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Janus comments

The gap in belief

GOOD REPORTS have been received from specialist operators who have provided the raw material for interfirm comparisons. There ought to be no lack of volunteers for the exercise on a wider front which is now being undertaken by the Road Haulage Association. They alone will be able to check their own results with those of other hauliers doing similar work.

Operators in general should welcome the scheme partly perhaps because it seems to them that no particular effort, even of comprehension, is required on their part. They have become more than a little tired of the rapid succession of plans for vehicle testing, plating, staff training and education, operators' licences and special authorizations, all demanding action and often considerable expenditure.

It may be their hope that in due course they will have presented to them a formula which they can use for the purpose of negotiating rates increases without the danger of condemnation by the Prices and Incomes Board or some other official body. It is the credibility gap they are most anxious to close. They do not care what method is used so long as it is successful.

In rate negotiations, hauliers have found, it is not so much what is true as what customers are prepared to believe or accept. The old system of a general recommendation following a session of the RHA rates committee was prized by members to the extent that it worked and not to the extent that it reflected the cost increases of individual operators.

Depressing effect

Many customers, although by no means all, were prepared to accept the recommendation at least as a basis for discussion. In making the initial approach hauliers relied on the periodical announcement as an essential support.

_ Condemnation by the Prices and Incomes Board had a depressing effect on operators and perhaps also on their rates. The situation has improved partly as a result of carefully worded letters sent out by the RHA. The uneasy feeling has remained that at any moment the Board might say again that the spirit if not the letter of its interdiction has been infringed.

From this point of view the latest move might be regarded as an attempt to get so far ahead that the Board would never be likely to catch up. In the April 1966 report the Board expressed the opinion that "publication of information about average costs over the industry as a whole may be as unhelpful for the individual firm" as the blanket recommendations which had been firmly ruled out in the interim report 10 months earlier.

On the other hand the Board saw value in "the publication of information about costs in relation to particular activities and about the spread of costs between different firms in the same field". It is very much on these lines that the new inquiry will be conducted.

The Board had tried its prentice hand and burned its fingers. It had asked 330 hauliers for information designed to show the relationship between the movements in total costs and rates. Only 38 replies had been submitted "in sufficient detail for close analysis". On such evidence, said the Board, firm conclusions were clearly impossible.

A much better response was made to the questionnaire the results of which were published in March last as a supplement to the report of November 1967. The inquiry, however, was limited to earnings and hours of work. On the subject of a rates increase the Board decided for various reasons to make no recommendation. It suggested instead that "in general a haulier would be justified in negotiating higher rates to take account of actual increases in costs which he has not reasonably been able to absorb".

The task which the RHA has subsequently set itself is to give members guidance on rates within the limits set by the Board. Indices claiming to be valid for rates throughout the road transport industry are bound to be ruled out. The only possible alternative is to take the industry section by section and see what statistics come to the surface.

If the job is to be done properly, it is thought, there must a long incubation period. The intention is to spread the work over five years, thus providing a subtle comment on the almost indecent haste with which the Board set out to sound the depths of road haulage costs in a few short months.

Temptation

There must be a temptation for the new inquiry to surface from time to time and pronounce on the current situation. Road haulage costs will not remain static and there will be inevitable demands for assistance in putting a convincing case for a rates increase. It remains to be seen whether in the interim more traditional methods will be used to meet the need.

What has never been properly considered is the actual difference in the results produced by rule of thumb and by more scientific means. It is supposed that the whole purpose of the elaborate official apparatus of which the Prices and Incomes Board forms a part is to keep prices down. In some industrias this has clearly been achieved in that the producers have asked for a certain increase and the Board have awarded them less or none at all.

No similarly exact picture can be drawn for road haulage. The three separate recommendations by the RHA which started all the trouble added up to 13 per cent. The Board considered that on the whole this might have represented the approximate increase in actual costs for the average haulier if such a person existed. But, the Board continued, it left out of account increases in productivity and the scope for further increases.

Having ruled out in advance any general recommendation, the Board did not put forward an alternative figure lower than the 13 per cent. It was compelled to admit that some increase in road haulage rates was justified. The impression left was that the hauliers had been worsted and could now expect only a much smaller increase than they had sought.

This could well not be true. Few hauliers, if any, had consistently been able to follow the RHA recommendations at any rate for all their traffic. They cannot have been greatly worried because the Board had ruled that they were not entitled to the full 13 per cent. No doubt they represented their subsequent request for a more modest increase as a concession.

Firm basis

The RHA recommendations were not conjured out of the air. There was invariably a firm basis of specific cost increases, more often than not in taxation or in wages. If the assessment erred it might well have been on the moderate side because sufficient weight had not been given to the rising costs of certain items usually aggregated as overheads.

The more cost-conscious an operator becomes, it may be argued, the more likely is he to recognize every opportunity for putting up his charges. The Centre for Interfirm Comparison will in no way be trying to establish the largest possible increase in costs. The mere fact that its investigation will be more sophisticated and exact may mean that it produces evidence of the need for a higher increase in rates than the individual haulier would be able to prove with his own unaided and relatively crude methods.

Whether this happens or not the results so painstakingly reached at the end of the new inquiry—and this will apply also to any interim reports that may be issued—will be received with much greater deference than pronouncements by individual operators or by the RHA or even—dare one say?—by the Prices and Incomes Board. The credibility gap will be virtually closed and will remain so even in the unlikely event that the Board criticizes the findings.

Much can happen over the next five years. The system of operators' licences proposed in the Transport Bill, by removing the legal distinction between road haulage and operation on own account, may cause the trader to look with a fresh eye on his transport costs. The emphasis on higher standards of operation may also influence him although in a different way. Decisions on applications for special authorizations, one suspects, will frequently be taken largely on the basis of comparative road and rail costs.

NOW that container movement by road is becoming more widespread, the number of road hauliers carrying the "big boxes" on unsuitable vehicles is falling.

However, far too many ISO containers_ are still carried on rigid or articulated vehicles with nothing more substantial than old rope between the driver and disaster. I shall be surprised if before long there is not an absolute ban on the carriage of ISO 20, 30 and 40ft containers on vehicles which are not equipped with approved restraint fittings locating in the corner castings of the boxes. Now that special purpose skeletal trailers or dual-purpose trailers with twistlocks are available container service operators are likely to look with increasing disfavour on road hauliers operating unsuitable equipment.

It would be interesting to be able to point to a noticeable trend in container handling equipment for depot or terminal use. There is abundant equipment on the market, of the most diverse nature, and varying in cost from a few hundred to many thousand pounds. With the inevitable expansion of containerization in the next few years the equipment manufacturers whose products coincide with popular demand may be able to exploit a gold-mine.

For this reason, I would expect new handling systems to be introduced to the market quite frequently. Any ingenious mechanic with a Meccano set can readily devise a comparatively new system for lifting a container from a vehicle platform to the ground, or between road and rail vehicles, or from a lorry to a loading bank or conveyor. But there is no foolproof way to introduce a new design to a suspicious and coldly practical world. The brainwave must be created, advertised, marketed and sold

—in sufficient numbers to establish a durable trend.

The technical problem would be less difficult if the present form of container ship and container handling at ports was likely to last for as long as a decade. The shipping consortia and port authorities whose enterprise has launched the container revolution will be disappointed if the pattern is not relatively durable. but the second generation container ships and their handling facilities may bear little resemblance to the equipment now available, or under construction.

The attraction of the roll-on/roll-off principle—with all that it implies in relation to the carriage of unitized loads which may not be containerized at all—is not likely to diminish. Any system which minimizes port installation costs and which is able to match the productivity of the costly gantry crane equipment for turning round container ships will attract many supporters, not least from the road haulage industry. Particularly is this likely if dockworkers here, or abroad, exhibit their customary intransigence at the introduction of container berths. Of this, alas, there is every sign.

Exciting idea One exciting idea—technically possible today but perhaps more probable in 1980—is for lorries to drive into any deck of a ship, even below water, via a floating dock. The dock would be fitted with a circular ramp, rather like the familiar multi-storey car-park, and lorries would circulate round the ramp until the appropriate deck level was reached. Access to the underwater decks would be via a collapsible tube, fitted with water-tight doors, and the system involves complicated and doubtless expensive air-exhaustion equipment. I men

tion it as one of the many alternatives to the first generation container handling equipment, because the powerful bandwagon promoting containerization includes divergent views.

On the one hand there is a natural desire to obtain a satisfactory financial return from the vast investments in terminal equipment, and the associated cellular container ships. On the other, a highly competitive environment, with far too many competing services across the principal ocean trade routes will almost certainly encourage radical innovation, especially on balanced trading routes operating between well-organized ports, of which Felixstowe is a prime example.

Reinforcing my argument, an Akan advertisement feature in The Times (July 12) illustrates a container ship offloading into special-purpose cargo hovercraft for inland distribution. The author skates over the formidable problem of providing special tracks to the inland terminals and road hauliers need not lose any sleep over this idea blossoming in the next five years; but penetration along estuaries to waterside terminals could be a competitive factor.

Because of the fragmented nature of the road haulage industry the vast majority of small hauliers are unlikely to have the resources to equip themselves with sophisticated container-handling facilities. The simple types of fixed or mobile gantry cranes are perhaps within their reach but the special-purpose equipment—straddle carriers, side-loaders, etc, could only be justified if suitable premises are available and the use made by the expensive equipment could be justified.

Everything that is happening in relation to container transport points to the wisdom of co-operative group working. This is de

veloping in Europe and the Tipper groups which have developed here in recent years in response to rate pressures suggest that it is not Utopian to envisage an extension of the principle. If consortia of 20 to 50 road transport firms in areas likely to generate sufficient container traffic pooled their resources to establish a co-operative terminal, with shared maintenance facilities, common office services, and communications links with the main inland container depots and, of course, the principal ports, containerization would really get off the ground.

The idea of co-operative terminals has been mooted before but quite apart from the value of a properly equipped terminal to the operators and to their customers it would be in line with the current thinking on urban development. In Birmingham, and many other cities, the local authorities would be thankful to disperse the premises of small hauliers to peripheral sites away from city centres.

I know of recently extended town transport depots which are living on borrowed time—it is only a matter of a few years before transport operations within earshot of residential property will be vigorously opposed_ Hence the wisdom of solving two pressing problems at one move.

The makers of container handling equipment would welcome co-operative terminals —always provided that the controlling organizations were financially stable. The problem of selection of appropriate equipment would still remain and it would be extremely helpful to the road transport industry and, indeed, to industry as a whole, if an equipment evaluation centre could be established. Perhaps the Road Transport Industry Training Board will be able to promote this idea, for it can scarcely ignore the specialized container handling vehicles now available.

The most successful road haulage operators in recent years have prospered because they have identified themselves with the transport problems of their customers. This trend will undoubtedly continue, for though the larger manufacturers generally employ well-qualified transport managers, a wide range of British industry looks to the road haulage contractors for practical advice. For this reason forward-looking hauliers are studying container-packing methods.

The "stuffing and un-stuffing" of containers will have to be faced by every large exporting organization and by many smaller ones. Although the container consortia have for some time been advising their shipper customers on the best techniques to use for an intermodal journey involving a lengthy voyage, there can be little doubt that many dispatch and warehouse staff are completely in the dark. I was interested to learn from one export packer recently the length of time necessary to train an intelligent and keen young man to pack goods for exports. This firm, internationally famous, believes that a trainee packer is becoming quite useful after 18 months.

Outside the furniture removing section of the industry, relatively few people in road haulage could claim much expertise in container packing. It is easy to say that road transport's job should concern movement only but it seems much more probable that the road transport organization with an adaptable team of drivers /packers could carry out contract packing and haulage of containers. I suspect that the large shipping consortia who are promoting containerization would be much happier if the road transport industry could undertake or at least partially supervise the crucial responsibility of container packing.

In considering the purchase of container-handling equipment the intensity of use to be made of it must be forecast. The haulier who sees the need for equipment to offload or transfer between vehicles three or four containers daily may be well served by a simple gantry crane. The conventional British Standard classification of crane ratings is relevant as a guide to the purchase of other equipment. Light duty container handling cranes, Class 1, are reckoned to be used for 1,000 hours per year. Class 2, medium-duty, for 2,000 hours, Class 3, he,ivy-duty—such as the Morris cranes supplied to BR for Freightliner work, 3,000 hours—and Class 4, for extra heavy-duty, for use over 3,000 hours per year, continuous.

The Morris Freightliner equipment for Class 3 duties is able to transfer 350 containers in one day. I doubt if operations of this intensity will be widespread in road transport terminals for some years, if ever, but it would certainly pay any substantial firm, or co-operative terminal of the kind suggested above, to invest in equipment offering a substantial margin for the growth in container movement that may be expected.

One other piece of advice will certainly be sought of hauliers.

When a manufacturer has been converted or persuaded to dispatch goods in containers the reverse process will occur with imported raw materials. Road hauliers may be asked for advice on the internal movement within factories of containers. Some manufacturers have already indicated that they see an advantage in going over zo containers if the "box" can be moved round the works at floor level, collecting its load as it proceeds round the factory. Equipment which makes this possible is becoming available and road hauliers may be able to suggest appropriate wheeled corner fitments.

If "co-operative" road transport terminals are in fact established, as is recommended, a useful sideline would be the supply of powered mechanical-handling equipment to the hauliers' customers. This would provide a source of revenue, and would ensure that the equipment in use in local factories was compatible with that used by the co-operative.