RAILWAYS AND MOTOR TRANSPORT.
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Should the Railway Companies' Powers in Respect of Road Haulage be Limited ?
WE REFERRED briefly • last week to the fact that an official decision is to be reached in the near future on the question of the continued limitation of the powers of railway companies to carry goods by road. The main point at issue is whether the railway company should be subject to no restrictions at all or 'whether it should only be permitted to haul, on the road, goods which are to be, or have been, for some part of their journey railborne on the company's system. A subsidiary question is whether, if it be agreed that unlimited power is undesirable, there should be somelimit imposed on the distance over which the railways may haul_ by road goods for shipment at, or delivery from, the railway. The whole matter is not the simple question that it appears at first sight. One's first inclination. is, perhaps, to jump to the conclusion that the fewer restrictions are imposed on any body, the better for the efficiency and economy of our national transport. This might be the view of the-trad.er who has goods to be transported. Similarly, the first impression of the motor manufacturer might be that the removal of restrictions would mean big orders for vehicles to be placed by the railways and would, therefore, be entirely to his advantage.
A little thought will, however, serve to east a new light on the problem, and it will be well to consider the pros and cens in game detail.
As the Railways Present the Case.
First, let us take the arguments in favour of unrestricted powers. These are substantially as follow :— (1) Unrestricted powers in respect of road haulage are already possessed by motor carriers and others. It is unreasonable that the efficient working of the railways, as the greatest transport undertakings in the country, should be hampered by imposing upon the companies restrictions which do not apply to their competitors. .
(2) Were the railways to be given unrestricted powers, they would be able to develop a. complete and co-ordinated system of rail and road transport to the benefit. of the trading community as a whole.
(3) The railway companies, being large corporaare in a position to buy and to operate under the most economical conditions, and may, therefore, be expected to be, able to conduct haulage by road on terms more favourable to traders than those that can possibly be offered by other undertakings. (4) The large scale development of road haulage by the railways would mean the placing of large orders for motor vehicles at a time when, in view of trade. depression, such orders would be particularly valuable to the industry.
(5) The railways, being immense uAers of coal and occupying a position which enables them to obtain coal supplies on the most favourable terms, are espeeially.well circumstanced for the economical operation of steam and electric road vehicles. The extensjve use of-such vehicles would re-act upon the situation as regards liquid fuels, tending to alter the balance of the supply of; and demand for, petrol, in a direction that might be'expected to lead to a reduction in the price of petrol, beneficial to motor users as a whole.
(6) The extensive ernployMent of steam and electric vehicles would imply dependence on home-produced fuels, and the elimination of such risks as may accompany any system involving dependence on imported fuels. (1) The competition of the railways in direct road haulage would tend towards reduction in rates for such haulage, which would be beneficial to the trading community. e6 Now, let us consider te what extent these arguments hold, water when we come to analyse the proable results of granting the unlimited powers suggested.
The Other Sideof the Picture.
(I) While it is true that the road-carrying competitors of the railways have certain advantages in competition with respect of road haulage, it Li. also true that the railways' possess advantages in the nature of a monopoly in. respect of rail haulage. These latter advantages are se great as to ensure a huge volume of traffic for the railways and the existence of large organizations which, if given unrestricted powers 'in other directions also, -would, undoubtedly, be capable of stamping out competition. Were this to happen, we should have a single transport monopoly for rail and road, and there would be no natural competition between the two systems. The reply to the argument of the railways is, in short, that those_ who have been given special privileges by Act of Parliament, clannat complain if 'certain other and lesser privileges, permitted to their competitors, are not permitted to them. '(2) Admittedly, if the railways were given warestrictecl powers, their ability to create a fully coordinated and complete system of road and rail traffic would be assured. It does not follow, however, that they would utilize their strong position in such a way as to secure this end. History 'appears to indicate that, at any rate in certain cases, when the railways got control of essential portions of the canal system, they did not utilize their position for the. purpose of co-ordinating the two systems, but rather for tile purpose of breaking up the canal system and forcing on to the railways the bulk of the traffic that might advantageously have been carried by water. It does not seem possible to provide adequate safeguards against the adoption (If -a shnilar policy in respect of road transport. Thus, the result might be, not a eo-ordination of two systems, but the suppression of the one to the benefit of the other, but to the disadvantage -of the public.
Squeezing-out Tactics Become 'Possible.
(3) The fact' that the railway companies, owing to their size, are in a position to buy and operate cheaply, would, in itself, give them an advantage in free competition with smaller road-carrying concerns. In. the first instance, their ability to effect economies would, no doubt, be reflected' in the rate.s at which they-would convey goads direct by road. By cutting these rates so as to accept a negligible or no profit for a, time, the railways would compel competing road carriers either to work at a loss for are indeiluite period, or drop out of the business.. Sooner or later the latter course would be inevitable. One this result had been secured, the railways would, no doubt, adopt one .or other of two alternatives. On the One hand, in the absence of effective competition on the roads, they might raise their rates; or, if their rates could be regulated, their charges for incidental services in connection with loading and unloading, for time wasted at terminal points, and so 'on. might be so far increased as to constitute an unduly heavy burden on traders who for special reasons might prefer road to rail haulage. On the other hand, and more probably, when competition had been extinguished, the railways would remove or reduce their own road services, practically compelling traders to have their goods rail-borne, and employing their motors solely or mainly for their present purpose, Le., the collection or delivery of
goods carried for the greater part of the journey by rail.
(4) While an enlargement of the privileges of the railways might lead to some immediate orders to the motor industry, it is practically certain that in the long run the industry would suffer, the railways setting up their own manufacturing establishments singly or jointly. The vehicles manufactured by them would be specifically of the type preferred for the railway services. Thus, the manufacture of types of general utility would be reduced, and the existing manufacturers, with more limited markets, would find it still more difficult to produce at a price enabling them to succeed in obtaining Overseas trade.
(5) her services within a limited radius, the railways would, no doubt, make extensive use of electrically-propelled vehicles. For longer services they would, no doubt, favour vehicles using coal or coke as a fuel. While these tendencies might have some effect in the direction of conserving petrol' supplies, their consequence would be to limit the civilian use of the types of vehicle found suitable for military service. Were the railways to become something approaching monopolists .in the conduct of heavy road haulage, the military requirements of the nation would no longer be filled by any subvention, or commandeering scheme. The country would be put to a great expense owing to the necessity for the War Department to own and maintain a very large fleet of petrol vehicles. The difficulty might be overcome by a provision making it compulsory for the railways to compose, say, 50 per cent. of their fleets of vehicles eligible 'fOr subvention under the War Department's scheme. Even so, however, grave difficulties would arise at the outbreak of war. The road and rail services of the railways would probably by that time be interdependent to such a, degree that the coinma,ndeering of the road vehicles would mean the dislocation-of the whole of the internal traffic of the country.
' (8) From a military standpoint, there is no advantage in becoming independent of imported fuel supplies if, in so doing, we become possessed only of vehicles of types proved unsuitable or even useless in military service.
(7) This point has already beep .covered, but it should be noted that even if a reduction of rates were rendered permanent by safeguards which would be very difficult to devise, the trader might still suffer from lack of facilities or from inadequacy of service. In many cases, preference for road haulage is not based on a direct comparison of rates, but rather upon the saving of time that can be effected, the smaller depreciation or damage resulting from the elimination of handlings en route, and the smaller cost of packing similarly rendered possible, owing to the fact that there are no transhipments during the journey. Thus the over of a cheaper service would not necessarily appeal to the trader if, as is probable, the' utilization of that service entailed delays in departure or intermediate handlings at railway depots. In addition to the points which we have dealt with from both sides, there is yet one other matter to he considered which is, in ow opinion, sufficiently important in itself to form the basis of a 4finite decision. It must be admitted that if the railways were given unrestricted powers for road haulage, it is at least probable that they would, in ,course of time, become the owners of the great majority of the heavy transport vehicles in the country. • Their employees working these vehicles would be closely associated with the men on the railways themselves. In, the event of industrial dispute, the two groups would operate as one. On the occasion of the national railway strike, the country was for the time dependent on motor vehicles for its foodstuffs. Were the vehicles owned by the railways and manned by the railways' employees, no such safeguard would be in existence, and the power of a single group of workers to paralyse the entire community would be increased to a most undesirable extent.
The importance of an independent transport system for use in such emergencies cannot be over-estimated, and it is clearly desirable thatthe bulk of the units of that system should be vehicles, the mechanism and control of which are understood by motor drivers of all grades. Thus, on the whole, we are forced to the conclusion that it is undesirable that the railway companies 'should be permitted to run road services other than for the collection and delivery of rail-borne goods. There seem to be no equally strong reasons why, subject to this condition, there should be any serious limitation on the distances over which goods might be road-borne in railway vehicles, either for collection to, or delivery from, railway depots.