Money vs. Time

We’ve been taking American Feeder Lines (AFL) over the coals lately but it’s not because they’re promoting (so they say) short sea shipping. We’re promoting it, too – but there’s a right way and a wrong way for everything.

Earlier attempts at short sea shipping between ports in the northeast all ended in dead ends, and AFL is heading down the same cull-de-sac. Is it because they haven’t done their homework, do you suppose?

A former executive at Matson navigation once stated that the logistics of getting merchandise from one point to another boils down to a simple tradeoff: money versus time. Ocean transport, he said – which is about one-tenth the cost of truck transport – remains the cheapest transport option for intercontinental shipments.

That exec was right, and the CEO of the Alameda Corridor backed him up with numbers. For trips under 800 miles, the CEO said, “It takes $ 200 to truck a container every 20 miles, but it’s $ 450 on a train,” – so it should be around $ 20 for a 20-mile stretch of U.S. waterway, right? Small wonder, then, that so many attempts have been made to make a go of it in the northeast.

But that “money versus time tradeoff” is the bugaboo. The fly-in-the-ointment. In Europe, short sea shipping profitably moves more than 40% of all freight tonnage on that continent. In the states, we move a measly 6%. So why are Europeans making money and U.S. short sea devotees losing their shirts?

In both here and abroad, the consumer wants his goods delivered on time, at an affordable price, and with careful handling while en route. On time deliveries and careful handling are services promised by all carriers – truck, train and ship – but the development and advancement of short sea shipping on U.S. waterways has been hampered by the extra time it takes to sort and retrieve containers from undersized, conventionally-structured, container-carrying vessels. Time is money, and because such delays adversely affect the profit margin in U.S. short sea shipping operations, investment in those small, conventionally-structured vessels is discouraged.

Maybe we should feel sorry for the folks at AFL. But we don’t. We sent e-mails to the officials just to make sure they had a chance to do that “homework”, but not a single one of our messages has been acknowledged. We even told them that Boysie Bollinger’s much larger shipbuilding operation would gladly build our patented vessels for them. Still no response, yet the only chance AFL would have of raising the $ 700 million for the ten proposed 1300-TEU container ships would be to make use of our instantaneous shipboard storage and retrieval system.

Our patented vessels would make possible shuttle-style short sea operations all along the Atlantic and Gulf Coasts – not just along the restricted confines of the northeast – and this extended and rapid method of operation (time) would guarantee a generous return (money) for leery investors.