The Box - Marc Levinson [20]
Some railroads sought to take advantage of the container not simply by lowering rates, but by changing the way they charged shippers. Since the onset of federal regulation in the 1880s, the Interstate Commerce Commission (ICC) had held firm to the principle that each commodity required its own rate, which of course was subject to ICC approval. With containers, though, the railroads were not handling commodities; the size and loaded weight of the container mattered far more than the contents. For the first time, they offered purely weight-based rates: the North Shore Line, running between Chicago and Milwaukee, charged 40 cents per 100 pounds to carry a 3-ton container, but only 20 cents per 100 pounds to carry a 10-ton container, with no adjustment at all for what might be inside. After four months of hearings in 1931, the commission ruled weight-based rates illegal. Although it found the container to be “a commendable piece of equipment,” the commission said that the railroads could not charge less to carry a container than to carry the equivalent weight of the most expensive commodity inside the container. With that ruling, containers no longer made economic sense on the rails.24
Different container systems came into use on railways in other countries during the 1920s in response to a new competitive threat—the truck. Although long-distance truck transportation over primitive and often unpaved roads was impractical, trucks had obvious advantages for shorter hauls, and the railroads sought ways to reduce the truckers’ cost advantage. In Australia, the Sunshine Biscuit Company used containers plastered with its advertising to ship its treats on open railcars with sides of wooden slats. The London, Midland, and Scottish Railway carried three thousand containers in 1927, and the French national railway promoted them as an efficient way for farmers to ship meat and cheese to the city. In 1933, it joined other railroads to form the International Container Bureau, an organization dedicated to making international container freight practical in Europe. Several U.S. and Canadian coastal ship lines tried carrying containers and truck trailers in the early 1930s, and Grace Line built wooden vans with metal reinforcing to cut pilferage of shipments between New York and Venezuela. The Central of Georgia Railroad formed Ocean Shipping Company to move loaded railroad cars between Savannah and New York—an idea that allowed the Central of Georgia to keep control of its freight, rather than handing it off to another railroad.25
Experimentation began anew after the war. Amphibious landing ships were recycled as “roll on-roll off” vessels to transport trucks along the coast, improving upon techniques originally developed to land troops and tanks in over-the-beach invasions. The International Container Bureau was reestablished in 1948, and the U.S. military began using small steel containers, called Conex boxes, for soldiers’ personal belongings. The first ships designed for containers arrived in 1951 when Denmark’s United Shipping Company opened a container service to move beer and foodstuffs among Danish ports. Dravo Corporation of Pittsburgh created the Transportainer, a steel box seven feet nine inches long, and more than three thousand were in use around the world by 1954. The Missouri Pacific Railway promoted its “speedboxes,” aluminum containers on wheels, in 1951, and the Alaska Steamship Company began carrying both wood and steel containers from Seattle to Alaskan ports in 1953. Seatrain Lines, a ship line, approached containerization a different way, hoisting entire railcars on board ships and sailing them from U.S. ports to Cuba. All of these undertakings were modest in scope, but all had the same aim: to cut the cost of moving cargo through slow and inefficient ports.26
Yet these efforts were far from successful. “Contrary to what had been thought at first, the handling of containers led to hardly any cost savings,” an influential European maritime expert admitted. A 1955 census