This is a story about the only bridge in the world that connects two bodies of water separated by 3,000 miles of land.
The "landbridge" is five years old, and probably the most creative marketing venture in the freight transportation area in decades.
Like many other bridges, the landbridge is made of steel, concrete and wood. It connects West Coast ports such as Portland, Los Angeles and Oakland to eastern cities such as Boston, New York and Baltimore and Gulf Coast port cities such as New Orleans. But the term "landbridge" really exists only in the minds of certain marketing executives. To everyone else, it is known as the railroad.
Since 1972, ocean shippers and the railroads have combined to alter the freight shipping industry significantly. Landbridge is a new concept that involves transporting mostly containerized cargo by ship from the Orient to the West Coast of the U.S., then across the U.S. by rail to an eastern port, and finally by ship again to Europe. The cargo also travels in the other direction.
What the shipping companies have eliminated in many cases are trips through the Panama Canal - an area of questionable stability to many - or even though the Suez Canal.
And the water and land carriers have found that the landbridge can cut several days from the usual trip time - thus pleasing the companies shipping the goods. Besides, there is no additional cost to the concern sending or receiving the goods involved because the single intermodal fare is set by the steamship company, which in turn negotiates how much of that total will go to the rail carrier.
Landbridge has two close relatives: "minibridge" and "micribridge." But all are variations on the same theme: Traffic moves in sealed marine containers, on a single bill of lading, at a combined rail-water rate scale that is competitive with all-water rates.
Minibridge involves containerized shipments originating at a U.S. port city on one coast, but shipped by rail across the country to another port city and eventually by steamship company across one ocean or the other. This, too, can be reversed, with a shipment coming from the overseas unloaded at a port on one coast and shipped by rail to a port on the other coast that is the final destination.
Microbridge the newest of the railbridge operations is an abbreviated minibridge. It involves shipments that either originate or terminate at inland U.S. points such as Chicago, and are linked by rail to a port city and boat to an overseas location.
Some port and labor interests along the East Coast had challenged the right of shippers to set minibridge and microbridge intermodal fares in actions filed with the Federal Maritime Commission. but only last week the FMC upheld the fares as acceptable despite a challenge from several port and labor groupscomplaining that the intermodal fare structures were unreasonably low, causing them to lose business.
The East Coast ports feel they will be the worst hit by the astronomical growth in these markets because most of the traffic involved is coming from the Far East, and now is being inloaded on West Coast ports for shipment to cities all over the East.
According to Thomas Fante, assistance vice president for intermodal traffic for Southern Pacific Railroad, "In the five years that have elapsed since "railbridge" (the umbrella term for all three kinds of bridges operations) services were introduced, the flow of internationalized containerized freight over U.S. rails has increased by approximately 350 percent, contributing to new all-time records in carloadings and revenue for piggy-back operations" (putting a truck trailor or marine container on a rail car).
Fante said the bridge business "is all new (to the railroads) and . . . its potential is still largely untapped. Questions about the Panama Canal, its future stability and potential vessel delays, and expected big increases in toll charges all effect steamship operators' thinking about minibridge routes," Fante says.
Though the idea was first pushed by the steamshippers, the railroads appear to be an even bigger winner. Last year, for example, overall piggyback and container loadings on U.S. railroads (which covers virtually all bridge shipments) exceeded 1.6 million, up 15 percent over the year before. Revenue were up even more - 19 percent - and went over the $1 billion mark for the first time in history.
In this West Coast port city, for example, the Union Pacific Railroad dock facility used to handle about 16,000 Toyotas a year, which then were shipped primarily by truck to Toyota dealers in the Northwest. Now, according to dock supervisor Bill Harris, "We unload that many on a good month."
And the Toyotas unloaded from huge ships (3,500 per freighter) here go directly onto special double-decker and triple-decker railcars on tracks that lead right to the dock. From Portland, the cars now are shipped on Union Pacific trains as far east as Chicago and Cincinnati, with five sales regions now served from Portland instead of the original one. And cars that used to be shipped direct to New Orleans, for example, now unload in the West.
The Interstate Commerce Commission, which regulates ground transportation shipping rates, has taken a favorable view toward intermodal transportation. "We are not going to promote it, but we are also not going to hinder the growth of it," said Neil Llewellyn, an ICC intermodal expert.
He points out that as much as 5 or 6 days can be cut from the usual average 21-day shipment time from an eastern U.S. port to the Far East by using the minibridge. The trip across country by train, for example, takes only 3 or 4 days. "That's an important saving to be realized," Llewellyn said, "particularly when you have to account for inventory costs of holding onto goods for extra time."
He adds that there are losers, because "all this is a reallocation of resources to be used more efficiently. In a case like that, someone always has to come up short.
But there are winners, too. Seatrain Lines Inc., one of the larger and more progressive ocean shipping companies, first pioneered the landbridge concept five years ago. Since that time, Seatrain's container services have provided a rapidly increasing percentage of water transportation revenues for the huge company. In 1973, for example, container services accounted for 68 percent of water services revenues. This year, that number is 87 percent.
And despite heavier competition, Seatrain considers landbridge business "a major growth opportunity," particularly in the shipment of agricultural commodities.
Southern Pacific Railroad is so confident about growth in the intermodal containerized shipping areas that it is spending $10 million to construct new intermodal facilities in several cities, and has committed considerable resources to experimental designs of double-decker container cars that can carry two large containers stacked upon each other.
SP spokesman Andy Anderson said SP has been testing a prototype of a car since last fall that carries two 40-foot shipping containers stacked. The cars are lighter and shorter than regular flatcars, and new design reduces the weight of the equipment needed to handle containers by "as much as 45 percent," according to Anderson.