LACK OF SLACK?
Our results show that it is the ‘unexpected’ and ‘unanticipated’ -e.g., a natural disaster; a war; a tsunami; or COVID19-that poses the greatest risk to carriers: Intense competition amongst them, geared to short-term profit maximization, coupled with the fine-tuning of capacity management within alliances, does not allow them the luxury of affording built-in buffers, or slacks, that could ‘absorb’ the unexpected. Not unexpectedly therefore, COVID19 has been the greatest risk factor of all times, mitigated –quite profitably one should add—by the joint capacity management of global shipping alliances. (Open Access: https://lnkd.in/dV9mkY7Y)