On the Integration of Logistics Activities by Shipping Lines: The Case of East-Asia

Abstract

In the 1990s, following the challenges imposed by globalisation, the liner shipping industry experienced profound changes, leading major carriers to create ad-hoc logistics business-units. Nevertheless the vertical integration of shipping lines along the transport chain faced important entry barriers in various regions.This paper aims at analysing the impact of such barriers on carriers’ pathways of expansion in the logistics business. It mainly focuses on the East-Asian market, as a relevant empirical case in which important institutional and socio-political obstacles are still in force .Main results disclose sui-generis paths of expansion achieved by major carriers, in contrast with linear constructs of time and space proposed by classical TNC theories. In such respect, port operations reveal to be the most critical stage of the chain. The ‘sidestep’ of the port phase, leading to investments in other on-shore activities (warehousing, inland terminals, etc.) as well as the implementation of aggressive financial campaigns (acquisitions and takeovers), reveal the unfaltering will of top shipping lines: the quick achievement of a successful vertical and horizontal expansion despite environmental obstacles.

Citation

Parola, F., Lee, S.-W. and Ferrari, C. (2006), "On the Integration of Logistics Activities by Shipping Lines: The Case of East-Asia", Journal of International Logistics and Trade, Vol. 4 No. 1, pp. 113-138. https://doi.org/10.24006/jilt.2006.4.1.113