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Abstract
Cooperation and outsourcing among providers in the air cargo industry has received serious attention, with the hope that this would reduce providers operating costs. Due to the increasing costs of developing new service products and improving service quality, partnership formation is an important way to achieve business excellence for providers. Furthermore, shippers prefer to use service providers, which can handle all aspects of transportation. This situation forces service providers to forge partnerships with each other in order to create a complete service chain.
The aim of this thesis is to study the choice behaviour in the vertical and horizontal partnerships in the emerging airfreight business structure. Discrete choice analysis is utilised to establish the factors that affect shippers and providers partner choice and to quantify the importance of these factors in partnership formation choices. The proposed choice models were constructed by SP data obtained from the Korean air cargo market. This thesis also studied different sectors and industries in order to capture any previously unobserved differences between the sectors. Furthermore, the attributes of WTP and WTA were analysed as possible service quality attributes which can be used for future service product improvement. This study also simulated how new products being offered in the market could cause changes.
Results showed that the price and delivery time attributes of cargo are the most significant factors, whereas the risk of damage and loss attribute is the least significant factors for shippers choice behaviour. In regards to the providers choice behaviour, reducing time and consolidation are among the most significant factors that may influence choices for partner formation. In addition, the results from WTP and WTA suggested that service providers should focus on increasing service levels for handling capacity and loyalty benefits to improve vertical partnership. In the case of improving horizontal partnerships, service providers should focus on value-added services, such as consolidation. Lastly, the results from simulations showed that not only will a service provider lose market share when a competitor offers a new product, but also that the market share loss will be larger when its own service products can be substituted by competitor s new offer.