Liner hub covering problem with elliptical coverage: Improving the cost performance of hub covering problems

Abstract

This paper investigates hub covering problems (HCPs), belonging to the service-type hub location problem, which addresses locating hubs and allocating feeders to hubs. Previous studies on HCPs are concerned with the service performance, leading to a poor cost performance. To improve the cost performance of HCPs, this paper presents an elliptical coverage applied in liner shipping, based on which we propose a liner hub covering problem, determining the location of hub ports and allocation of feeder ports. Following two different types of HCPs, we propose two mixed-integer linear programs as formulations of the proposed problem, which can be solved by CPLEX. Numerical results show that, 1) the proposed problem improves the cost performance of HCPs; 2) the proposed formulations give more practical results of the location of hubs and feeder allocation, as compared with conventional formulations of HCPs.