The Logistics Terminal

Is the Port of Tilbury’s future in automation?

Is the Port of Tilbury’s future in automation?

Across the globe, ports are trying to go green for the sake of the environment in an effort to make logistics a major contribution into the prevention of improving the air we breathe. However, with the recent introduction to the latest technologies on the market – researchers are wondering whether automation will begin to play as significant of a role within logistics as environmental solutions currently do.

A report published by McKinsey & Co discovered that “Automated ports are generally less productive than conventional counterparts” also “While operating costs decline so does productivity, and the returns on capital are currently lower than the industry norms.”

One of the biggest examples of a proposed automation-focused port, is currently held at the Port of Los Angeles, speaking on the matter was Dane Jones of Longshore & Warehouse (ILWU): “Automation is expensive, whether fully or semi-automated, it requires hundreds of millions if not billions to construct and retrofit full-size modern container facilities.

A container operator must also pay for facilities upgrades, software solutions, product support and maintenance. A marine terminal earns revenue by moving cargo and automated container ports do not move cargo as quickly or profitably as those worked by people.”

McKinsey also had figures from the report, showing the expenses of a greenfield terminal to be around 25% less than that of a conventional terminal, also meaning productivity at the terminal would need to increase by 30% and operating expenses cut by 10% if ports were hoping to make it a beneficial investment.

There is a decline in costs from automated ports, but it is only ever between 15-35%, this is dealt a heavier blow by productivity falling at around 7-15%. According to a global port operator McKinsey spoke with during their research, average gross per hour for quay craned – which is an ideal way to identify productivity – was estimated to be below the 30s.

Most conventional terminals have a minimum of reaching high thirties. “With numbers like these, automation can’t overcome the burden of upfront capital expenditures.” McKinsey concluded in their report.

In the Port of Los Angeles, the deadline of 2030 has been set for handling of all cargo and equipment in the facility to be zero emission – which would likely mean full automation for the port. While the Port of Tilbury has no such deadline at the moment, it is possible that in the future there will be higher demand to meet environmental standards if other ports across the globe try to match the standards that the Port of Los Angeles is aiming to meet, setting a worldwide standard for other ports as officials aim to reduce the level of emissions impacting the environment in the industry, which could lead the Port of Tilbury as well as many others aiming for automated solutions.

While the Port of Tilbury is currently seeing development with the addition of Tilbury 2, a facility expected to support much more cargo in-and-out of the terminal – further developments are being evaluated and considered by Forth Ports. While the costs at this time are unknown, the possibility will be considered of the port adding the addition of automated technology – especially if pressure is applied by Government officials for ports across the country to match the standards set by the Port of Los Angeles by 2030, or another deadline.