U.S.A. to Inquire into Haulage Rates
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QHOULD road haulage rates be based on the cost of service alone, or should some regard be had to the value of the commodities carried? Both systems are in force in the United States and two comprehensive investigations into them are now pending.
In America, operators who work entirely within the boundaries of a State are controlled by the , State authority. All States levy highway taxes and some exact carriers' fees, often heavy, which may depend upon the weight of cargo and length of haul, on the type of vehicle or on the financial results of the carrier's business.
Anomalies In Regulations Regulations governing vehicle sizes vary prodigously from one State to another. In Kentucky and Tennessee, the limit is about 20,000 lb. gross weight, whereas in Rhode Island, Nevada and the District of Columbia, vehicles weighing up to 120,000 lb. gross are allowed. Many States require common carriers to publish rates classifications; a few authorize their commissions to determine rates, although these powers are seldom used.
On the other hand, inter-state operators are controlled by the Interstate Commerce Commission, whose authority is backed by the Federal Motor Carriers Act, 1935. The Commission regulates all inland transport agencies, except civil aviation. Under the Act, common carriers of goods and passengers on inter-state routes are subject to licensing, although apparently of a less onerous nature than that iti force in Great Britain. All rates have to be published and uneconomic competition is restricted.
"Unjust discriminations" and "unfair or destructive competitive practices" are forbidden by Congress.
Within an area stretching from New York State in the East and North, to the Mississippi River in the West, and Tennessee and North Carolina in the South—the largest industrial market of the United States—road transport rates follow railway practice of charging what the traffic will bear and have been fixed by discussion between operators. Rates are often higher than the cost of service would justify.
In New England, on the other hand, road transport charges are based on the cost of operation, using the 10-ton vehicle as a yardstick. "class rates" are intended to yield a profit of 10 per cent.
Only a small proportion of road and railway traffic is, however, carried at class rates. The greatest share of traffic is conveyed at "commodity rates," which appear to be the equivalent of the exceptional rates charged by the British railways.
During the war, road operators were allowed to raise their minimum rates. It now appears that class and commodity rates for road transport generally exceed the corresponding railway charges by about 5 per cent., at least for the distances in which road operators can normally compete.
These and other facts were contained in a most comprehensive paper on "The Regulation of Goods Motor Transport by the Federal Government in the United States," which Mr. Gilbert Walker, D. Litt., M.A., read to the Institute of Transport, last week. Mr. Walker said that the United States railways, unlike the British, are principally organized for traffic in very large loads of 20-30 tons at a time, and for exceptionally long hauls. Less than 10 per cent. of the traffic in manufactured goods is in smaller consignments.
"One effect of these differences," Mr. Walker surmised, "may have been to confine motor carrier competition in the United States by length of haul, rather than by class of merchandise, as in the United Kingdom."
• Influence of Distance Hauliers in trunk-line territory found it unprofitable to transport low-rated commodities "at dais rates beyond certain distances. In New England, it was reported that as distances increased beyond 50 miles, railway competition became more important. On extremely long hauls, the cost of road transport put competition with the railways out of the question.
As in the United Kingdom, American hauliers generally operate regularly only between busy areas where return loads are available. Where there is little likelihood of a return load, a charge equal to the cost of running out and home is normally made.
The Interstate Commerce Commission has found that in many instances the class rates to certain destinations arc much less than those to intermediate points on the same route, and undue preference is being given to larger cities, to the disadvantage of smaller communities. To remedy this state of affairs, it has been recommended that class rates should be determined according to a simple distance scale, calculated with relation to average load factors and length of haul, computed as the shortest distance over hard roads between the base points served