- White Papers
- Research Publication
Authors: Saurabh Chandra, Marielle Christiansen and Kjetil Fagerholt
In the maritime transportation of automobiles, roll-on/roll-off (ro-ro) shipping companies operate liner shipping services across major trade routes. Large ro-ro shipping companies are well placed to offer end-to-end integrated logistics services to auto manufacturers engaged in international trade of vehicles. Therefore, we present a new mixed integer programming model for fleet deployment including inventory management at the ports along each trade route. Due to the complexity of the problem, a rolling horizon heuristic (RHH) is proposed. The RHH solves the problem by iteratively solving sub-problems with shorter planning horizon. Computational results based on real instances are presented.
Authors: Saurabh Chandra, Debabrata Ghosh, and Samir K. Srivastava
Outbound logistics management practices, specific to India have drawn limited attention in the past. Recently though, this sector has garnered the renewed attention from researchers and practitioners. Through an exploratory study, we attempt to understand and illustrate the outbound logistics management practices of the automotive industry in India. Outbound logistics is divided into a set of interlinked functions based on a logistics framework and described accordingly. Based on findings from the exploratory study and extant literature in this field, a framework for the development of integrated logistics management practices in the automotive industry in India is derived, and several research directions are proposed.
- Ongoing Projects
- Coastal shipping viability
Authors: Saurabh Chandra, Marielle Christiansen and Kjetil Fagerholt
Indian automotive manufacturers rely mainly on direct truck deliveries from their assembly plants to the dealers/customers across the country. As India has an extensive coastline and railway network, companies should be able to develop more efficient ways of distribution. Such modal shifts are expected to reduce logistics costs and decongest the existing road network. We select a major Indian automotive manufacturer based in the southern part of India, operating with 12 ports in the country as potential ro-ro (roll-on/roll-off) terminals to analyze the modal shift from primary road based distribution to coastal intermodal shipping. Regulatory framework and policy initiatives related to this area are discussed along with challenges faced in logistics operations. A mixed integer linear programming model is developed to test the viability of modal shift. The mathematical model minimizes the total cost of distribution and suggests the extent of modal shift, optimal selection of vessel types, route options and port usage in distribution. Application of the model to the case study shows that a major modal shift can be achieved by full-scale implementation of coastal intermodal shipping for automotive distribution. The suggested scenario calls for favorable regulatory framework and infrastructure development. Appropriate port tariff structure, tax rebates and priority in port usage for coastal vessels are required. In terms of infrastructure, regional major ports need to be developed as ro-ro terminals, with the ability to handle large vessels, availability of efficient cargo handling facilities and last-mile connectivity to customer locations.
- Maritime system design
Authors: Saurabh Chandra
Abstract: Coastal shipping is an upcoming mode of transportation in India. So far, the mode is generally used for bulk cargo. Other freight has been tried on an irregular basis. A firm carrying out a major part of its domestic freight logistics within India needs to design a maritime supply chain network to minimize the cost and maximize the effectiveness of this mode of transportation. To this end, we take the case study of a logistics company trying to develop a coastal shipping based maritime logistics system for the distribution of finished automobiles from the factories to the dealers all over India. We propose a MILP model for the same and run a simulation with real data to find appropriate vessel types, ports, routes, port-destination linkages, and storage areas required at various locations. This model considers inventory holding cost along with transportation cost for multiple variants of the product. Thus, which of the variants to ship using coastal and which ones using direct trucking will also be suggested.
- Bottlenecks in the development of coastal shipping in India
Authors: Harshal Lowalekar and Saurabh Chandra
Abstract: For a country like India with a long coastline, coastal shipping or short-sea shipping is an environmentally friendly and sustainable means of transport. Shifting cargo movement to coastal shipping will also alleviate the existing roadways and railways transportation from rising congestion and associated economic and social costs. Several issues in the development of coastal shipping in India have been identified in previous studies. The important ones are strict cabotage laws, underdeveloped infrastructure, and complex port procedures, underdeveloped minor ports, poor hinterland connectivity of ports, competition with foreign going vessels at ports for berthing, lack of collaborative planning between shippers and logistics companies. The government realizes the importance of coastal shipping and has introduced a supportive policy framework, which is expected to remove or reduce most of the identified constraints. Consequently, there has been a steady rise in the share of coastal shipping, although very slow. In this paper, we attempt to identify the major bottlenecks in the development of coastal shipping in India under the existing policy framework through a rigorous cause-and-effect analysis. It is shown that the poor state of affairs in the coastal shipping system is largely due to very few policies. Such restrictive policies which have led to slow development of coastal shipping are identified, and the recommendations are made to eliminate such policies. This research shows that that elimination of such policy constraints will go a long way in improving the state of coastal shipping in India.
- Incentive design model for supply chains involving coastal shipping and logistical services
Authors: Omkar P. Desai and Saurabh Chandra
Abstract: In the underdeveloped economy of India, almost 96% of ready-to-sale automobiles are dispatched from manufacturing plants to intermediary dealer locations on specialized trucks on road. In recent years, a handful of logistics service providers have offered sustainable and environmentally friendly solutions involving a coastal shipping mode. The particular mode of transportation is cost efficient for the supply chain players as well. Nevertheless, the critical challenges in coastal shipping in the highly competitive industry are relatively smaller supply volumes of individual manufacturers and demand from dealers individually, and longer lead times. Thereby, the coastal shipping mode of transport is less attractive for dealers as their profitability is directly linked with the financial turnaround in the channel connecting manufacturers and downstream customers. An alternative to improve the attractiveness of coastal shipping mode to dealers and to ensure sustainability of the supply channel is to share the logistical benefits with dealers and/or with end-customers. We develop an analytical model using game theoretic techniques to characterize decision making problems of the players involved in the entire supply chains. Our aim is to examine incentives for the supply chain players to adopt coastal shipping.
- Impact of Shipping Freight Sentiment on Stock Return, Liquidity and Volatility: A Multi-Country Experience
Authors: Saumya R. Dash, Debasish Maitra, Satya R.Sahoo, and Saurabh Chandra
Abstract: In recent years, there are increasing evidence of significant sentiment related factors influence on global stock market, commodity market, and future contracts (Baker and Wurgler, 2206; Deeney et al., 2015; Debata et al., 2017; Han, 2007; Papapostolou et al., 2016). The increasing evidence of asset pricing beyond the theoretical prediction of rational pricing has been a cause of concern for both policy makers and investors. Among the growing body of literature much less focus has been given to the sentiment based pricing for the shipping industry. Existing literature (Papapostolou et al., 2014, 2016) suggest that there is an important global shipping sentiment variable. However, the application of this variable is only limited to aggregate stock return behavior of certain selected countries (Papapostolou, 2016). There is scope to extend the literature of shipping sentiment with finer proxies and the application of the proxy for managerial decision making in terms of stock return behavior, volatility of the return, and the liquidity of the study. No study till date explores this issue on a large sample. This conspicuous gap in the literature motivates us to carry out a study by examining the impact of shipping freight sentiment on stock return, liquidity and volatility on a multi-country sample.