Company Background
Hongkong International Terminals Limited is
the major container terminal operator
in Hong Kong. HIT was founded in 1969 and was formerly known as Mazeppa
Limited. At present, it operates as a subsidiary of Hutchison Port Holdings
Limited. It is the flagship cargo and
container handling operation of Hutchison Port Holdings Limited with 12
berths at Terminals 4, 6, 7 and 9 in Hong Kong Kwai Tsing Port.
HIT serves as a part of the HPH’s global network of port and logistics
operations to provide container cargoes handlings service. HIT adapts state-of-the-art computer systems as well as cutting-edge
technologies in its operations. By this, it aims to be the world’s leading container
terminal operator with goals and value competitive scope through excellence in
service, teamwork and innovation. It is the industry’s benchmark on productivity, efficiency and value-added
services.
HIT's Technology and Operations
In order to increase its efficiency, HIT has put a lot of effort in applying technology in its operations.
For example, HIT has
developed its own in-house simulated system nGen (Next Generation
Terminal System) since 2005 which can provide real-time operations of the port.
The system enables the control tower (Photo 1) to facilitate ship planning, and overall operations monitoring,
equipment utilization, productivity, and costs optimization.
Photo 1
Apart from
nGen, OMS (Operations
Monitoring System) is another technology that is used to help operators visualize terminal operations (Photo 2). Graphic overviews cover the entire container yard down to the details of an
individual container, and this predicts yard congestion so that operators can
better control the logistics.
Photo 2
Apart from
technology, HIT also responds to sustainability in its operations. It uses RMGC (Rail
Mounted Gantry Crane) to replace
majority of cranes. RMGC (Photo 3) can reduce CO2 emission as it is
powered by electricity instead of diesel fuel. In addition, HIT has also
organized some green campaigns for
workers such as rubbish collection trip to the beach and energy saving in the
office.
Photo 3
Interesting Findings
Q&A
In the industry of container port, some
indicators are adopted to evaluate the capacity of container terminal. One of
it we learnt from the site visit is the Twenty
foot Equivalent Unit, TEU. This jargon is referring the standard volume of
an intermodal container used in the worldwide terminals. According to the guide
of HIT, the ports of HIT can handle 20 millions TEU at the same time. In other
explanation, for each container, it can load up to 40,000 to 50,000 bananas.
Therefore, 20 millions TEU reflects the outstanding ability of handling
numerous numbers of businesses.
Apart from the TEU, another indicator of evaluating
a container terminal is the water level
of the port. Generally, a big size cargo ship with high displacement can only berth
at the deep-water port. In Asia,
only developing countries such as China, Hong Kong and Singapore own this asset.
Being one of the countries with a deep-water port, HIT exerts this advantage
and expands their business of transferring bulk of goods to other countries
from the western countries.
Q1: How far is it until HIT
reaches its freight handling capacity and is there any consequent plan in response
to this issue?
A: By now, HIT’s freight
handling capacity is high but not up to the company’s maximum yet. According to
latest feasibility report announced by the Transport and Housing Bureau in
2014, ports built in Hong Kong are enough for handling the current demand.
Building a new port with 60.9 billions is not cost-effective and thus not
recommended. It is not possible for HIT to obtain new ports to increase its
loading capacity and smooth its hustling operation until 2030. HIT is asking
for more land for cargo storage and back
office operations. The company has also paid great effort on improving internal deployment to
increase operational efficiency and free out space for more container storages.
Q2: There are many ports
located in Mainland China and some of them such as Shanghai, Dailian and
Qingdao contain superior geographic advantages. How can HIT overcome the
challenges brought by main ports in mainland?
A: As the functions of port
are different between mainland and Hong Kong, HIT actually does not really
encounter challenges brought by major ports in mainland. For ports in mainland,
their business focuses more on direct shipment. They have larger space for
operation and provide lower cost service for the shipping companies. HIT’s
business mainly focus on transshipment
by taking advantage of the special
geographical location of Hong Kong. As no cargo checking is required in
Hong Kong, ports in Hong Kong are free
ports which customs checking is exempted unless possible suspected cases
are reported. This facilitates the loading of containers and increases the
productivity and efficiency of port operations.
Q3: HIT has introduced a lot
of new technologies in its operations to improve efficiency and customer
satisfaction. How does HIT help its front-line staff adapt to these new practices?
A: HIT provides on-job training and off-site trainings
for their staffs and workers. The company also builds a remote control operation center on the 7th floor of main building
so their labour could work in a better environment, when comparing to the
previous practice of individual operation in the crane.
Q4: What are your
competitive advantages over your competitors in logistic industry?
A: HIT includes comprehensive and high-tech infrastructures
to provide fast and efficient service for their clients. With the assistance of
information systems such as NGen, Guider,
OMS and TOPS, the company can make better use of data such as number of
move, cargo arrangement and time of loading to monitor and improve its capacity
utilization and operation efficiency.
Q5: What role does HIT hope
to play in the Chinese Government’s One Belt One Road initiative?
A: HIT has around 20 ports on the development route of
One Belt One Road such as Yan Tian, Shanghai, Shantou, Shenzhen, Xiamen, etc.
HIT aims to make use of those ports to match
the development and business opportunities brought by Chinese Government’s
One Belt One Road.
Q6: Asian shipping industry
has been suffering from sharp declines in recent years due to more and more
factories have been moving to Africa, how will HIT react to this unfavorable
trend?
A: The trend of moving
manufacturing units to Africa does not pose challenge on HIT’s business which
focuses mainly on transshipment. The biggest challenge HIT currently facing is
the slow growth or even stepback of
global trade. As there is limited resources for HIT to have further
expansion, the company focuses more on cost-cutting
by improving the operating efficiency of the port.
Q7: How HIT can achieve the
highest operating efficiency of the immediate transshipment with the lowest
operating costs?
A: By adopting several advanced information system such as nGen,
Guider and OMS, HIT monitors the
real-time operational performance and provide
instant help when problems occur. For example, they improved the algorithm to streamline the internal logistics or
transportation system. These systems also allow sharing of information along the supply chain and planning for
work and container storage to increase the service efficiency. For example, the
Guider will give alarm if the
containers placed together are not in the same category. Control Tower also
helps to suggest the best route for
transporting cargoes within the port. These changes increase operating
efficiency and lower the operating cost of HIT.
Q8: What are the major
challenges faced by HIT in their daily operation?
A: External
uncontrollable factors, such as accidents happened due to extreme
weather are the challenge faced by HIT. HIT stops operation and reinforces the cargoes on site during typhoons
to reduce the potential damage to goods stored in port. For normal daily
operation, major challenges such as deciding
type of number of deals to be accepted, arrangement of cargo loading, running
of truck transportation are mostly solved by advanced IT system of HIT with
instant monitoring by staff in control tower.
Q9: What exact measures does
HIT incorporate into its daily operations to align with its corporate value of
environmental protection?
A: HIT changes over 90% of her
rubber tyre gantry crane (RTGC) from
using diesel oil only to a hybrid of using both diesel fuel and electricity for
its operations. This type of crane is more clean and environmentally friendly
by reducing the use of non-renewable resources. At Yan Tian port, HIT carried
out the project ‘Shore Power’ which supplies power to mega vessels for berthing
so they can reduce emission when using energy to stop. The company organized
the program 'Go Green' with other terminal operators and participate in various
green campaign (e.g. picking beach garbages) from time to time.
Learning Reflection
In this era of e-commerce
and global trade, Hongkong International Terminals Limited (HIT) plays an
important role as the biggest container
port operator worldwide. A sustainable global supply chain is crucial to
fulfil the dynamic growth of demand for global trade.
HIT leverages on numerous innovative technologies to streamline the operations. For instance, HIT has an Automated Truck Identification System (ATIDS). The system applies RFID technology to keep track on both internal and external container trucks. Meanwhile, the ATIDS will decide optimal routes for the drivers to minimize fuel use and carbon emissions. It greatly reduces lead time and resources required to serve the customers.
We also visited the control tower and they showed us the Operations Monitoring System (OMS) and introduced us the Next Generation Terminal Management System (nGen). From the graphical overviews of the whole container yard, operators can monitor and take quick actions for any operational congestion.
All in all, the technologies and concept of catch-up port at HIT are impressive and greatly contribute to Hong Kong’s position as an entrepot.
References