How should mode competitiveness and profit be balanced in maritime transport? – Vessel speed optimization approach including Northern Sea Route

Wenyi Ding, Ryuichi Shibasaki and Chathumi Ayanthi Kavirathna

Maritime Policy & Management, 2025, vol. 52, issue 6, 837-863

Abstract: Transport between East Asia and Europe heavily relies on maritime transport via the Suez Canal route (SCR), with the Northern Sea Route (NSR) through the Arctic Sea emerging as a new route due to the continuously melting polar ice. However, the dominance of maritime transport faces a threat from railways and airlines, especially for high-sensitivity commodities. This study mainly maximizes the profit of a shipping company from both NSR and SCR services with vessel speed optimization, focusing on the competition between four alternatives quantified by a logit model. The sensitivity analysis is also conducted with expanding ice-classed vessels and fluctuating bunker prices. Our findings show that maintaining a speed of approximately 20kn can capture an additional 10% of the market share for SCR; however, SCR faces challenges if future advancements enable more frequent and cost-effective railway transport. Moreover, besides expanding ice-classed vessel size, tackling the problem of limited capacity may position NSR as a promising competitor. This study contributes to providing an effective and innovative speed-optimization scheme combining economic viabilities and mode choice. It is aimed to (1) provide feasible political insights regarding mode competitions and (2) promote the commercial economic use of various modes, including NSR.

Date: 2025
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DOI: 10.1080/03088839.2024.2417823

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