Hawaii Superferry: Is the Speed the Most Important Factor in Moving Cargo?

By Valdez, Michael E.; Bess, H. David et al. | Indian Journal of Economics and Business, March 2009 | Go to article overview

Hawaii Superferry: Is the Speed the Most Important Factor in Moving Cargo?


Valdez, Michael E., Bess, H. David, Marcus, Henry S., Indian Journal of Economics and Business


Abstract

The Hawaii Superferry's entrance into the Hawaiian interisland transportation industry (i.e., freight and passenger) could mark a dramatic change in Hawaii trade. The Hawaii Superferry is expected to provide fast ferry service between the major Hawaiian Islands allowing for same-day service of goods and services. This expected change may cause shippers, state and federal agencies, service organizations, and small businesses to reevaluate their logistical plans. However, in terms of the Hawaii Superferry ' s success, the importance of speed is limited by a number of other specific circumstances, in particular, characteristics such as reliability, frequency, cost, and customer needs.

I. INTRODUCTION

In August 2007, the Hawaii Superferry took its inaugural voyage between Honolulu, Oahu and Kahalui, Maui. This voyage marked the success of more than six years of challenges to begin providing daily ferry service for passengers and commercial clients between the major islands of Hawaii (Oahu, Kauai, Maui, and the Big Island of Hawaii). The Hawaii Superferry currently operates only between Oahu and Maui and is expected to expand to the Big Island of Hawaii in 2009 with the delivery of the second vessel.

II. HAWAII SUPERFERRY'S OBJECTIVES IN STARTING SERVICES

The main objective of the Hawaii Superferry was to provide an alternative to passengers for interisland travel and to commercial clients for the transporting of interisland freight. Prior to Hawaii Superferry, freight could be transported between the Hawaiian Islands either via high speed and costly air freight (less than one hour flying time) or by slower and lower cost barge transportation (about two days).

The new ferry service provides the ability for commercial clients to have same-day, door-to-door service with drive-on/drive-off vehicles. This feature allows for cargo deliveries to be made by producers, suppliers, etc., in the same day using their own vehicles. Ultimately, this new ferry service may allow for numerous business opportunities to occur in the future. For example, the Hawaii Superferry may allow for the expansion of Hawaiian businesses into new neighbor island markets through the potential reduced supply chain costs (e.g., no intermodal costs, reduced door to door transport time, and a significant decrease in shrinkage). This new ferry service also allows for the use of specialty vehicles and tools for service and equipment oriented deliveries (i.e., do not need duplicate vehicles on each island).

Specifically, the authors believe that three types of cargo are ideally suited for the transport speed provided by the Hawaii Superferry. First, the ability to have daily delivery service of specialty goods is well suited for the Hawaii Superferry. Specialty goods include such items as perishable goods (e.g., poi, milk, bread, fruit, flowers, and vegetables) and scientific samples. These items are currently transported between islands via air transport. Second, high valued specialty equipment (e.g., construction equipment, emergency vehicles, and scientific vessels and equipment) is also well suited for the Hawaii Superferry. The new Hawaii Superferry service would allow for companies and agencies to make a fewer investments in large pieces of equipment. Some companies and agencies could instead move their equipment between islands as needed (i.e., reducing the need for duplicate equipment and trucks). For example, a piece of equipment could be stored on Oahu, where it may be used most, but then could be transported to a neighbor island in less than 5 hours door to door. Finally, human-based skills (e.g., consulting, scientific, medical, and engineering) that are based on the most populous island, Oahu, can be employed to the Neighbor Islands on an as needed basis. The new Hawaii Superferry service would allow for the possibility of returning on the same day. It is these types of special cargo that would benefit from shipping services other than air or barge. …

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