Container Terminal Efficiency Analysis

With the increasingly tough competition among container ports, increasing container terminal efficiency becomes the major means for container ports to enhance competitiveness in the market. Accurate and sufficient analysis of efficiency is the basic condition for container ports to be aware of the real situation in order to increase the efficiency of the container terminals.Traditional studies on container terminal efficiency tend to focus on partial productivity measures such as TEU per crane hour. These instruments do not assess the overall efficiency of terminal operations, as they only look at specific aspects of the terminal operation process. This thesis paper introduces the use of Data Envelopment Analysis (DEA) and Bayesian Stochastic Frontier Models (BSFM) in view of measuring container terminal efficiency. A Bayesian Stochastic Frontier Model is a stochastic and parametric method for analysing productive efficiency, whereas DEA is a deterministic method. DEA and BSFM are applied to assess the productive efficiency of Chinese container ports in comparison to other terminals worldwide. The data sample covers 68 container terminals from China and abroad. The results show that both BSFM and DEA result in a comparable terminal efficiency distribution, with slightly more conclusive results fro BSFM. It also shows that Chinese ports as a whole rank rather high in relative efficiency, although a wide range in relative efficiencies does exist in the Chinese container port system.