Innovation in the Shipping

Industry

AGENDA
Shipping Industry Overview
Market Force Analysis
Factors Affecting Innovation in the Shipping
Industry
Shipping Industry and Path-Breaking Innovations
Analysis and Conclusion

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Innovation in the Shipping Industry

Shipping Industry Overview

Overview
Shipping is a global industry and its prospects
are closely tied to the level of economic activity
and is cyclical in nature
90% of world trade is transported on water
Due to bigger vessels and economies of scale
partly also because of the appearance of
standardized containers
The shipping network is highly clustered, its
clustering coefficientis 0.49, which can be
interpreted that any given nodes neighbors are
also connected to each other

Worlds largest
container shipping
company
3.8 million TEU annual
capacity
Owns >600 vessels

Maers
k

Known across the globe

as a container shipping
heavyweight and cruise
liner operator
an annual capacity of
2.3 million TEU

MSC

French shipping
company which was
founded in 1996
Capacity of 1.56
million TEU

CMS

Major Players

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Innovation in the Shipping Industry

Market Forces
Analysis
Barriers to
Entry
Highly Capital
Intensive
Expertise and
know-how are
critical factors
Bargaining
Bargaining
power
power of
of
suppliers
suppliers
Diminishing
Diminishing
with
with gradual
gradual
increase in fleet
supply
supply and
and
intense
intense global
global
competition
competition

Supply
Determined by
Determined
by
the
the addition
addition to
to
shipping
shipping capacity
capacity
In
In 2016,
2016, 900,000
900,000
TEU
TEU worth
worth of
of
ultra
ultra large
large
container ship
capacity
capacity was
was
delivered
delivered

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Bargaining
Bargaining
power
power of
of
customers
customers

Competition
Competition is
price based.
However,
companies
with younger
fleet
command a
premium

High bargaining
power as
competition is
high in the
industry.

Demand
Closely related
to growth in
world trade
Expected to
be tepid at ~
2%

Innovation in the Shipping Industry

Factors Affecting Innovation in the Shipping Industry

Innovation currently
can be classified as
revolutionary in
nature
Driven mainly by
sustainability in
efficiency and
environmental
implications
Competitive Priority
Indices
Cost
Safety
Environment
Friendliness

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Factors Driving
Innovation/Inno
vation Type

Increment
al

Evolution
ary

Revolutio
nary

Prime Mover

Market
Forces

Market
Forces

Interplay
between
scientific,
economic
and
institutiona
l factors

Costs/Resources

Small

Large

Very Large

Issues/Opportun
ities

Existing or
predictable

Both
existing
and new

New

Associated
Uncertainty

Small

Small to
large

Cannot be
assessed

Markets

Targeted at
existing
markets

Targeted at
existing
and new
markets

Disrupts
existing
markets

Innovation in the Shipping Industry

Shipping Industry and Path-Breaking Innovations

Containerization
Developed after World War II, the
system of standardized containers of
20X8X8 ft revolutionized the shipping
industry setting up a uniform
container measurement specification

Key Effects
Reduced congestion in ports
Significantly shortened shipping
time
Reduced losses from damage and
theft
Dramatically reduced transport
costs
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Innovation in the Shipping Industry

Shipping Industry and Path-Breaking Innovations

Airbag Ship Launching &
Hauling Method

The main idea is to inflate "air bags" under

the ship used to launch ships into the sea

Key Effects
Versatile and Cost-Effective
Possibleto build & repair in massive
scales without having to turn down
businesses
Stay extremely competitive without
having to build costly docks/rails to
increase their capacity

Advance Outfitting
Assembling the outfit components
like machinery, seating structures
and piping etc into a small unit,
that is then fixed at the planned
position in the hull block itself.
Key Effects
Shipbuilding cycle time is reduced
drastically
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Innovation in the Shipping Industry

Shipping Industry and Path-Breaking Innovations

Green-Ship
Technologies
No Ballast System
Ballast water convention by IMO focuses
on reducing the transit of sediments and
micro organisms of one territory to
another through the ballast of ships. A no
ballast ship or similar system can
drastically reduce this problem
It creates a constant flow of local seawater
through a network of trunks, running from
the bow to the stern, below the waterline,
thus reducing the potential hauling of
contaminated water across the ocean

Key Effects
Helps in reducing
environmental ecosystem
hazards
Net capital cost savings of USD
540000 per ship
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Sulphur Scrubber System

Exhaust gas scrubber system
wherein the sulphur is washed
out from the exhaust gas of the
engine resulting in reduction of
SOx up to 98 % along with other
harmful particles

Innovation in the Shipping Industry

Shipping Industry and Path-Breaking Innovations

Waste Heat Recovery

System:. The waste heat from
the exhaust gases can be
utilised to heat and generate
steam which in turn can be used
for

Solar Cell Propulsion: The fuel cell

propulsion utilizes power from a
combination of fuel cells, solar cells
and battery systems.
Key Effects
Reduction of GHG emission to a great
extent by 35-40%

Sandwich Plate System (SPS): It is a

process of composting two metals
plates by bonding it
withpolyurethaneelastomeric core.
This avoids usage of steel which
requires additional stiffening hence
makes the structure light weight and
less prone to corrosion.
Key Effects
Superior in service performance
Reduced through life maintenance

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Innovation in the Shipping Industry

Shipping Industry and Path-Breaking Innovations

Smart
Ships
Through the use of
nanotechnology in paints, coatings
and materials, while ultra-sensitive
monitoring through the use of
acoustic fibers will allow the
detection of minute changes in
vibrations
New maritime world voyage data
Key Effects
and data from ship structures,
Optimize routes that
components and machinery will be
are tailored to the
collated and used to enhance
capability of the ship
performance,
Safety and
productivity and, crucially, safety
Ships bridges will be solely
productivity would
increase
focused on
processing high level data analysis
to operate on-board systems to
manage propulsion and navigation
Future Operator Experience
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Innovation in the Shipping Industry
Concept
or oX

10

Shipping Industry and Path-Breaking Innovations

Automatic
Ports

Automatic cranes carry out the

unloading activity from the ship-toshore and transfer it on to a
driverless flatbed vehicle which an
operator can perform sitting in an
office with a computer screen and
joystick
The driverless flatbed vehicles with
built-in lifts work with sensors
technology, transponders and
software which helps it reach the
intended destination without any
collisions
The cargo is then automatically
shifted to the designated
rackspace

Key Results
Two Automated Cranes on rails carry out the
task of loading the cargo again on a driverless
flat-bed vehicle completing the unloading
process

Fewer accidents,
Lower costs,
50% increase in efficiency

Shipping Industry and Path-Breaking Innovations

Innovation in Business
Practices

MultiCore pipeline/Multi-User
Terminals

Anti Corruption Network

The Maritime Anti-Corruption
Network (MACN), a global business
network of companies and
associations involved in the
maritime industry
The IACA recognizes creative,
standard-setting approaches to
compliance with international antibribery laws

Leasing of Pipelines for transportation of oil

and gases for a specific period of time

Key Effects
Earlier availability than the construction of a
new own pipeline;
Environmental friendly, safe and
uninterrupted mode of transport;
CO2 reduction and decrease in traffic
congestion;
Efficient use of space
Strengthening of the oil and chemicals cluster

Daily Liner Services

The worlds biggest carrierlaunched the Daily service,
with ships departing daily westbound on the Asia
Europe trade lane.
consisted of four port calls in Asia
Seventy ofMaersk Lines largestPanamaxandEmma
Maersk-type container vessels will be deployed as part
of the service, which will account for 25% of the lines
total tonnage
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Analysis And
Conclusion
Concept

Strategic
Focus

Sustainability

Value
Innovation

Containerizatio
n

High

High

High

Airbag
Launching and
Ship Hauling

Moderate

High

Low

Advance
OutFitting

Moderate

Moderate

Moderate

GreenShip
Technologies

High

High

High

Smart Ships

High

High

High

Automatic
Ports

High

Moderate

Moderate

Business
Practices

High

Moderate

Moderate

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Analysis And Conclusion

Open and Collaborative Innovation

Greater Role of Regulatory Bodies
Value Innovation should be aligned for strategic focus and
Sustainability
Clarity in the role played by each player in the industry
Efficiency, Economy and Environmental Implications
driving the key factor in Innovations

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Innovation in the Shipping Industry

14

Thank You

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Innovation in the Shipping Industry

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