The future of container terminal investments.A study on investments in container terminals

The main research question for this research project was: “How do future investments in extra container handling capacity stand up against the actual capacity used?” To answer the main research question, several ports in the Hamburg – Le Havre range were selected and analyzed. The selected ports were analyzed on several indicators, namely: threats, strengths, TEU volumes, container market share and the future developments. These port profiles became the basis to conduct empirical analysis on the annual figures per port, and also for the entire Hamburg – Le Havre range. Through analyzing the TEU volumes and the container market share of the several ports, it became clear that the TEU volumes has risen fast the last two decades and, secondly, that the container has become of more importance to the ports. The container market shares have risen fast, from 1975 till 2009, and an interesting point to see is that the container market shares are very different per port. The German ports have the highest container market shares with around the 70% in 2009. This means that the container is of great importance for the revenues of these ports. The port of Antwerp is steady in the middle with around the 55% in 2009, which means that the container is important, but can be compensated by other commodities. The ports of Rotterdam and Le Havre show a minority for the container market share, with around the 30% in 2009. This means that other commodities are of more importance for these ports, and that the investments in extra capacity should be investigated. Empirical analysis has shown that there seems to be a split between two groups of ports. On the one side, the ports of Rotterdam, Antwerp and Le Havre. On the other side the ports of Bremen and Hamburg. Where the port of Rotterdam, Antwerp and Le Havre seem to be overinvesting, the port of Bremen and Hamburg seem to be under investing the market. The answer to the main research question can be answered on different levels of scale. When looked at the ports individually, the conclusion should be that it seems that three ports (Rotterdam, Antwerp and Le Havre) are overinvesting the market. The initial investment decision of these ports can not be justified by the forecasting figures seen in the empirical analysis. The two German ports (Bremen and Hamburg) seem to be under investing the market. The initial investments decision can be justified by the forecasting figures seen in the empirical analysis, but the new maximum capacity will be reached on short term. The fact that the container is also the most important commodity for these two ports, brings to the conclusion that the initial investment decision is correct, but the volume of extra capacity is too low to meet long term future demand. When looked at the Hamburg – Le Havre range as a whole, the conclusion should be that the region is operating fairly good. The growth rates are constant, but good and in line with the market development. The investments decisions seem correct, when an overcapacity of 43% is reached by 2020 when the investments are done. When the investments are not done, the overcapacity for the Hamburg – Le Havre range in 2020 lies around the 9%. This brings to the conclusion that the Hamburg – Le Havre range needs to invest in extra capacity, and that the extra capacity of 36 million TEU annually is a good number to meet demand in the future. This conclusion is only based on the Hamburg – Le Havre range, thus that some ports face high overcapacity is not taken into account. This means that, when looked on different levels of scale, different investment decisions and conclusions can be drawn from the empirical analysis.