The Future of Ports in the Physical Internet

Abstract

Freight transport and logistics (FTL) produce around 15% of the world’s GDP and account for approximately 10% of finished product costs on average. However, through its contribution to the carbon footprint and traffic congestion, today’s FTL operations are often considered to be non-sustainable from an economic, environmental, and societal perspective. Transportation marks its presence with over 30% of the global carbon emissions. Additionally, as demonstrated by regular disruptions and the resulting shock-effects on international trade and manufacturing, the global FTL system suffers from vulnerabilities and lack of resilience.
In addition to being critical components in the FTL system, maritime ports function as facilitators of international trade, through which they contribute to the economic development of countries and regions. Over centuries, maritime ports have evolved from simple gateways between land and sea into highly complex systems with a large and diverse number of stakeholders being involved, and various types of services being offered. This has caused maritime ports not only to function as (transshipment) hubs in FTL networks, but also a location where industrial and value-added services take place. In this way, ports can be considered as dynamic organic systems within both national socio-economic-political and globalized economic systems, where ports need to continuously adapt to their external environment by changing economic and trading patterns, new technologies, legislation, and port governance systems.
An innovation that is expected to impact the current economic and trading patterns, technologies, legislation, and governance systems, is the Physical Internet (PI). The PI is an all-encompassing vision for a future FTL system that transforms “the way physical objects are moved, stored, realized, supplied and used across the world”, aiming towards greater economic, environmental, and societal efficiency and sustainability. By analogy with the digital internet (DI), physical shipments are encapsulated into multi-level modular containers and sent through an open hyperconnected network of logistics networks to their final destinations. The PI is defined as “a hyperconnected global logistics system enabling seamless open asset sharing and flow consolidation through standardized encapsulation, modularization, protocols and interfaces to improve the efficiency and sustainability of serving humanity’s demand for physical objects”...