Pricing and equity in strategic berth allocation problem considering general and dedicated service modes

Port operators can enhance their competitiveness by strategically adjusting service charges to attract more vessels from neighboring ports. In terms of service equity and profitability of the port, a novel vessel-oriented and port-oriented strategic berth allocation problem (SBAP) is proposed to determine the service fee charged to each liner carrier and the accepted number of arriving vessels in a port. In addition, two service modes in the port are introduced: the general service where incoming vessels from liner carriers share general berths and queue for service, and the dedicated service where selected berths are reserved for a specific liner carrier, exclusively serving its vessels. By modeling vessels and berths as customers and servers, we formulate the SBAP as a queueing system with different queueing structures corresponding to each service mode. To maximize port profits while ensuring service equity among liner carriers, a bi-objective mixed integer programming (BMIP) model based on queueing theory is formulated by determining the proper pricing, queueing structure and the quantity of dedicated berths reserved for individual liner carrier. To efficiently solve the BMIP model and obtain the Pareto frontier, we design a solution approach combining the ε-constraint method with a non-dominated sorting strategy. Numerical experiments demonstrate the effectiveness of the proposed model and solution method.