Multi‐product maritime inventory routing with optional cargoes : An application to outbound automotive logistics

Purpose – The ocean transportation of automobiles is carried out by specialized Roll‐on/Roll‐off ships, which are designed to carry a large number of automobiles at a time. Many of these shipping companies have vertically integrated or collaborated with other logistics services providers to offer integrated maritime logistics solution to car manufacturers. The purpose of this study is to develop an optimization model to address the tactical level maritime logistics planning for such a company. Design/methodology/approach – The problem is formulated as a mixed integer linear program and we propose an iterative combined Ant colony and linear programming‐based solution technique for the same. Findings – This paper can integrate the maritime transportation planning of internally managed cargoes with the inventory management at the loading and discharging ports to minimize supply‐chain cost and also maximize additional revenue through optional cargoes using same fleet of ships. Research limitations/implications – The mathematical model does not consider the variability in production and consumption of products across various locations, travel times between different nodes, etc. Practical implications – The suggested mathematical model to the supply‐chain planning problem and solution technique can be considered in the development of decision support system for operations planning. Originality/value – This paper extends the maritime inventory routing model by considering simultaneous planning of optional cargoes with internally managed cargoes.