Profit vs. Risks: The Mechanisms Behind Paralysis Risks and Core Impacts of Highly Automated Ports

Chennuo Wan; Zhenxi Chen; Zihe Chen

doi:10.63313/EBM.9201

Authors

Chennuo Wan Hangzhou Foreign Languages School Cambridge A-Level Center, Hangzhou, China Author
Zhenxi Chen High School Affiliated to Shanghai Jiaotong University IB Centre, Shanghai, China Author
Zihe Chen High School Affiliated to Shanghai Jiaotong University IB Centre, Shanghai, China Author

DOI:

https://doi.org/10.63313/EBM.9201

Keywords:

Highly Automated Ports, Paralysis Risks, Profit Maximization, DP World, Cyber-Attack, Implicit Costs, Operational Risk Management

Abstract

This paper takes DP World as an example to analyze the paralysis risks, their mechanisms, and core impacts that highly automated ports face in the pursuit of profit maximization, and proposes corresponding strategies at the institutional and national levels. Under the assumption of profit maximization, private ports overly emphasize the reduction of explicit costs and promote the economies of scale brought about by automation, while underestimating implicit costs and related risks. As shown by the case analysis of DP World, its profit-driven promotion of automation ultimately led to losses during a cyberattack. The proposed suggestions at the institutional and national levels can effectively balance automation efficiency and operational risks. However, this study has limitations. The framework is only applicable to private ports and does not consider the impacts of government-led ports and differences in regional economic development levels on the automation effects and reasonable levels.

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