Article
Economies of container ship size: a new evaluation
Based on recent operation performance data, the earnings and costs of container service have been investigated in the context of two indices developed by the Japanese and used elsewhere in East Asian shipping: charter base and hire base. Although the average size of container ships on the world's main trade routes has increased over the past two decades it is dangerous to generalize about the economies of scale derived from larger ship size. The effects of ship's size on voyage results vary in accordance with such factors as ship's purchase price, level of running costs, level of freight rates, voyage length, achieved load factors and accounting methods used for allocating fixed costs. The question of optimum vessel size, therefore, has no generally applicable answer. Shipowners must compromise.
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