IWT : Total Cost of Ownership

Total Cost of Ownership ( TCO ) is a comprehensive financial assessment that

considers all expenses for a product or service over its entire lifecycle . This

includes not only the initial capital expenditure , but also expenses during

operations , for maintenance and upgrades , as well as training and disposal

expenses . Unit costs harmonised based on total amount of output of the asset

over its lifecycle , allow for fair comparison of different products or services .

We used a TCO model to compare IWT with road freight ( RFT ) based on

standardized technical and operational constants . In urban operations , road

freight has lower TCO compared to IWT , though IWT can become competitive

in contexts where congestion reduces the efficiency of truck operations . We

found that battery - swapping technology significantly improves the

competitiveness of electric vessels for long - distance operations . Integrated

IWT - RFT strategies should be designed according to their respective logistics

processes to ensure that both modes perform near optimal logistics efficiency

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TCO for integrated IWT and RFT

services . Finding the optimal split

between the transport modes at

the intersection of the respective

TCO curves . Source : KLU

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