The potential for coordination between air and ocean transport in advancing Net Zero policies

This study explores ways to achieve a modal shift in cargo transport markets for high-value commodities, with particular emphasis on shippers' awareness of climate change. Specifically, it aims to (i) provide insights for carriers in designing efficient cargo transport networks aligned with Net Zero policies; (ii) examine the robustness of the results by discussing the feasibility of sea-and-air services for high-value commodities while accounting for heterogeneity in shippers’ behavior; and (iii) inform policymakers in their efforts to support and facilitate such modal shifts. We apply a bi-level model to a simple four-node network and examine several scenarios by explicitly incorporating heterogeneity among shippers. The main findings are as follows. First, as shippers’ awareness of climate change increases, the share of all-air services declines in each market; notably, this decline is much larger in long-haul markets than in short-haul markets. Second, when the level of awareness among time-sensitive shippers is relatively low, the resulting reduction in GHG emissions in both markets remains quite limited. Third, if time-sensitive shippers with a high level of awareness of climate change occupy the major part of the market, ocean transport can become a feasible option for carrying high-value commodities. Under this condition, short-haul markets may become more competitive, whereas long-haul markets may exhibit greater cooperation between air and ocean transport.