Published online by Cambridge University Press: 05 October 2015
“What Price Speed?”
Giuseppe Gabrielli and Theodore von Kármán, 1950Declining American Marine Industry
In the late 1950s and early 1960s, the American marine industry was in trouble. Nicolas Johnson1, US Maritime Administrator (1964–1965) discussed the problems of the high cost of shipping exports overseas which also meant an increase in the cost of American goods to the foreign consumer. In 1960, the US Share of world shipping was less than 10% despite a major shipbuilding program that had been underway in the US during World War II. Unfortunately, most of the shipbuilding in the US during WW II was embodied in the American Liberty Ship, a standard dry cargo vessel (approx 10,902 dwt) and the T2 tanker (16,543 dwt). The Liberty ship was a wide bodied, bulbous ship with a disappointing top speed of 11 knots. Most of the foreign ships at that time were designed for higher speeds (14 knots and more). This placed the US at a disadvantage in capturing any significant share of the world shipping trade.
This decline in the US share of world shipping, that continues to this day, is shown in Figure 7.1. In addition, there was the problem of high labor and high capital costs, which caused the US government to subsidize the shipbuilding industry at rates at different times through this period of 30% and 50%. The US Maritime Administration needed to find another solution. At that time, the only alternatives available to the shipper was “By Sea” or “By Air” with vastly different costs. The two choices available to the shipper, whether it be a manufacturer of say automobile parts in Detroit or a grain supplier in the mid-West; were to ship by air at 20 cents per ton mile and have his goods arrive within 24 hours, or ship by sea at 5 cents per ton mile and have his goods arrive say, 5 days later. Issues of weight and bulk (space) and needs of roll-on, roll-off capability also entered into the decision of which shipping method to use, but the cost was a significant driver.
As a further indication of the US Maritime Administration concern was the significant drop in the US shipbuilding construction.
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