Economic Impact Analysis of Autonomous Containerised Freight

Advanced robotics is a disruptive technology that has the potential to create massive economic impact. According to a McKinsey Global Institute study in 2013, advanced robotics were identified as one of twelve disruptive technologies to have an economic impact, with an estimated potential to affect $6.3 trillion in labour costs globally (McKinsey, 2013). One application of advanced robotics is the automation of cargo ports, with the intention of increasing profitability for cargo terminals by reducing costs and increasing container handling productivity. They comprise autonomous guided vehicle (AGV) robots equipped with radar and laser guidance technology to navigate and position containers in the optimum and most efficient manner, by minimising space allocation time and providing significant safety improvements. The need to increase cargo capacity to support economic growth is a global trend, which is echoed by Australian reports that acknowledge the urgent need for freight capacity increase. Unless Australian ports are able to expand their capacity by improving their productivity, the growing technology along the cargo supply chain will create a bottleneck in Australian ports that could hamper its economic growth. According to the Bureau of Infrastructure, Transport and Regional Economics (BITRE) data, in the year 2029-30, across Australia, ports will handle almost twice as much capacity as they do today. This capacity increase would require a significant improvement in using the nation’s resources, through optimisation of space and transportation capabilities (BITRE, 2010). The most significant contribution to Australian ports would result from a fully automated system that connects the terminal operating system (TOS) and equipment that would integrate and interface with the terminal logistic system (TLS). This report focuses on advanced robotics able to handle the cargo in Australia's ports, and provides an economic benefit analysis and forecast of moving towards automated autonomous straddle carriers across Australia. Currently Brisbane port operates a fully autonomous straddle carrier terminal, with another due to become operational in Botany Bay, Sydney in 2014. In January 2015 Kalmar announced that it has been awarded a contract to provide an integrated automation system to handle operations at Victoria International Container Terminal Ltd's (VICT) new terminal in Melbourne, Australia (Kalmar, 2015). Autonomous straddle carrier technology can not only significantly improve freight capacity but can also enhance the safety of operations, reducing the potential for manual errors by isolating the workforce from heavy machinery. Patrick – one of Australia leading company for containers stevedoring services reports that in the first year of straddle automation at Brisbane terminal they achieved a 75% reduction in safety incidents that increased with a reduction of 90% in following years (Patrick, 2012) . Findings suggest a net present value (NPV) of autonomous straddle carrier technology in direct impact worth for NSW of around $9.42 to $10 billion between the years 2014 and 2030. Nationally, the estimated NPV revenue gain ranges between around $32.1 billion and $34.1 billion. This study solely focuses on a specific automation technology - straddle carrier technology. A fully automated cargo port has the potential for increased economic impact. Therefore, a broader analysis of a fully automated system and its potential productivity increase should be considered. A cost benefit analysis was not undertaken in this report as innovation studies show that any innovation outcome cannot capture the full benefit to the economy, therefore the costs are normally high and in most cases create no tangible benefit but creates intangibles like knowledge is not easy to be quantified. In this report we present only the final application of a long term process of university R&D effort. Similarly, the safety benefits due to the introduction of this technology were addressed but they were not quantified.