general and the development of SSS in particular;

the feasibility of incorporating SSS in the total transport chain;

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Information Technology:

Logistics:

Legislation:

Chapter I -Analvsis of Existing Intra-European Tra{fic -5

projects on EDI and networking, evaluation of the strategic role and

l

or use of information

;

covers the whole spectrum of operations between the supply of inputs to the producer and the delivery of the final product to the consumer; a number of studies have tried to assess how SSS fits into the logistics chain; the legal framework that either hinders or stimulates the development of SSS; includes issues such as international registries, free trade associations, cabotage restrictions, disparities in social legislation and tax and depreciation mies of varîous countries, etc ..

The studies have been subdivided into two categories: those that are more of a descriptive nature and those that either include policy measures or are relevant from a policymaker's point of view.

Obviously,such a classification of studies is subject to some criticism: a number of authors might argue that their study includes more than one topic or is relevant to several other activities. Although their criticism might be justified, it should be remembered that the aim of Table l.I. is not to provide the details of each study, but rather to present an.outline of the research which has been carried out up to the present day. In the next sections, some of the studies listed in Table l.I. will be discussed in somewhat more detail.

It should be emphasized that a 'state ofthe art' overview of research relevant to SSS can be found in the book N. WIJNOLST, C. PEETERS AND P. LIEBMAN, European Shortsea Shipping, Proceedings from the First European Research Roundtable Conference on Shortsea Shipping,

26-I

27 November 1992 at the Technical University of Delft, The Netherlands, Lloyd's of London Press, London and New York, 1993.