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A cooperative shipment consolidation game with emission considerations

2020
Keven, Halit.
Logistic operations constitute one of the most significant cost components for many companies. Furthermore, these activities have turned out to be one of the main causes of carbon emissions in the world. The carbon emission issue has been under the spotlight in many countries due to the rising concerns about global warming which brought about new regulations. Large majority of these regulations tend to increase the total costs of logistic operations by a variable factor directly related to carbon emission amounts, so that companies have to consider costs related to carbon emissions resulting from their logistic operations as well as direct costs like fuel consumption. To compensate the increase in the cost amounts new approaches need to be developed. One way to achieve increased operational efficiencies under such a problem environment might be collaboration with other companies which also involves a competition on a smaller scale. In our study, we consider a market characterized by uncertain shipment requests where shippers are willing to collaborate for their shipment activities. They also compete for truck space within this collaboration process. We assume that the companies aim to maximize the profit from their shipments. We assume the shippers form a coalition and make dispatch decisions vii jointly. To ensure a fair and stable allocation of the savings we develop allocation schemes that require a low computational effort. We evaluate and compare the schemes based on several criteria.