(2) Voyage Patterns.-In 1969, the Ponce De Leon made 43 voyages to and from Puerto Rico, averaging approximately 60 hours to San Juan.60 It is estimated that the fully loaded vessel can discharge and load in less than 12 hours, enabling the Ponce De Leon to make its roundtrip in 6 days. TTT has proposed that shippers owning their own trailers who wish to ship in their own units employ this service. This would be particularly attractive to shippers of such products as chemicals, alcohols, etc. who employ specialized tank trailers for handling their products and volume-type shippers. Because this carrier entered the trade in mid-1968, its traffic amounted to 123,932 tons, 102,606 of which moved southbound.

eo Leaving New York on Friday, the vessel arrives and delivers the cargo on the next working day-Monday.

d. Motorships of Puerto Rico, Inc.

Motorships was the smallest and also the most specialized of these carriers. This carrier primarily transported automobiles. Although Motorships is currently inactive due to the recent disposal of the SS Puerto Rico and subsequent problems in placing the SS Fortaleza in continuous service, this carrier may resume regular operations; 61 and, for this reason, its composition and operations are discussed in this section. In 1967, motorships operated between New York City, on the one hand, and San Juan and Ponce, on the other. Its New York terminal was shed 292, berth 9,

61 Letter of Nils O. Seim, Motorships of Puerto Rico, Inc., October 10, 1968 to Leroy F. Fuller, Director, Bureau of Domestic Regulation, FMC.

Port Newark, N.J. The San Juan terminal was pier 10; and at Ponce, pier 4.62

(1) Vessels.-Motorships owned one vessel outright (the SS Puerto Rico, which was disposed of) and chartered another, as needed, from a wholly-owned subsidiary company, Motorships of Delaware, Inc. In addition, other vessels were time-chartered for short periods when the need arose. As previously indicated, the carrier was primarily an automobile carrier but also transported some general breakbulk cargo and a maximum of 18 on-deck containers per voyage. The predominance of vehicles in Motorships' cargo mix is illustrated by the fact that 78 percent of their 1967 freight revenues were derived from the carriage of automobiles and trucks. This means that Motorships competed most directly with Sea-Land's car carrier, the SS Detroit. Motorships also realized considerable revenue from per-trailer FAK shipments.

(2) Voyage Patterns and Vessel Utilization.-In 1967, Motorships averaged a sailing approximately every 10 days on 35 voyages, with an average turnaround time per voyage of 12 days. In 1967, Motorships carried 17,808 tons. It first entered the trade in 1964. Vessel utilization closely paralleled fluctuations of the automobile market. During the new-car season (October through April) there was effectively 100 percent southbound utilization of the vessels while

63 These terminals are discussed in chapter VI Section E.

May through July sailings showed about 75-percent southbound utilization. August and September utilization reflected the advent of the new-model year and was correspondingly lower. Northbound utilization was estimated to be less than 5 percent of the ship's capacity. Notwithstanding the carrier's specialization in automobiles, it has competed directly with all three of the major carriers, Sea-Land, Seatrain, and TTT. In 1967, despite this competition, it managed to maintain and even increase slightly its share of the aggregate trade revenues.

e. TMT Trailer Ferry, Inc.

TMT's major terminal, in terms of tonnage loaded, is located at 215 South Georgia Street, Jacksonville, Fla. The carrier's other stateside terminal is at 605 Biscayne Boulevard, Miami, Fla. TMT's vessels operate either between Jacksonville and San Juan or between Jacksonville, Miami, and San Juan. TMT commenced operation in the Puerto Rican trade in 1954, and, as already noted, was the originator of roll-on/roll-off trailer service in this trade.63

TMT offers a tug and barge service. The barges are converted LST's which have been modified to accommodate the loading and offloading of 40

63 It is worth mentioning that TMT's roll-on/roll-off service probably encouraged the development of similar subsequent trailership operations which have generated efficiencies and relatively low rate structures in this trade.

foot trailers between the dock and the vessel. TMT's service has generally operated from and to Jacksonville and Miami. It serves only the port of San Juan in Puerto Rico offering two sailings each week from Jacksonville; voyages from Miami every 10 days. The company's own trucking hauls cargoes from San Juan to Ponce, Mayagüez, and inland points.

(1) Vessels and Containers. In 1969 TMT's five barges, the San Juan, Biscayne, Carolina, Florida, and Georgia, which were towed under contract with Florida Towing Corp. of Jacksonville, Fla., carried trailers, containers, heavy machinery, trucks, automobiles, and heavy equipment. (The Georgia, withdrawn from the service in early 1969, was disposed of in April 1970.) These barges of 2,700 deadweight tons can carry up to fifty-six 40-foot trailers, 100 automobiles, and miscellaneous units.

TMT owns a fleet of 700 dry cargo 40-foot trailers and 25 reefer trailers.6+ When additional trailers are required, they are obtained from either Realco or Xtra, Inc. A typical month may see some 200 trailers leased on a short-term basis, according to TMT. TMT is a member of the National Railway Trailer Pool and can interchange trailers with leading rail and motor carriers for direct service to inland points on the U.S. mainland. (Realco is the leasing agency for the National Railway Trailer Pool.)

TMT's San Juan terminal is located in the Isla Grande sector. TMT attempts to maintain about 250 dry cargo and 10 reefer trailers in the San Juan area, about 200 dry trailers and 10 reefer trailers in the Jacksonville area, and 50 dry trailers and 10 reefers in the Miami area, leaving approximately 200-250 dry cargo trailers and 10-20 reefer trailers aboard their various vessels at any one time.65

(2) Voyage Patterns.-It appears that the typical 1967 voyage from Jacksonville to San Juan and back took approximately 15 days with about 12 days being added if there was a stop at Miami.

TMT's vessel utilization has been good on the southbound leg of its voyages, but poor on the northbound leg. In 1966, according to the carrier's own estimates, utilization on 97 southbound trips averaged approximately 86 percent. In the same year, 94 northbound 66

64 The carrier has experimented with a new refrigeration system in which the cooling effect is attained by the evaporation of liquid nitrogen within the box.

65 Some of these reefer containers represent leased items.

Discrepancy in number of southbound and northbound voyages is due to differences in number of voyages in progress at the beginning and end of the year.

trips achieved a utilization factor of about 10 percent. In 1967 southbound utilization improved, climbing to approximately 89 percent, while northbound utilization dropped to 9 percent. The company completed 97 voyages in both 1967 and 1968.

(3) Traffic. TMT first started operations in 1954. In 1957, the company was forced into receivership, however, recovery occurred in 1958.

In 1966, the company earned $4,850,255 in the trade, carrying 87,571 weight tons of cargo. In both years, southbound revenue was more than 10 times the northbound; and southbound tonnage was approximately seven times the northbound tonnage. In 1966, containerized traffic represented 66.9 percent of TMT's traffic. Of this, TL shipments accounted for 46 percent; and LTL dry cargo, 20.9 percent. Breakbulk cargo and vehicle shipments amounted to 14.6 and 18.5 percent, respectively, of the total traffic. In 1967, revenues and tonnage climbed to $5,189,040 and 92,815, respectively. This 92,815 tons represented 3.4 percent of all weight tons moving to and from Puerto Rico by common carrier (app. C, table 1). In 1968, TMT's total tonnage climbed to 129,532. Its traffic is expected to increase about 45 percent by 1975. Appendix C, table 2 contains a list of TMT's principal southbound commodities to Puerto Rico.

f. South Atlantic and Caribbean Line, Inc.

SACAL, a wholly owned subsidiary of United Tanker Corp., operates two vessels, the M/V Floridian and SACAL Borincano, from and to Miami and Jacksonville on weekly sailing schedules.67 This carrier shares the South Atlantic-Puerto Rican trade with SeaLand and TMT. The company uses the Eagle docks at pier No. 2, Dade County Seaport in Miami, and Eagle's facilities at the Atlantic Coastline Export Terminal on Bond Street in Jacksonville. The San Juan terminal is at pier 8, Old San Juan.68

(1) Vessels and Containers.-The Floridian is a sistership to the New Yorker currently part of the SeaLand fleet. The Floridian, which was built in 1960 by

67 SACAL entered the South Atlantic-Puerto Rican trade in 1962, operating from and to Miami and Savannah with the M/V Floridian and the M/V New Yorker. In 1963, the charter on the M/V New Yorker was relinquished. In 1965, Savannah was dropped and Jacksonville added. (The M/V New Yorker is now operated by GPRL.) Shortly thereafter, the Floridian was placed in a straight Miami to and from San Juan run where it remained until June, 1967, when the SACAL Borincano entered the service. At that time, the SACAL Borincano was placed in the Miami-San Juan run, and the Floridian was placed in service between Jacksoville and San Juan.

68 Chapter VI (section B and E) deals with SACAL's U.S. mainland and Puerto Rican terminals.

the Maryland Shipbuilding and Drydock Co. of Baltimore, is a 2,191 d.w.t. vessel. It cruises at 16 knots and has a cargo capacity of 56 containers and 50 automobiles. SACAL first acquired this vessel by charter from Containerships Incorporated, along with the New Yorker.

The SACAL Borincano, first put into service in June, 1967, is an unusual vessel in many ways. This ship, described by its builders as the largest all-aluminum vessel ever built and the largest welded unit structure ever constructed of aluminum at a cost in excess of $1,600,000, is considerably more expensive than a steel vessel of the same capacity but is lighter by almost 500 tons, drawing 2 feet less, and is at least 1 knot faster. Fuel and maintenance costs are ultimately expected to be lower than with a steel vessel. This 226-foot-long vessel, which was leased to SACAL by Greyhound Leasing Corp., is one of the few oceangoing vessels now in service specifically designed for roll-on/roll-off trailer service. It displaces 1,570 tons at its design draft of 10 feet, cruises at 14 knots, and can carry 40 semitrailers on two decks.

(2) Voyage Patterns and Traffic.-In 1967, the Floridian made 50 voyages and the Borincano 27 voyages. In 1966, SACAL earned some $3 million, or 3.6-percent of the aggregate revenues earned by common carriers in the Puerto Rican trade for that year. This compares with 3.7 percent for 1963, the company's first full year of operation. Containerized traffic comprised 82 percent of SACAL's traffic (TL traffic accounted for 64 percent; LTL traffic, 18 percent). SACAL derived more than

85 percent of its revenues from three items. The three most important sources of revenue were: an FAK pertrailer rate 69 of $700 per 35-foot trailer (or $800 per 40-foot trailer on dry cargo); an FAK per-trailer rate of $1,000 per trailer for refrigerated cargo; and rates on passenger automobiles. In 1967, SACAL transported 94,357 tons or 3.4 percent of all weight tons moving to and from Puerto Rico by common carriers (app. C, table 1). Its traffic is expected to increase 67 percent by 1975. The principal commodities transported southbound by this carrier are listed in appendix C, table 2.

g. Gulf Puerto Rico Lines

As indicated previously, GPRL is the major carrier operating from and to U.S. Gulf ports and the second operating subsidiary of McLean Industries to be considered here. GPRL, or its predecessors, has been serving the Gulf-Puerto Rican trade since 1927 when Waterman Steamship Co. (Waterman) entered the trade. GPRL has served Houston, New Orleans, and Mobile, and the Puerto Rican ports of San Juan, Ponce, and Mayagüez. GPRL's only potential competition in the Gulf trade consists of Lykes and, potentially, Indian

70

09 For a fuller definition of FAK rates, refer to chapter IV, section A.

TO In 1938, Waterman established a weekly service between U.S. Gulf ports and Puerto Rico. In 1940, Waterman began construction of a waterfront complex in San Juan. In that year, a subsidiary corporation called Waterman Dock Co. was formed to operate this complex. Subsequently, this corporation became known as Waterman Steamship Co. of Puerto Rico. It continued under this name after being acquired by McLean Industries in 1958 until June 1965 at which time it adopted the name Gulf Puerto Rico Lines, Inc.

Towing, which is currently operating solely as a contract carrier.

(1) Vessels and Containers.-GPRL operates two 15-knot 10,000-d.w.t. breakbulk ships and one 16-knot combination container and car-carrier vessel of 2,189 d.w.t. in the trade. The two breakbulk vessels are the Maiden Creek, built in 1946, and the Claiborne, built in 1942. The Claiborne has some below-deck reefer space; the Maiden Creek does not. However, the Maiden Creek can carry a limited number of either dry cargo or reefer containers on deck. The M/V New Yorker, a combination roll-on/roll-off and containership, which was shifted to the Gulf trade from Sea-Land's coastwise service, has operated in a triangular run from Houston to New Orleans to San Juan and back to Houston, offering biweekly truckload-only container service. This relatively small containership has a capacity of only 66 containers and 20 vehicles.1 GPRL leases all the containers it uses from Sea-Land, drawing them from the Sea-Land pool in Puerto Rico.

(2) Voyage Patterns and Traffic.-The Claiborne serves Mobile, New Orleans, San Juan, and Mayagüez; the Maiden Creek calls at Mobile, New Orleans, San Juan, and Ponce. This provides San Juan with weekly service while service to Ponce and Mayagüez is biweekly. Besides serving Puerto Rican ports directly, GPRL has a transshipment agreement with Berwind which provides for on-carriage to the Virgin Islands under a combination-of-rates arrangement. GPRL has a joint through service arrangement with Sea-Land in the Dominican Republic Conference. In addition, GPRL has effected a through rate arrangement with Mexican Lines between Puerto Rico, Mexico, and Central America by transshipments at the Port of New Orleans.

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ried approximately 12.5 percent of all the weight traffic moving to and from Puerto Rico by common carrier (app. C, table 1).

h. Lykes Bros. Steamship Co., Inc.

Lykes has been in the Gulf/Puerto Rican trade since 1921. Today, Lykes serves Houston and Galveston, Tex., and Lake Charles, New Orleans, La., Mobile, Ala., San Juan, Ponce, and Mayagüez, P.R. There is a scheduled sailing from these ports approximately every 2 weeks. In addition, Lykes will call, by prior arrangement if sufficient cargo is offered, at Corpus Christi, Texas City, Beaumont-Port Arthur, Port Neches, Orange, and Freeport in Texas, and Port Tampa in Florida, as well as at numerous small outports in Puerto Rico, including Aquadilla, Arecibo, Guanica, Jobos, Guayanilla, and others."4

(1) Vessels and Containers.-Lykes' operation is essentially breakbulk, but small quantities of cargo, approximately 3 percent in 1966, were classed by the carrier as moving in containers."

75

In 1966 and 1967, Lykes used 13 units of its 54vessel fleet 7 in the Puerto Rican trade on a basis of availability and scheduling obligations. Only two of these vessels were used in this trade at any one time. All of Lykes' vessels are 15-knot, 11,300-d.w.t., C-2-type vessels of World War II vintage."

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4 Lykes and GPRL are the only major carriers serving the Gulf region. Indian Towing Co., Inc. (Indian Towing), primarily is a barge-operating carrier operating out of the U.S. Gulf ports. It holds itself out to call at practically any port of any size from Philadelphia, Pa., to Brownsville, Tex., in the United States when sufficient cargo is offered; San Juan, Ponce, and Mayagüez in Puerto Rico; and Charlotte Amalie, St. Thomas, and Cruz Bay, St. John and Fredericksted, St. Croix, in the Virgin Islands. Although Indian Towing has been active in the trade at various times since 1962, at the present time its activities are confined to limited large volume carriage out of the Gulf ports. (This carrier is discussed more fully under unregulated water car. riers following.) In addition, Southeastern Barge Lines entered the trade in October 1968, operating a barge service between Savannah and Brunswick, Ga., on the one hand, and San Juan and Ponce. Its pattern of service calls for a sailing approximately once a month. This is the only carrier in the Puerto Rican trade actually calling at these two U.S. mainland ports. Since this carrier has just entered the trade, no information concerning its operations, equipment and traffic is available.

These containers are of three types: the LB No. 3, a plywood box of approximately 300 cubic feet; the LB No. 5 of approximately 500 cubic feet; and a crib-type container, somewhat resembling a cattle pen but smaller and tailored to the commodity being carried. Approximately 10 such containers are carried each voyage. In addition, there are deck tanks used in the carriage of refrigerated cargo that are classed as containers.

76 The 13 vessels were: the SS Charles Lykes, Dick Lykes, Eugene Lykes, Elizabeth Lykes, Louise Lykes I, Mallory Lykes, Tyson Lykes, Velma Lykes, Harry Culbreath, Kendall Fish, James McKay, Kenneth McKay, Reuben Tipton. 77 Hearings in Maritime Administration docket No. S-215, Delta Steamship Lines, application for section 805(a) permission to serve Puerto Rico revealed that Lykes has an obligation under its subsidy contract to replace the ships in the service which largely transports U.S. Gulf/Puerto Rican traffic, and that this replacement of ships has been repeatedly deferred.