Container terminal automation: what does the future really hold?

Container terminal automation has been a regular feature on the TOC conference agenda for many years now, as owners, vendors and consultants have charted the progress of robotised and remote-controlled handling systems along with the transition from manual to automated processes across gate, yard and berth. From advances in equipment and software, to project management, performance metrics and standards, greenfield start-ups and brownfield conversions, M&R, the man-machine interface, safety, skills development and more, debate has been animated, candid and, at times, heated.

TOC Europe 2018 promises to be no exception, not least during the 2nd Terminal Automation Workshop. Held on 12 June as part of the free TECH TOC seminars, the workshop features terminal operators and consultants with first-hand experience of the potential and pitfalls of automation. They include:

Joost Achterkamp, Managing Director, Solid Port Solutions

Jan Cuppens, Director Global Engineering, DP World

Alex Duca, Director, Head of Automation Program, APM Terminals

HH Prince Pieter-Christiaan van Oranje-Nassau, Chairman, Milan Ops

Pekka Ranta, Senior Manager - Container Terminal Technology & Operations Optimization, Moffatt & Nichol 

Dr. Yvo Saanen, Commercial Director, TBA Group

Tom Ward, Director – US Maritime Planning, WSP (moderator)

Ahead of the big day, the TOC team asked panel members 9 key questions on the state-of-the-union and next steps for container terminal automation.

The first in this special 3-part series explores:

1. How automation is living up to expectations today

2. The key business drivers for automation

3. How digitalisation is impacting the automation landscape

TOC: How well is technology to automate and robotise terminal operations living up to expectations on performance, productivity, reliability and ROI?

Tom Ward (TW): Productivity expectations seem to be set higher than is readily obtainable, to justify investments. In some cases, that productivity can be achieved with significant effort and time, but not always, and not always consistently. This issue is more common in fully-automated terminals, where the complexity of fleet control is higher, and randomness can swamp automated decision-making. Making the ROI is definitely possible, but it requires a LOT of patience and forbearance by the owner.

Yvo Saanen (YS): If we look at matured fully-automated terminals using the (almost) latest technology - Euromax Rotterdam and CTA Hamburg - they prove that automated / robotised technology does live up to expectations, certainly on productivity, reliability and ROI. They both operate consistently at very high utilisation, and at good productivity levels, especially when looking at the surrounding competition.

My current observation regarding the latest generation of fully-automated terminals with even more automation (quay cranes, OCR), as well as some new technologies (lift-AGV, battery technology, new TOS, new equipment control systems (ECS) in the Chinese terminals), is that it takes quite some time to get up to the intended productivity levels. In my view, this is a result of too many different innovations coming together without sufficient integration, and a lack of overall controllability.

Pekka Ranta (PRA): This is highly dependent on how expectations are managed. It feels that operators have the (mis)perception that automation will increase productivity significantly without any changes to existing cranes. Recent deployments have not shown great performance, though it is very early to judge.

Jan Cuppens (JC): I agree on the potential to achieve ROI and about the impact of a lot of brand new technologies coming together at once. However, this is not the only issue. One of the latest automated Chinese terminals has almost all these newest technologies on board, but the KPIs are still very promising. I believe this is because they followed the road of simplification. In the design of ‘Western’ terminals everything is over-optimised, including squeezing out equipment numbers.  

From the high-level investors’ point of view, taking into account the major up-front investment, extremely slow ramp-up to serious productivity levels (that have not yet even been reached) and enormous amount of IT people involved, we have to be very careful to simply state that the ROI is OK. LCC and TCO exercises done recently in great detail with data from live terminals suggest that caution is required, at the least.

Alex Duca (ADU): It is all about expectation management, and mainly because, industry-wise, we tend to associate the technology performance and reliability with the actual terminal operations productivity. While these are important enablers, they are not the only parameters influencing terminal productivity or ROI.

TOC: What are the most important business issues that automation should address?

TW: The only way to pay for automation is by reducing operating costs associated with expensive or low-quality labour. Yes, you can get longer operating hours and higher capacity, but automation is a very expensive way to do that, and these are insufficient by themselves to generate the necessary ROI. With the high level of investment to the ‘first lift’, commitment to automation requires ocean carrier commitment to volume and revenue over an extended period. This commitment is not available everywhere and is becoming more problematic as the liners become more powerful. 

If the terminal investor cannot be sure of the revenue, investment cannot be banked, and must then be financed by those with less of an interest in high ROI. Automation cannot address these issues – it can only be threatened by them.

YS: Terminals are built for 30 years+. If they are built in locations where volume is ‘certain’, the ROI on automation will come (eventually, sometimes slower, sometimes faster). The lines having their own terminals will make it an easier decision as volume can be ‘guaranteed’. A long-term view though is a requirement. Automating terminals is not about ROI in five years. But terminals are also not built for five years.

Another business issue is equipment inter-operability. To date all automated terminals are uniform in the sense that any fleet of equipment that is interacting is from a single vendor (AGVs, automated straddles, RMGs in a module). But in conventional terminals, there are typically a range of brands in the yard, driven by the latest tender and lowest price at the time. If automated equipment becomes interoperable, the same could play out in automated terminals. This is something that terminal owners would like to see. Otherwise, any expansion with purchase of new equipment is almost at the mercy of the OEM. This practice can already be seen with spare parts, also not to the liking of the purchasers.

PRA: I see the guaranteed stable productivity as one major issue for automation, where today’s projects have gone through learning curves over reliability and productivity. To create an attractive investment, the business case demand need to be achieved in a reasonable time after implementation (less than a year).

ADU: We need to focus on the actual scope of automation other than consequent benefits, to improve products and to simplify delivery. The scope of automation is to improve operations and service delivery on the one hand and equipment behaviour and safety on the other. The correct automation incentives are to increase production stability beyond the levels possible in current operations and to realise economy of scale and predictable quality levels.

And what should an investor expect to receive when it invests more time, more resources, more people and more money in a project? I would say, a mitigated risk and an operational terminal to match its expectations – and its customers’ expectations

TOC: How is digitalisation (IoT devices/sensors, cloud platforms) impacting the terminal automation landscape?

TW: I don’t yet see a lot of IoT networks / cloud in the terminal automation environment. Wireless communication used for many IoT instruments is too slow and fragile to support safe, robust automation. It seems that most automation is still under centralised control, rather than shifting to intelligent agents or the like. My knowledge is far from complete in this area.

YS: The amount of automated machinery at container terminals is not that large - say 100-400 pieces - and all those are known and addressable. This allows a central computer to make fast and accurate decisions without any problem. Distributed decision-making, and adding sensor technology, leads to a less predictable and more error-sensitive system, which requires constant calibration of the sensors to ensure correct decision-making. Distributed decision-making starts to make sense only when the system can no longer be overseen at central levels.

Compare it to a regular traffic junction. What would be the simplest to realise? All automated cars approaching the junction needing to ‘sense’ the situation (traffic lights, approaching traffic, etc.) or the junction management (traffic light system) telling all approaching vehicles what the situation is and what they should do? To me it’s obvious it should be the latter.

PRA: IoT is a trendy acronym re-branding something that has been in place for some time. SCADA systems have provided information from single actuators for many years. I remember in early 2000 the start-up of large pulp mill in Brazil where over 10,000 valves were connected to a data network. These valves have self-diagnostics and they report basic KPIs and unexpected behaviour over the network. In the container terminal industry there is a lot of room to expand the possibilities of self-diagnostics and forecasting. And great analytic applications do not have a value if data is not produced from the component level. My view is that IoT has opportunities to provide supporting functions but should not intervene in core operational decision processes.

JC: I agree that there has been little impact from the IoT to date. It has been very much hyped, though we are doing some POCs. It’s promising, but not yet mature. Regarding the cloud - the automation systems, TOS etc. are too critical to availability and/or latency that they can be made dependent on the last mile fibre. However, one can ask the question whether we really need the typical two data centres on a terminal to realise high availability and disaster recovery, rather than using the cloud to do this? It’s a fresh discussion, but one to be had by the IT specialists.

On decision making, we fall into the old discussion: the TOS is the logistics controller - it should PLAN and send batches of orders to the ECS which should then SCHEDULE, route and manage transfer points logistically. The equipment should execute. Many decisions can be taken at the equipment level and many MUST be taken here, simply because they are, for instance, safety-related, where sensors come into play. And if in the future we would have external trucks interacting with autonomous internal trucks, it is the sensor(s) that will have to deliver the input for the decisions.

Turning to ‘big data’: we have an enormous amount of data which is shared with our suppliers. We know exactly where we waste time (lagging). It’s a question of which supplier steps up to use these data, throw them in the hands of data scientists, analyse where the algorithm issues are and fix them. Currently, this is lacking.

ADU: Digitisation will increase overall visibility into equipment and process performance. This will become the main information platform, expanding the traditional SCADA deployments from an equipment level to a facility level and beyond. Mainly, this move the focus from assumption-based operations planning to a factual-based operations execution process.

Stay tuned for the second edition tomorrow, covering:

4. The maturity of automation technology and project execution

5. Vendors or owners – who’s driving the agenda?

6. The need for standardisation

Share your thoughts with us on social media and download the TOC Events app on Google Play or Apple stores to pose your questions to the panel for the live debate. TECH TOC is free of charge for registered visitors – click here for more details on booking options  

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