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Shipyard Closures During 1984
Shipyard Month Closed
Paducah Marineways, Inc., Paducah, Kentucky January
Campbell Industries, Inc., San Diego, California April
Dravo Corporation, Pittsburgh, Pennsylvania April
Teh Tung Steamship, Orange, Texas May
Maryland Shipbuilding & Drydock Co., Baltimore, Maryland July
Geosource, Inc. (Marine Service Div.), Harvey, Louisiana August
Zidell Explorations, Inc., Portland, Oregon August
Dredgemaster International Corp., Hendersonville, Tenn. September
Savannah Shipyard Co., Savannah, Georgia September
Wiley Manufacturing Co. (Equipment Systems, Div.),
Port Deposit, Maryland September
Munro Drydock, Inc., Chelsea, Massachusetts December
Keen, often cutthroat, competition on most international trade routes; the near collapse of the steamship conference system in the Pacific; unbalanced flows of cargo, especially in the transpacific trade; and uncertainty concerning government policies toward national-flag merchant fleets all combined to make 1984 a time of testing for American shipowners.
Among the favorable developments of 1984 were the entry into service of the first of the supercontainerships constructed for United States Lines; the conclusion of the fleet modernization plan of American President Lines; the optimism demonstrated by Lykes Lines in ordering six large ships for delivery in 1986; the profitable operation of Sea-Land Service as an independent entity; the successful start of a new American-flag shipping operation from the United States to Iceland; the dedication of a $40 million facility by Todd Pacific Corporation; and the contract with a San Diego shipyard to build two very large crude petroleum carriers for Exxon Corporation.
Less happy news in 1984 included a small American-flag steamship company that ended its two-year-old operation; a tug-barge service to Puerto Rico was forced to suspend activity, facing possible bankruptcy; the closing of a number of shipyards (see table); the last combination passenger-cargo ships in regular service were withdrawn and laid up; and efforts to finance construction and modernization of passenger cruise ships proved futile.
In Congress, the great achievement was passage of a bill to update the authority of the Federal Maritime Commission to oversee the business practices of carriers engaged in the foreign oceanborne commerce of the United States. The Shipping Act of 1984, which in large measure supersedes the Shipping Act of 1916, was signed into law by President Ronald Reagan on 20 March and became effective on 18 June.
To summarize the year, it was a time of strain and stress, relieved by some notable successes and marred by some commercial tragedies.
Worldwide Shipping
Faced by statistics showing almost 16% of tanker tonnage and 4% of dry cargo tonnage laid up for lack of cargo, shipowners worldwide were deeply concerned about their economic future. At the end of September 1984, 335 tankers of 50.1 million deadweight tons were idle, as were 1,100 dry cargo carriers of 15.1. million deadweight tons. The percentages of national-flag fleets in inactive status were; Denmark, 26%; France, 20%; Greece, 18%; Norway, 17%; Liberia, 15%; and the United States, 14%.
In the closing days of 1984, Evergreen Line of Taiwan, began a two-way, around-the-world service with a fleet that
ultimately will number 12 very large, newly built containerships. United States Lines almost concurrently started its east- bound, around-the-world operation with the first of what will be another 12-ship fleet. Between the two carriers, over $2 billion will have been invested by the end of 1985 in a total of 36 vessels and the necessary supporting equipment. What is of concern is that the capacity of the world containership fleet grew from 1.35 million 20-foot equivalent units in 1982 to nearly two million in 1984. This 48% increase was matched by only a 30% rise in traffic, and resulted in freight rates in the six major trade routes dropping by 27%. Predictions as to the future of the two giant lines covered the spectrum from optimism to deep pessimism.
For over a century, liner services in the various trade routes have maintained selfregulation associations to stabilize competition. During 1984, in the desperate effort to fill the excessive number of ships competing for scarce cargoes, carriers resigned from these conferences in order to be free to quote whatever freight rates they deemed appropriate to obtain the business. The conference structure, especially in the Pacific, was badly shaken during the year, but seemed strengthened somewhat by the new regulations established by the U. S. Shipping Act of 1984.
The flow of export commerce from the United States, still the world’s premier marketplace, has been hindered by the value of the dollar compared with foreign currencies. This has resulted in heavy loads destined to the ports of North America and minimal tonnage outbound, complicated by the need to reposition containers to overseas ports. In too many cases, these empty containers had to be transported free of charge, with all expenses of handling defrayed by the shipowners.
Transoceanic operators have survived the year only by drastic reductions in sailings, formation of consortia, space chartering, and major economies in both ship operation and shoreside administration. It has been a difficult and not always re-
warding period for nearly all shipowners.
As of 1 September 1984, the U. S. Merchant fleet had 399 ships in active status. Of this number, 114 were fully containerized or carried their cargoes in lighters or barges. The bulk carrier fleet consisted of 49 ships of 702,000 deadweight tons. In the inactive fleet were 217 breakbulk vessels.
The Shipping Act of 1984
Authority to supervise the commercial practices of carriers, regardless of nation- a,ity, participating in the oceanborne foreign trade of the United States has derived from the Shipping Act of 1916. Inevitably, the tremendous changes in the steamship industry during the last quarter century made major changes in legislation a pressing necessity. Begun in 1977, the continuing effort to enact laws that would reflect the steamship business in the container age reached its successful conclusion with the signing of the Shipping Act of 1984.
Among the principal features of the new law were clarification of the antitrust 'mmunity granted to steamship conferences, continuation of the mandate that these rate-making associations be open to any and all bona fide liner service operators applying for membership, and elimination of the long-used exclusive patronage contracts. Agreements establishing carrier conferences, under the new law, must be approved by the Federal Maritime Commission within 45 days unless clear violations of existing statutes are detected on first examination. In such an event, the commission no longer serves as the judicatory, but must present the case to the U. S. District Court in Washington, D.C. for appropriate action. Still Undetermined is the impact on shipping Practice of a stipulation that individual members of steamship conferences must be free to quote rates independently, on not more than ten days’ notice to the conference. Associations of shippers, as a counter to the carrier groups, also are permitted, under carefully detailed restrictions.
Taking advantage of the provisions of the new legislation, nine transatlantic conferences were consolidated into two groups, one serving the export and the other the import (westbound) trade. These new conferences cover the entire U. S. Atlantic Coast, whereas their predecessors applied either to the North Atlantic (Maine to Virginia) or the South Atlantic ports (North Carolina to Florida). Similarly, the Trans Pacific Westbound Rate Agreement, effective 5 January 1985, replaced several conferences which had covered trade between the United States and the Far East.
In general, the new law liberalizes the regulatory procedures and is intended to foster a more competitive atmosphere among carriers. Because it changes much of what has been customary since 1916, there was considerable uncertainty among steamship operators as to the long-range effect of the law. Decisions and interpretations by the Federal Maritime Commission and the courts will be studied with care at least for the next year.
Maritime Administration
Of major importance to the U. S. maritime industry and port authorities was the announcement on 18 December 1984 that the Maritime Administration (MarAd) had adopted final policy positions relating to use of the merchant fleet in time of war or national emergency. The principal points outlined in the announcement were:
► A defense agency is empowered to ask MarAd to direct vessel operators, suppli-
The new super containership American New York, went into service for the United States Lines in 1984. She is 950 feet long and can carry more than 2,000 40-foot containers.
ers of containers, and port authorities to give “priority use or allocation of service and equipment” to the defense agency on a “commercial” basis when established procurement practices for transshipment cannot obtain these resources.
- “Use” of existing commercial services does not contemplate requisition of property in any manner.
- MarAd, rather than port authorities, will “identify” the facilities required to meet defense needs.
- “Imminent,” in reference to the invocation of this authority, is defined as the time when “the president has directed deployment or preparation for deployment.”
- Indemnification for loss of equipment under this authority to “use” will be that which “may be agreed upon between the defense agency and the provider of the service.”
- Positioning containers will be paid for - only in accordance with commercial tariffs or existing contracts.
- Failure to comply with these regulations may be punished by fines up to $10,000 or imprisonment for not more than a year.
Cargo Preference
During the 1960s and 1970s, numerous ships, principally tankers and a few bulk carriers, were built by American operators who depended heavily upon those cargoes which, by law, were reserved for ships of U. S. registry. In making their decisions to construct ships in American shipyards, they considered the competition they could expect from existing vessels or those under construction or on order. When owners of several tankers built with construction differential subsidies requested permission from the Maritime Administration to participate in the transportation of these “preference” cargoes, the reaction was predictable. Since the 1970s, the battle has been waged with greater or lesser intensity and became significant during 1984.
Because there are very few American- flag bulk carriers, and tankers can carry bulk grain quite efficiently, competition today is between owners of tankers built with subsidy and tankers built without such assistance. The 49 bulk carriers registered in the United States seek grain cargoes with the same eagerness as the
When this eye-catching photo was taken last year, the heavy-lift vessel Sunrise was transporting containerhandling cranes to the Sea-Land facility at Tacoma, Washington.
tanker owners, but the tanker fleet is predominant.
Those ships in competition with foreign-flag vessels hauling governmentgenerated cargoes may request, and frequently will receive, operating differential subsidy payments. The theory is that the subsidy will bridge the gap between the low rate offered by the foreigners and the higher rate the Americans must charge because of heavier expense.
Obviously a carrier receiving operating subsidy payments can quote freight rates that are lower than the minimum acceptable to a non-subsidized American shipowner. Having been rebuffed in December 1983 by a federal court which was not convinced that this kind of competition was unfair, Phoenix Bulkship II, Inc., owners of the unsubsidized Jade Phoenix, returned to court in January 1984 to argue their case against permitting subsidized carriers to transport preference cargo. The effort was successful, at least temporarily, and resulted in a ruling favorable to the plaintiff.
The issue refuses to die. On 1 April a new set of rules governing eligibility for preference cargoes was put into effect by the Maritime Administration. The Federal Acquisition Regulation stipulated once again that one half of the import and export cargoes generated under various federal programs must be moved in American bottoms. It also set forth these particulars: Both major contractors and subcontractors are subject to this mandate; more systematic reporting of cargo movements will be required; liner rates filed with the Federal Maritime Commission are deemed to be fair and reasonable for these cargoes; and cargoes financed by federal loans, grants, advances, and guarantee programs are made subject to the law, which will be administered by the Maritime Administration.
Two days after the promulgation on 17 January 1984 of this Federal Acquisition Regulation, the Maritime Subsidy Board published its decision that subsidized carriers could compete for preference cargoes, but their quoted rates would be reduced by the value of the subsidy received. The first beneficiary of this ruling was the Golden Endeavor, a bulk carrier owned by Aeron Marine Shipping Company, a subsidiary of the subsidized
Berger Group of Lake Success, N.Y. The ship was permitted to carry 133,000 metric tons of wheat to Sudan under a Department of Agriculture program.
The General Accounting Office published on 13 February an analysis of the dependence of U. S.-flag ocean carriers on government-generated cargoes. It found that during 1980 more than one third, by volume, of the cargoes lifted by U. S.-flag ships came under preference requirements. Defense shipments amounted to 71% of the cargo lift; Department of Agriculture offerings were next with 18%. Liner service ships transported about half the Defense tonnage, and about three-fifths of Agriculture’s business. To provide the sealift, 21-33 ships employing 1,400-2,200 seamen were needed, at an added cost to the government, compared with moving the cargo in foreign-flag ships, of $78.6 million. Despite the preference laws, however, bulk carriers’ share declined from 13.4 million tons in 1970 to 12 million tons in 1980. In the same period, foreign- flag operators increased their lift by 71.2% to 701 million tons.
A sharp controversy developed in July when the Agency for International Development (AID) announced that approximately two million tons of government- financed cargoes exported through Great Lakes ports, regardless of flag, would be subtracted from the overall tonnage to which the 50% preference law applied. Because very few American carriers serve the Great Lakes ports, and because of the quantity of AID cargoes involved, shipowners, port authorities, and the disputing agencies of the federal government were drawn into the controversy. On 6 August, AID issued a new statement of policy which assured the ports that 20% of the relief cargo movement would be channeled through their facilities. The full 50% of total tonnage would be offered to U. S.-flag ships in accordance with the intent of the law. The widespread reaction of these different interests was a measure of the importance of preference cargo to U. S. shipowners, port authorities, and the government.
Shipyards
Shipbuilding traditionally has been a cyclical enterprise, experiencing booms and major depressions. The year 1984, even to veteran shipbuilders, was a very difficult period, both in the United States and Europe. Japanese yards were being undercut by Korean shipbuilders. Order books almost everywhere were so close to bare that pessimism was the common attitude.
In the face of this situation, it is hardly a surprise that shipbuilding in the United States was at a very low point. Construction differential subsidies have not been authorized by the Reagan Administration since fiscal year 1983 began, and major reliance necessarily has been placed on naval construction to keep the industry alive. A brief survey of principal yards provides details.
Maryland Ship Building and Dry dock Company, a subsidiary of Fruehauf Corporation, was closed permanently on 31 July.
Bethlehem Steel Company sold its Key Highway yard, closed since 1982, to a local joint venture which liquidated the assets by auction sales beginning in October.
Bethlehem Sparrows Point (Baltimore), despite wage concessions by its labor force that reduced its shipbuilding cost estimates, failed to win any contracts. Layoffs were inevitable as work terminated on the conversion of ships for the Navy’s prepositioning fleet.
WE
Bethlehem Port Arthur (Texas) was awarded the Navy’s surplus floating dry- dock (capacity 56,000 tons). It was towed from Hawaii and arrived in Port Arthur at the end of 1984. It is to be operational by spring 1985. The yard expects work on offshore oil drilling and production equipment to justify the allocation of the dry dock to this economically deprived area.
Todd Pacific Shipyards (Seattle) and Lockheed Marine Corporation were hit By significantly higher labor costs than those of their competition. Todd paid wages averaging $13.50 per hour and Lockheed paid $14, compared to Newport News Shipbuilding & Dry Dock Company’s $9.97; General Dynamics (Quincy yard), $10.27; Avondale (New Orleans), a non-union operation, $10.32; Litton-Ingalls (Pascagoula), $10.70; and National Shipbuilding & Steel (San Diego), $11.01.
f Todd Pacific dedicated its $40 million
Synchrolift” facility at its San Pedro yard on 27 March 1984. This patented system will enhance the yard’s ability both to repair and build ships with a maximum weight of 14,720 long tons, length not exceeding 665 feet, and breadth of 105 feet.
Todd and Mitsubishi Heavy Industry America, Inc., agreed in principle to exchange data on ship construction and conversion technology. According to a 3 May press report, Mitsubishi has made great strides in group technology as it applies to shipbuilding. Group technology, it was explained, entails the manufacture, assembly, and testing, in an optimum sequence and manner, of large sections or modules at individual work stations outside the vessel’s hull. The system involves extensive use of computers, automated equipment, and software starting at the design phase of a ship and continuing through construction and follow-on work. In exchange, Todd will share its highly-developed shipbuilding technique.
By transferring a floating drydock with a lifting capacity of 15,000 tons from Galveston to New Orleans, and installing a 45-ton capacity whirley crane, Todd has expanded the capability of its New Orleans division by 80%. This shifting of assets, according to Todd president H. K. Schaefer, is part of a continuing program °f facility additions, improvements, and modifications at New Orleans.
Tacoma Boatbuilding lost $19.9 million in 1983. In May 1984, its employees agreed to a pay cut of $2 per hour and a Wage ceiling of $11.50. Compensation for the hourly differential would be in the form of shares of stock in the company.
The lower pay schedule returned all workers to a five-day week. Some of the labor force had been employed only four days each week.
A newly-formed investor group headed by Tom Weller, Jr., a real estate developer in Mobile, Alabama, announced on 7 May 1984 that it had purchased an unspecified but “substantial” interest in Paden, Inc., of Orange, Texas. Paden is the corporate parent of Orange shipbuilder Levingston Industries and Pennsylvania Shipbuilding Company, of Chester.
The Santa Mercedes, a passenger- cargo ship formerly operated by Delta Line, was allocated by the Maritime Administration to the Massachusetts Maritime Academy to replace the fire- damaged Bay State. Initial work to convert the ship, which as a training vessel will bear the name of Patriot State, was performed in 45 days by Triple-A Shipyard, of San Francisco, at a cost of $1,967,251. The major job of conversion was given to Bender Ship Building & Repair Co., Inc., of Mobile, for $5.6 million. This award was announced on 18 December; no completion date was designated.
Avondale Shipyard delivered the Exxon Bayonne on 12 July 1984. The 43,000-ton, diesel-powered ship was the last of three ordered in 1981. She will be used to carry up to 43 different products in separate tanks. Normal operations will be between Gulf Coast refineries and East Coast customer terminals. Exxon Shipping Company also took delivery from Avondale of the Exxon Baytown in July. This motorship has a deadweight of
- tons and is designed to carry crude petroleum. She is the first ship of that type to be ordered by Exxon since 1979.
Exxon announced on 28 August that it had awarded a $250-million contract to National Shipbuilding and Steel Company, of San Diego, for construction of two diesel-propelled crude oil carriers of
- tons, equivalent to a 1.5-million-barrel capacity. In addition to incorporating the highest standards for safety and protection of the environment, these ships will have satellite navigation and communication systems. Delivery of the ships is set for the last quarter of 1986 and the first quarter of 1987.
Military Sealift Command
The Military Sealift Command (MSC) continued its practice of soliciting bids from American-flag carriers to transport military cargo for six-month periods. In the first round (1 April-30 September
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- , eight carriers were represented, including the non-citizen Trans-Freight Lines. This company would have been required to transfer registry of at least one of its ships to the United States in order to lift military cargo; its rates, however, were too high to be given consideration. Spokesmen for MSC estimated the government would save about $5 million in this first semester, compared with the same period a year earlier. When bids were received for the second half of the cargo year (1 October 1984—30 March
- , the rates were noticeably lower than for the preceding six months. These examples were typical: West Coast to Philippines, $31.25 per measurement ton in the first period and $14.50 in the second. Transatlantic cargo was hauled for $22.22 in the first cycle and $16.74 during the fall-winter season.
The crane ship Keystone State (formerly the American President Lines’ President Harrison) was delivered in May to MSC by Bay Shipbuilding Corporation, of Manitowoc, Wisconsin, ahead of schedule and within budget. She was the first of 11 ships acquired by the Navy for conversion to provide container-handling capability in open roadsteads and primitive harbors for nonself-sustaining containerships. Each of the Keystone State's three sets of twin booms, all on the port side and with an outreach of 105 feet, can lift an M-60 combat tank. A single crane can handle a 33-ton container. Officially designated by the Navy as T-ACS-1, she is assigned to MSC. A civilian crew will man her.
Vice Admiral W. H. Rowden, commander of MSC, noted that the Keystone State can handle a large containership on her starboard side and any number of landing craft and lighters on the port side. It is expected that this type of crane ship will be able to load and unload 300 containers per day.
The Maritime Administration (MarAd), acting for the Navy, selected Interocean Management Corporation, of Philadelphia, as the general agent to operate the Keystone State. The corporation was granted a one-year contract to crew the vessel for a performance demonstration and other training exercises beginning in May. On completion of this program, the ship will be placed in the Ready Reserve Fleet of the National Defense Reserve Fleet, and maintained in a high state of readiness.
The second crane ship conversion was begun in October when MarAd on behalf of the Navy awarded a contract to Continental Maintenance, Inc., of San Francisco, for work on the President Monroe. The 12-month project will cost $17,952,454, and will entail reactivation of the ship’s machinery, repair of broken components, and installation of the rotating pedestal cranes.
On 7 August 1984 MSC announced that it had chartered for four and a half years the ice-strengthened, German-built motorship Woerman Mira from Central Gulf Lines. The ship commenced service in the Arctic and Antarctic in January 1985, by which time she had been re-registered as an American vessel, manned by American union seamen. She has six cranes of 25-ton capacity and two elongated hatches which are served by four cranes which can be married to lift 80 tons. She can transport both containerized and breakbulk cargo. The vessel will replace the USNS Southern Cross, which will be laid up.
The Navy and MSC acquired 19 ships in June to expand the fleet of ready-to-use vessels in the National Defense Reserve Fleet. Obtained at a cost of $30 million were six partial containerships from Delta Steamship Lines and 13 breakbulk vessels from Lykes Brothers Steamship Company. Ships in the Ready Reserve Fleet are maintained in a condition assuring complete reactivation in five to ten days. The 19 ships from Delta and Lykes
(Continued on page 331)
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U. S. Merchant Marine in 1984 (Continued from page 72)
Wl! be placed in the James River (Vir- 8'nia) and Beaumont (Texas) anchorages. Concurrent with the delivery of the lrst °f eight big and fast Sea-Land con- ^merships (SL-7 type) for service in the ,^2 s Maritime Prepositioning Ships MPS) fleet, MSC awarded a three-year C°ntract to Sea-Land Service, Inc., to man; operate, and maintain in four-day readiness four of these vessels. The Ilvx"miHi0n contract; t0 manage the NS Algol, Antares, Bellatrix, and Ca- Peda became effective on 15 June.
To support the four ships assigned to ea-Land, the Military Sealift Command negotiated a contract with Sealift Termi- als> Inc., for berthing space in Jackson- .1 ie, Florida, for two ships. The contract ls firm for one year at a price of $1.7 ja* lion; MSC has the option to renew for °Ur additional years. A similar contract as awarded to Violet (Louisiana) Dock 0rt> Inc. for $1.9 million.
On 9 August, MSC publicized the or- Sanization of the Fast Sealift Ship Readi- l^ss Support Squadron, with headquar- ®rs in Mayport, Florida. Captain T. E. °rin is squadron commander, and will assisted by two naval officers, three n *sted persons, and three civilians. The ^uadron will be responsible for on-scene 'Action of ship operations, monitoring ivilian contractors’ performance, in- Pecting equipment maintenance, dock
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and sea trials, shipboard training, and planning for execution of hurricane sorties. When the ships are in active status (about one month each year) the squadron will assist MSC area commanders in loading the ships and supervising their operation. Present plans are for the ships to be in reduced operating status, with on-board crews of nine merchant seamen, for 11 months each year. When activated, they will have full crews of 42 civilian seamen.
In November, MSC reported that the USNS Algol participated in the NATO exercise Reforger 1984, and the USNS Capella took part in exercise Gallant Eagle 84.
Delivered by Bethlehem Sparrows Point on 3 August, the CPL Louis J. Hauge, Jr. (formerly the Estelle Maersk) was the first of five Danish-built ships to be converted into units of the MPS fleet. The Sparrows Point yard had contracts for three of these Maersk Line ships and Bethlehem’s Beaumont yard was working on two. All five vessels now are owned by an American banking consortium, with Morgan Guaranty Trust Company serving as the financial agent for the reconstruction. As the ships are completed, they will be chartered by MSC and operated as U. S.-flag vessels by an American affiliate of Maersk Line.
In February, MSC chartered the American Veteran (formerly the Austral Moon) from United States Lines for two years at the fixed price of $27,635,594. The Lighter Aboard Ship (LASH)-type carrier was assigned to the Near Term Prepositioning Force, and replaced the Lykes Line’s Gulf Shipper and Central Gulf Line’s Bay.
The Vindicator, third of the fleet of 12 specialized ocean surveillance vessels being built by Tacoma Boatbuilding Company, was launched in June. The fourth ship was to be launched in September, with the remaining eight scheduled for launching at three-month intervals until October 1986. To be operated by civilian crews employed by MSC, the ships are equipped to detect and measure sound at different ocean depths. As noncombatant vessels, they will be painted white and will carry no armament.
A decision by MSC (Atlantic), effective 1 July 1983, to terminate longshoremen pay to members of ship crews who unloaded or loaded ships was appealed to arbitration by the National Maritime Union. On 16 April 1984 the arbitrator, Earle W. Zaidins, handed down his judgment that MSC had violated its collective bargaining agreement with the union. Seamen who performed this kind of work must be paid retroactively, together with the prevailing rate of interest. Nothing was published to indicate the number of
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Trade between Alaska and the “lower 48” is restricted to shipping built, owned, and operated in America. As the northernmost state has grown, opportunities for ocean transportation firms have become more attractive. In January 1984 a new company announced its entry into the trade with two triple-deck trailer- barges. Crowley Maritime Corporation’s well-established Alaska Hydro-Train added second decks to carry containers on its six rail-car barges. The major ship operators, Sea-Land Service and Totem Ocean Trailer Express (TOTE), continued their regular and frequent sailings. A freight traffic analyst noted that about 25% additional capacity had been made available, but only a 5% growth factor was anticipated.
SeaWay Express Corporation, affiliated with Marine Power & Equipment Company, of Seattle, entered the trade as a non-union operator both afloat and in its cargo handling terminals at Seattle and Seward (one of the seacoast terminals of Alaska Railway). Its barges are 487 feet long by 104 feet wide and each can carry 330 highway truck trailers 40 feet long. They have ship-shaped bows and flat bottoms for easy movement through strong seas. Towed by 10,000-brake-horsepower tugs, the barges average 13 knots, according to a company spokesman. Sailings occur weekly on a year-round schedule; transit time is six to seven days.
Crowley’s Alaska Hydro-Train is operated between Seattle and Whittier, the other terminal of the Alaska Railway. Each Hydro-Train barge transports loaded railcars on the lower deck and accommodates 100 truck-trailers on its upper deck. Sea-Land Service has dedicated four containerships to the Seattle- Anchorage service; TOTE runs two large, roll-on/roll-off ships between Tacoma and Anchorage.
On 23 October 1984 Sea-Land contracted with Bay Shipbuilding Company, of Manitowoc, Wisconsin, to build three new ships for the Alaska route at $60 million each. The ships will have a capacity of 700 40-foot containers, and will be assigned to the Puget Sound-Anchorage- Kodiak service. Deliveries are expected in August and November of 1986 and May of 1987.
Prohibited by law from exporting its oil to foreign buyers, Alaskan producers ship only to the lower 48. This protected trade has become the only profitable employment for American-flag tankers, especially those over 100,000 tons deadweight. Orders for construction of some of the big tankers, however, were placed during the 1970s, when demand for very large crude carriers was at its peak. It was the owners’ intention to find employment in the world market, and therefore they accepted construction subsidy from the Maritime Administration (MarAd). Unfortunately, by the time the ships were delivered, the need for huge ships had disappeared. Instead of seeking charters on the world market, these supertankers had to look to Alaska for employment- MarAd in 1977 adopted a policy, over the strenuous objections of the owners ot nonsubsidized tankers, to permit ships built under subsidy to enter the Alaska trade for not more than six consecutive months out of 12, and during that time to pay back a proportionate amount of the construction subsidy. In October 1983. the policy was modified to require subsidized tankers to lie idle if a non-subsi- dized ship had no employment. The Arc° Independence, Maryland, and liamsburgh were authorized to enter the Alaska service subject to these conditions. In January 1984, prior to the end ot the six-month period, these ships were ordered into lay-up because non-subsi- dized tankers were otherwise to lie idle- The issue lay dormant until November 1984, when authority was granted to the owners of the Brooklyn and Maryland t° operate for six months between Valdez and the western approaches of the Pal1' ama Canal. Arco Transportation Company had requested similar authority t°r its Arco Spirit, but even though the apph" cation had been submitted at the same time as papers for the Brooklyn an Maryland, the authority was denied because of a “lack of need for a very large crude carrier in the Alaska trade at tins time.” In its announcement, MarAd sain it was planning to review its policy 0 tanker employment in the Alaska trade- Without waiting for this review, the aggrieved owner took the case to the Unite0 States District Court in Washington- D.C. The court had not reached a decision at year’s end, and the promised po1' icy review had not been made public-
Steamship Companies _
American Caribe Line (AMCAR): On 2-J February 1984, AMCAR commence operation of a weekly tug-barge service from Jacksonville to San Juan, Puerto Rico. Three tug-barge combination units were to maintain Friday sailings from tn mainland and Monday departures frorn the island.
AMCAR was backed financially by
ulf Fleet Marine, a New Orleans subsidiary of Houston Natural Gas, and Eller * Company, a major ship agency and marine terminal operating firm in Jacksonville. The tugs and barges were leased y AMCAR from Gulf Fleet Marine.
In its effort to attract business, the new company advertised that it would not increase rates for a full year. Tariffs filed Wlth the Federal Maritime Commission
On 22 November, one of AMCAR’s arges was driven ashore by a storm. The company’s service was suspended imme- ■ately. On 26 November, Gulf Fleet Marine cancelled the barge charters, and cn 25 November it and five other credits attempted to force the company into Nuidation. The Federal Bankruptcy ourt in Atlanta denied this, and granted „"ICAR’s request to reorganize under
tjnoted rates “practically identical” to °se charged by its competitors— nvieras, Crowley Marine’s Trailer Ma- nne Transport, and Sea-Land Service.
Trailer Marine Transport maintained ^eekly service from Philadelphia, Lake narles (Louisiana), and Mobile, and ■-Weekly sailings from Jacksonville, ■ke AMCAR, Trailer Marine was a tug- arge operator. Sea-Land provided non- jjtoP containership service from Eliza- eth, New Jersey; Jacksonville; and New deans. Navieras ran ships weekly from lizabeth, Baltimore, Charleston, Jack- s°nville, and New Orleans.
hapter 11. The creditors’ petition stated at AMCAR owed them $2.19 million, and that the carrier’s total unsecured debt amounted to $4.8 million. On 5 Decem- ®r> the creditors filed another petition k'reging cash receipts and collections had sen diverted for “improper uses.” No Ufther developments were made known y the end of December.
American Coastal Line (AMCO) an- n°Unced on 1 November that it was end- jag its North Atlantic service. William B. IS'eeIy, president of the two-ship company, attributed the decision to the loss of • S. military cargo and to the unanticipated high cost of meeting Coast Guard reluirements subsequent to the most recent five-year survey. The keen competi- . °n for commercial business on the 0rth Atlantic trade route, coupled with Prevailing low freight rates and the unwanted movement of goods, overhelmed the company. The Amco Voy- ^Ser and the Amco Trader were arrested y creditors early in November. Attachments were filed by these creditors who averted that AMCO owed $3 million.
^ The Amco Trader was auctioned at a . ■ S. marshal’s sale on 11 December in Orfolk, where she had been seized by
her creditors, and the Amco Voyager was sold in federal court in Baltimore on 14 December. The Amco Voyager was bought for $501,000 by Steamco, a New York-based marine engineering and contracting firm. The Amco Trader was acquired by Steamco for $421,000. Steamco operates in New York, Texas, and Florida, and held the first mortgage of $841,500 on the Amco Voyager. It intends to place the Amco Trader in the Norfolk Shipbuilding and Dry Dock Company yard.for repairs, but has no plans to operate the ships on a long-term basis. Bareboat charters for the two ships are being sought by Jacq. Pierot and Sons, Inc., brokers for the owners.
AMCO began operations in October 1982, when it was the lowest bidder for military cargo moving between North Atlantic ports of the United States and Bremerhaven. Subsequent offers for military cargo were undercut by United States Lines and Sea-Land Service. As allocated by MSC, 75% of the cargo was reserved for the lowest bidder, and 25% for the second lowest. Lacking this basis for its operations, AMCO had difficulty surviving.
American President Lines (APL) was authorized by Mar Ad on 12 April 1984 to purchase the 23-knot Neptune Garnet and Neptune Jade from Neptune Orient Line, of Singapore. Built in Japan in 1980, these diesel-powered ships carry the equivalent of 2,522 20-foot containers, including 400 40-foot refrigerated boxes. Acquired for $29 million each and renamed President F. D. Roosevelt and President Eisenhower, the vessels were assigned to Tacoma Boatbuilding and a Japanese shipyard, respectively, for modifications required to bring them up to American standards and to fit them for enrollment in the government’s Sealift Readiness Program. Following negotiations with six maritime labor unions, the manning scale was fixed at 21 men. According to APL president Bruce Seaton, the saving in wages, compared to the 31- man crews of the smaller ships that were retired, is about one million dollars per ship per year.
Asserting that the company does not agree that “an adversarial relationship must exist between seagoing labor and management,” APL in October set up a committee representing union and management to deal with any issues that might arise as seafarers adjusted to the new manning scale. The company also instituted technical training programs to make its seamen more productive.
When the President F. D. Roosevelt was integrated into the company’s opera-
The tanker Exxon Baytown was one of the few merchant ships completed by a U. S. shipyard in 1984. Only the busy Navy shipbuilding and conversion programs have been of substantial help to U. S. yards.
tions in December, APL announced that a new schedule, effective early in 1985, would offer weekly sailings from the West Coast to Hong Kong, with transit time shortened to 15 days from the previous 19. This resulted in part from the availability of five ships with 23-knot speed and the highly-efficient, singleoperator terminals opened by APL in Los Angeles and Yokohama. The 115-acre, $60-million marine terminal in San Pedro was dedicated on 24 May 1984, and the Yokohama facility was opened on 29 November. Said to be the largest singleoperator terminal on the Pacific coast, the installation in San Pedro has wharf frontage of 1,800 feet and four 40-ton Hitachi- America container cranes, as well as a computerized gatehouse system that weighs containers and determines to which of the 3,800 parking slots the trucks are to proceed. Refrigerated containers can hook up their units in 440 slots. A special feature is onshore fuel tanks that deliver fuel by pipeline directly to the ships, eliminating customary barging operations.
In mid-April 1984, APL began moving containers twice each week from Los Angeles to Chicago and New York, using specially-built, light-weight railroad flatcars that permitted stacking containers
designer and builder of oxygen generators for submarines
TREADWELL CORPORATION, 85 OXFORD DRIVE, MOONACHIE, N. J. 07074
two high. Each unit train was loaded with 200 containers. In July a third train, working from Seattle to Chicago and' New York, was put into service, followed by the fourth and last train in October. Participating railroads are Union Pacific, Chicago and Northwestern, and Conrail.
The Berger Group: In December 1983 the Maritime Administration (MarAd) ruled that Acadian Shipping Corporation, prospective owners of the Atlantic Bear, could operate in all domestic trades except to Puerto Rico and Hawaii. The ruling was required because the corporate parent of Acadian Shipping, the Berger Group, operates a number of bulk carriers receiving operating differential subsidy. Affiliates of Acadian Shipping protested, but the ruling was retained. On 16 February 1984 Acadian was given approval “in principle” for a guarantee of the loan needed to buy the Atlantic Bear and to recondition her for domestic service under the new name of Atlantic Spirit.
A notice of public sale by U. S. marshals of the Atlantic Bear ran in the Journal of Commerce on 22 May 1984 for the northern district of California and the eastern district of Virginia. The California marshal was involved because the Atlantic Bear represented an asset of the bankrupt Pacific Far East Line, of San Francisco. The sale was to be on 4 June in Norfolk. On 9 June MarAd disclosed that it had paid $17.5 million for the ship, and that Acadian Shipping had a conditional contract to purchase the vessel for $21.8 million, plus whatever it might cost to put the ship into operation. MarAd guaranteed up to 87.5% of the mortgage needed for purchase. It was not until 14 September that the sale of the eight-year- old, roll-on/roll-off ship, now known as Atlantic Spirit, was effected. Reconditioning the 790-foot vessel brought the total value of the mortgage insured by the government to $33.4 million. No news of the award of a contract for upgrading the ship or of her entry into service was published before 31 December.
Berger was again in the news on 29 May, when the 64,000-ton, Korean-built, American-flag bulk carrier Aurora, on her first voyage, loaded grain for Haifa at the Cargill terminal in Houston. Owned by Aeron Marine, the Aurora filled the gap in that company’s fleet caused by the loss in 1983 of the Golden Dolphin, an American-flag bulk carrier. The ship’s commercial and agency activity will be handled by Zim-American Israeli Shipping Company, thereby activating a partnership between Aeron Marine and the affiliate of Zim, the Israeli shipping complex, and introducing Zim-American to U. S.-flag shipping.
Crowley Marine Corporation was active on all U. S. coasts during 1984, pr>- marily as the operator of tug-barge combinations. Trailer Marine Transport (TMT) maintained service between Florida and Puerto Rico with three 400-foot, roll-on/roll-off barges and accompanying tugs. On 23 July, TMT contracted with McDermott Shipyards, of New Orleans, to lengthen these barges by inserting new midbodies, each 330 feet long. The work was done in McDermott’s three yards- Gulfport, Mississippi, and Morgan City and New Iberia in Louisiana.
Crowley won the contract for the 16th consecutive year to haul supplies to the Alaskan “North Slope” oilfield during the summer. Eleven large barges, eac 400 feet long by 100 feet wide, and si* tugs, each powered by 9,000-brake- horsepower diesel engines, were assembled in Puget Sound after being loade with an aggregate of 29,800 tons 0 cargo. The convoy sailed on 15 July- bearing vitally-needed items for Standar Oil Company (Ohio) and Atlantic Richfield Company. ,
The fleet of tugs and barges include the icebreaker barge Arctic Challeng^r’ which is strengthened for pushing through ice and has two stern notches into which the 9,000-horsepower tugs can n if the ice is especially tough. Normally one tug is adequate, but experience has shown the wisdom of having ample capa" bility. Light reconnaissance planes be longing to Crowley and based at P°in Barrow made several flights each day t0 scout ice conditions along the tcn-fath0111 line offshore and to discover ice leads in more distant areas.
Delta Lines, a Crowley subsidiary- brought one controversial issue to a con elusion in 1984, was involved in a pr° traded dispute with the International Longshoremen’s Association (ILA), an was the target of a buy out which waS under negotiation as the year ended. _
Carried over from 1982 was Deha s proposal to MarAd that its operating d> ferential subsidy contracts covering services and 24 ships end in 1987 rath than running to their termination in 1" " and 1997. In exchange. Delta sought “buy out” payment of $595 millionsetting that this was less costly than if1( contracts ran to full term. Signified opposition from industry, labor unions- and congressional groups was encoun tered, and questions were raised concert^ ing MarAd’s legal authority to agree
1985
e to construct three containerships, c able to lift 2,000 20-foot containers
e proposal. The issue was kept alive rough the 98th Congress without defin- action being taken. On 17 December a brief and inconspicuous note Ppeared in the Journal of Commerce at>ng that “Delta had, without explana- ‘°n, about Oct. 19, asked that its pro- th°Sa* ' ' • withdrawn.” Nothing fur- er was released by 31 December.
J i e^a Line Put the Santa Rosa into Jacksonville on 9 April 1984, anchored yards offshore. This precipitated a Prolonged dispute with the ILA. Earlier n . year, the New York Shipping Asso- jatlon (NYSA), the negotiator for em- Poyers of longshoremen in 36 Atlantic n Gulf ports except Jacksonville and a*e Charles, Louisiana, had agreed to a aster contract. Delta affirmed that it had 'thdrawn from the NYSA before the agreement became effective, and not vav,n8 s'gned it was not bound by its pro- ls'ons. As a demonstration of its independence of both NYSA and ILA, Delta the Santa Rosa’s cargo worked by ^erniinal Operators, a Crowley subsidi- ry which employs members of the Inter- atl°nal Brotherhood of Teamsters, ater in April, Delta announced that its
and>S W0U^ ca'* on‘y at Lake Charles,
C that its stevedoring would be per- thr^ed by 3 Crowley affiliate. Although j e ^ protested, Delta moved its ships and out of Lake Charles without inter- Ption. The ILA did file a number of o >ts against Delta, but no compromises ^chedules for trial had been reported y 31 December.
o P*1 a minimum of detail. United 0ates Lines (USL) let it be known on 31 and°^er *^at wished to buy the ships fro °Perat'n8 contracts of Delta Line Tj'lrn Crowley Maritime Corporation. lioe terms of the sale included $36.6 mil- n worth of McLean Industries stock, gumption of $12.5 million of debts, and ^Possible revenue-sharing arrangement 'tn Crowley Maritime. USL did state CyS,tively that only the ships and subsidy ntracts were involved, plus an agree- ,a]Cn< to charter three Danish-built con- j^ aerships as they were delivered to t()e ,a’ starting in late December. The in rP°rate structure of Delta Line was not trC Uc^e(l in the transaction. As part of the ansaction, which was concluded in Jan- ha/ Crowley announced that it
no intentions of using the Delta name Ho ln’ S° ^ormer shipping line may ^ be considered dead, in iQlta rece‘ved authority from MarAd y ^3 to build up to ten ships in foreign trar S IJs‘n8 this authority, Delta con- truTlf^ W'1^ 3 shipyard in Odense, Den
(including 250 refrigerated boxes). The 643-foot-long ships are equipped with two gantry cranes to be fully self-sustaining in any port or anchorage. The Sea Wolf, first of the class, was expected to arrive in New York in December but had not been reported when the year ended.
Delta Line was one of the last operators to run passenger ships on regular year-round schedules. The company announced early in 1984 that it would terminate this service by year’s end. The Santa Mariana made her last departure from Los Angeles on 6 September, the Santa Magdalena sailed on her final voyage on 27 September, and the Santa Maria left on her terminal trip on 18 October. All three ships were laid up in San Francisco by 12 December.
Lykes Lines emphasized the transpacific trade during 1984. It purchased four ships, each fitted to carry 1,100 20-foot containers, from West Germany’s Hapag-Lloyd. After appropriate upgrading to meet U. S. requirements, the ships were transferred to American registry. Todd Seattle was the beneficiary of the $9.5-million contract to refit the Elbe Express (renamed Margaret Lykes) and the Ulster Express (now the Sheldon Lykes). The Weber Express (which became the Charlotte Lykes) went to Mitsubishi, and the Mosel Express (now the Adabelle Lykes) was allocated to Mitsui, in Japan, for the required modifications. All four acquisitions were in service by 1 September.
To modernize and make its fleet more competitive, Lykes arranged for bank loans, guaranteed by MarAd, of $61.5 million. Twelve of the Gulf Clipper-dass ships were refinanced to the extent of $14 million, $2 million was invested in refrigerated containers, and $21 million went into the construction of container chassis. To acquire shipboard equipment, an allocation of $15 million was made. The $9.5 million to refit the Sheldon Lykes and the Margaret Lykes was part of the financial package. As collateral for the loan, Lykes pledged 15 ships and 246 barges.
The announcement concerning the loan was made on 16 July. Only 11 days later, Lykes received authority from MarAd to charter two idle breakbulk cargo carriers to the Military Sealift Command (MSC) for one year, with option to renew for three additional years. One week after the release of information on the charters, MarAd approved the sale of 13 breakbulk ships to the Navy for $21 million. The vessels were assigned to MSC, and the operating differential subsidy contracts covering them were terminated.
Lykes contracted with a joint venture of Mitsubishi Heavy Industries and Mitsui Engineering and Shipbuilding Company to construct four containerships, each intended to accommodate 2,500 20-foot containers. The contract was signed on 19 July, and represented an investment of $152 million. On 9 September, Lykes announced that it was ordering two more of these ships at a further cost of $76 million. Delivery of the 36,762-ton ships is scheduled for 1986. All six vessels will be assigned to the transpacific service; the German ships purchased earlier in 1954 will be transferred to the U. S. Gulf, from which Lykes has operated for decades.
Matson Navigation Company, an unsubsidized operator, initiated a major cost reduction program in 1978. A company survey of progress through 1983 attributed the program’s success to a combination of scientific and engineering equipment and persistent management attention to detail. Significant elements were: self-polishing copolymer hull paint, micro-computers to assure optimum combustion efficiency, slower steaming speeds, improved cargo handling techniques that shortened port turnaround time, loading ships so that they sailed with even-keel drafts, satellite navigation, and a “weather accountability program” to assess the impact of adverse sea and wind conditions on fuel consumption. An ongoing conservation effort cut fuel consumption by 30% in 1983, which translated into a savins of $5.6 million.
Pioneering in another area, Matson was the first shipowner on the Pacific Coast to appoint a woman as chief officer of one of its big containerships. Mrs. Lynn Korwatch, daughter of a seafarer, graduate of California Maritime Academy, and wile of a seagoing engineer, was assigned to the Lurline in late 1983 after seven years of service aboard Matson ships.
Two new barges were purchased for the intra-island service maintained by Matson. McDermott, Inc., of New Iberia, Louisiana, delivered the barges in late 1984 at a cost of nearly $6 million. They are 350 feet long, 64.5 feet wide, and have a full load displacement of 6,859 tons. The Haleakala was christened on 21 September and the Mauna Loa on 19 October. Both were towed to Honolulu and arrived early in January 1985. The barges have a capacity for 216 containers and 1,800 tons of molasses in bulk. They are to be fitted with a new type of revolving crane built by Mitsui in Japan to facilitate loading and unloading
the containers, and also will have a radio- controlled stern thruster to assist in docking operations.
The roll-on/lift-on-carrier Lurline spent six weeks of the summer in the Tri- ple-A Shipyard, of San Francisco while her steam engines were modified to improve their fuel efficiency. In addition, the after deck was altered to make room for 39 more 40-foot containers. The cost of these improvements was about $2 million.
On 17 December, John C. Couch became Matson’s president. He had been executive vice president and chief operating officer. R. J. Pfeiffer remains chairman and chief executive officer.
Navieras de Puerto Rico, the trade name of the Puerto Rico Maritime Shipping Authority, a steamship company owned by the commonwealth government, operated two services during 1984. From New Orleans every Friday a ship sailed directly to San Juan, and from Jacksonville, as of 8 May, another ship set out for San Juan via Charleston, South Carolina. In addition, the enterprise kept three smaller roll-on/roll-off vessels in feeder service from Haiti, Dominican Republic, Virgin Islands, and Trinidad- Tobago to San Juan, where their small cargoes were consolidated for onward carriage to the mainland. These feeder ships have bow thrusters and shallow draft, and can enter almost any port in the Caribbean.
Effective 7 August, Navieras joined with Interline Connecting to provide twice-weekly roll-on/roll-off sailings from San Juan to the Leeward Islands. Interline Connecting is a joint venture of Vertom Shipping, of Rotterdam, and Tramar Shipping, of Miami. Interline operates three roll-on/roll-off vessels, each able to carry' standard 20- and 40-foot containers as well as 30 truck trailers.
Owing to an eight percent increase in ocean freight rates, Navieras reported a net profit for February and March 1984 of $1.2 million. In December, however, opponents of the company claimed it was bankrupt. This was denied by the outgoing executive director, who nevertheless recommended a reorganization plan to lower crew costs and to provide for proper capitalization as well as fleet modernization.
Appointed by the incoming governor of Puerto Rico, replacements for senior executives of Navieras took office on 1 January 1985 facing significant problems. The most recent reports indicated the company would lose $50 million by the end of its fiscal year on 30 June 1985.
Navieras’ share in the movement of goods dropped from 80% in 1974 to 55% in 1983.
Rainbow Navigation, Inc. On 28 February 1984, Rainbow Navigation, Inc., of Red Bank, New Jersey, announced it would start an unsubsidized, American- flag service from Norfolk to Keflavik, Iceland. President Mark Yonge was quoted on 6 April as saying that “this is strictly a commercial operation,” and that Rainbow did not have a contract to carry military cargo.
The 2,200-ton motorship Rainbow Hope, bareboat chartered from MarAd for $1,500 per day, made her first departure from Norfolk in April and continued regular sailings at 25-day intervals throughout the year. Voyage number ten was scheduled to begin on 27 December.
Keflavik is the site of a large NATO base to which the United States sends a substantial tonnage of military cargo. Until the advent of Rainbow, this moved in the ships of two Icelandic companies, Hafskip, Ltd. and Iceland Steamship Company. By law, when an American- flag carrier was available the military cargo had to be offered to that operator. According to the Icelandic companies, about 75% of the military cargo now is transported by Rainbow.
Rainbow Navigation has not published the names of its backers beyond stating that Housing Transport International, of Red Bank, is a minority shareholder. Mr. Yonge is president of this company as well as of Rainbow Navigation.
Sea-Land Service, Inc., a billion-dollar subsidiary of R.J. Reynolds Industries, Inc. since May 1969, was divested by the corporate parent on 16 February 1984. The company had assets on that day of 40 line-haul ships serving 56 countries, 19 feeder vessels, and an inventory ot 90,000 containers. Trading in Sea-Land stock began on the New York Stock Exchange on 15 May at an opening price of $17.38 per share. The spin-off was completed on 19 June, when 22.7 million shares of Sea-Land’s common stock were distributed to approximately 107,000 Reynolds stockholders. On 18 July, Sea- Land reported that the first six months of 1984 had been the most profitable in its history. Net earnings were $40.9 million, or $1.76 per share.
A program to enlarge its D-9 contain- erships was announced in April. Contracts for this work were awarded to Mitsubishi Heavy Industries, Ltd., of Japan, and stipulated that new midbodies were to be inserted in the 12 ships of this class. The enlarged ships will be able to carry 1,236 40-foot boxes, compared to their previous limit of 904 containers. Approximately one year will be needed to complete the modifications on all ships.
To modernize its fleet sailing 10 Alaska, Sea-Land contracted on 22 October with Bay Shipbuilding Corporation- of Sturgeon Bay, Wisconsin, to build three diesel-powered containerships' each able to transport 700 40-foot containers, or a mix of 20-, 35-, and 40-fooj boxes. The 10,000-ton ships, which w» cost $60 million apiece, will increase Sea-Land’s capacity in the Alaska trade by 46%. They will be 710 feet long, 7® feet wide, and draw 30 feet of water. The 20-knot vessels will carry refrigerate containers below decks, and an “innovative” system of securing containers on deck will be installed. The first keel wi be laid in July 1985, with delivery set lor August and November 1986 and May 1987.
Sea-Land disclosed on 30 October tha it was designing six big containerships to be built for its transpacific trade. These ships will be designated as D-17s and wt have space for 1,700-1,800 40-foot con tainers. Contracts for construction are to be let early in 1985, and delivery is eX pected in 1987 and 1988.
United States Lines (USL) commenced its around-the-world service on 3 Decem ber 1984 when the American Ma‘ne sailed from Singapore to the Panama Canal, north to Savannah and New Yor • thence to Rotterdam and into the Med1 terranean, through the Suez Canal to me Middle East and Southeast Asia to com plete the loop in the Far-East. More spL cific information as to the ports of ca had not been released when the voyage began. Called “Sea Bridge,” the service is advertised as “to or from anywhere in Europe; North, Central, and Soot America; South and East Africa; Midd e East; Southeast Asia, Far East; Guam- and Hawaii. Only 12 “load center” P01'1, will be visited. On 4 December, MarA^. authorized USL to set up a system 0 small foreign-tlag feeder ships to efte delivery and collection at 32 other ports ■ This feeder system was authorized on ; for two years. Justification for continua tion must be filed by 1 October 1986-
Initially, USL plans one sailing of 1 big ships every two weeks, but as fleet is increased by deliveries ot eight ships still under construction 7 Daewoo Shipbuilding and Heavy Ma chinery, Ltd., of South Korea, the tf quency will be changed to weekly- first of these 12 big ships, the America^ New York, arrived at Staten Island maflU terminal on 30 July and was greeted -
1985
[he mayor of New York and the vessel’s 0»o"rS' S^'P's 949 feet, 10 inches u°9-5 meters) long, 106 feet (32.218 peters) wide, and has a summer draft of feet (10.67 meters). Diesel-propelled y Sulzer slow-speed motors with a nor- j*la output of 25,000-brake-horsepower, e ships can cruise at 18 knots. Every Member of the 21-man crew has a private t°om. Cellular construction provides for 'a “^9-foot containers below decks, ^ ^97 on deck, including 146 refrigerated boxes, for a total of 4,482 20-foot equivalent units (the standard measure for e°ntainerships).
The worldwide service depends upon ®^der ships. The subsidized Delta Lines, tch served both coasts of South Amer- Was purchased in early January 1985. sls. Save U. S. Lines American-flag „erv'ce around South America, making °ntact with the round-the-world ships at anama. No action by MarAd had been pH as the year ended.
Entry into the round-the-world service y USL was not universally approved. e§al action was commenced in Decem- er by Farrell Lines, Prudential Lines, n<J Sea-Land Service, which filed suit gainst the Maritime Subsidy Board to Pr°jest the decisions since 1981 by which j. “ Was permitted to return to subsi- ■zed operation for a five-year period. Is was accomplished when USL pur- ased some of Farrell Lines’ operations, J'd when USL absorbed Moore-McCor- eac^ >n January 1983. The possibility x,sted that decisions made on 4 Decem- er 1984 by the Maritime Subsidy Board o.ncerning the use of foreign-flag feeder 'Ps might be challenged, thereby ^catening the structure of USL’s world- c 'de service. No dates for hearing these ases had been set at year’s end.
Waterman Steamship Company, which ed for protection under Chapter 11 of Coe bankruptcy Act on 1 December 1983, ntinued its liner-service operations dur± E 1984 on a significantly reduced scale, s °f 8 April 1984, MarAd had paid over million to holders of mortgages guar- ^njeed by that agency. Waterman sold the 1,1 fi. Waterman and the Thomas Hey- ,^rd to Wilmington Trust Company, act- v§ as trustee for Beatrice Financial Ser- c,Ces> Inc. Both ships have been artered by MSC as part of the forward ^Positioned supply fleet. The lighter ^ <>a,h ship (LASH)-type Robert E. Lee, Houston, and Stonewall Jackson r° retained by the company for com- emial service on its subsidized trade ^Ute; the Edward Rutledge and Benjamin arrison were laid up.
Specialized Ships
Home-ported in New York, the American heavy-lift ship Dock Express Texas made her first visit to that city on 4 May. She loaded two electrical generator stators, each weighing 195 tons, and one weighing 280 tons for delivery to Mexico. The ship is equipped with a pair of booms which together can hoist 320 tons; singly they handle 160 tons. She also has a ramp with weight-bearing capability of 1,000 tons. She was built in Holland in 1977, but in 1982 capsized and sank in New Orleans. A constructive total loss, the hull was raised and taken to a shipyard in Mobile, where it was rebuilt and renamed by Dock Express Contractors, Inc., of Houston, general agents for the Dutch corporate parent. The Dock Express Texas is one of the few heavy-lift ships registered under the American flag. On 7 November, a news dispatch from Detroit stated that the Dock Express Texas was to sail for Tunis, Tunisia with a load of 39 tanks weighing 48 tons each.
Two ships designed to burn hazardous wastes at sea have been built by Tacoma Boatbuilding Company in limited partnership with Captain Leo V. Berger, the East Coast shipowner. When construction was begun it was expected that the ships would be leased to Apex Marine, one of the Berger Group companies, and the incineration operation would be conducted by At-Sea Incineration, a subsidiary of Tacoma Boatbuilding. The ships were to load their cargoes in Lake Charles, and proceed about 150 miles into the Gulf of Mexico. Great opposition was encountered from environmental protection groups, and plans for putting the ships into service were held in abeyance. Experimental voyages by a Dutch ship, Vulcanus I, which performs the same functions, also were severely restricted by U. S. authorities until late in the year.
The incinerator ships, to be named Apollo One and Apollo Two, cost $74.5 million, of which MarAd guaranteed $55,875,000. Two furnaces are to consume the wastes at temperatures of 2,350 degrees Fahrenheit. Each load of 1.3 million gallons will require about ten days to burn; combustion is expected to be 99.9% complete. If obstacles can be overcome, the burning process should start in the summer of 1985, according to Rockney A. Nigrette, project manager for Tacoma Boatbuilding.
Apollo One was christened and launched at Tacoma’s yard on 20 February. She is 369 feet long, has a 60-foot beam, and draws 23 feet, 6 inches of water. A pair of 1,150-horsepower die-
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Breeze cables are field proven-on board the Navy's Phalanx CIWS, the Tomahawk missile and the Harpoon system, to name a few. Breeze products are qualified to S9407-AB-HBK-010 (formerly NAVSEA 0967-LP-283-5010) ond are pending qualification for MIL-STD-1310E.
CONWAYS ;
CONWAYS
AILTHEWORI-'W
. a basic reference for any study of combat vessels of the past 120 years. Those who have not yet made the acquaintance of Conway's should do
SO nOW.” - Warship International
1947-1982
authew*lds
FICHTOfC
CONWAYS
sels in a completely automated engine room are connected to twin screws. A complement of 25, including eight environmental protection agents and scientists, can be accommodated. She was scheduled for completion and delivery during the summer of 19S4, but at year’s end there was no indication that the ship would be authorized to operate.
The bulk carrier Archone began operating under the American flag in July. Built for joint ownership by Crowley Maritime Corporation and Apex Resources (a Berger Group affiliate), of New York, the 938-foot, 63,463-ton ship cost $21.5 million to build in Korea— approximately one third of the price in a U. S. yard. Her first employment was to carry 53,700 metric tons of grain from Portland, Oregon, and Vancouver, Washington, to Egypt.
Passenger Cruise Ships
Passenger cruises, especially from Miami, have become very big business. Several Caribbean islands depend heavily on cruise passengers to earn needed dollars. Puerto Rico, because it is an American commonwealth, is affected by cabotage laws that bar foreign-flag vessels from transporting passengers or cargo
A.LL IALLi
nCljTINO FICHTiy from the mainland to the island. It has been Puerto Rico’s contention that it is deprived of a lucrative source of revenue by this restriction, and the island government has urged that it be lifted insofar as the mainland-Puerto Rico passenger business is concerned. On 31 October, President Reagan signed a bill that grants Puerto Rico’s request, despite the objections of the American-flag steamship industry. Only one inquiry from a foreign operator had been received at the end of 1984 by the U. S. Customs Service, which will administer the new law.
Cruise America Line, Inc., of Fort Lauderdale, Florida, failed again to have legislation enacted that would permit two foreign-built passenger ships to be registered in the United States and receive full domestic trading privileges. The bill supported by Cruise America was opposed very strongly by both American shipbuilders and by shipyard workers unions, who feared that this weakening of the cabotage law (sometimes referred to as the “Jones Act”) would doom American commercial shipbuilding.
Adventure Cruise Lines, Inc., of Miami, applied to MarAd on 30 December for insurance for a construction loan and mortgage to finance a 570-passenger cruise ship to visit Florida ports. The cost
CONWAYS 1947-1982 was estimated at $24 million; no shipyar was named as builder.
Once the speed queen of the North Atlantic and flagship of United States Lines, the superliner United States was in the news a number of times during 1984- Now owned by Richard Hadley, a rea estate developer in Seattle and Honolulu- the vessel is to be converted into ‘ the best cruise ship in the world”—if financing can be arranged for the $140-milli°n project. In January 1984 Norfolk Shipbuilding and Drydock Company announced that it had received a telegram from Hadley stating his intent to start work, contingent upon completion of financing details. Only a portion of the conversion was to be performed by Norfolk; most of the reconstruction was to be carried out by Howaldtswerke Deutsche Werft AG, of Hamburg, West Germany- An auction of all the furnishings of the big ship, including table settings an lamp shades, was held in Norfolk frorn 8-14 October.
Morgan Stanley of New York is han dling American bank involvement in mL project. Two banks in Frankfurt, Wes Germany, are the leaders for the financ ing project. The Bonn government in sisted upon a feasibility study of the Pr° posal. Temple, Barker and Sloan. ° Lexington, Massachusetts, completed the
requirement and submitted its 70-pa?e report in October for assessment by a firm of West German accountants. Neg0^ tiations also were in progress to guarantee the financing through Hermes Kred'1 versicherung of Hamburg and West Ber lin. Hermes is reported to be “dragg'11^ its feet” because the risks of operating the ship are “formidable.”
John Cox, of San Francisco, a veteran ship’s officer and shoreside executive, was named senior vice president foroper ations of United States Cruises, owners of the ship, on 24 October 1984. Mr. will be the master of the United StatLS when she comes into service. .
Although final details concerning Ji nancing the project were expected to completed by 31 December, the ended without a definitive statement. 1 ship remains at her berth in Norfolk-
Maritime Academies
NAVAL INSTITUTE PRESS BOOKS
(Use order form in Books of Interest section.)__________________________ ,
List Price: $38.95 - Member’s price: $31.16 each
1860-1905 | 1906-1921 | 1922-1946 | 1947-1982 | 1947-1982 |
440 pages | 450 pages | 456 pages | Part I: The | Part II: The War |
900 illus. | 950 Ulus. | 994 illus. | Western Powers 298 pages/520 illus. | saw Pact and Non- Aligned Nations 256 pages/490 Ulus. |
Maine Maritime Academy announc*- on 15 May that Rear Admiral S- ' Swarztrauber, U. S. Navy (Retired). na^ been chosen to succeed Rear Adm*
E. A. Rodgers, U. S. Maritime ServWe’ as superintendent. Admiral Swarztrau is a graduate of Maryville College. Tennessee, the Navy’s General L' School, and holds a doctorate in intern
tional studies from American University, in Washington, D.C.
Maine Maritime is initiating a program of graduate study in maritime management. Courses are modular, last three and a half weeks, and hold classes five days each week. Over a period of two or three years, the student will be able to complete the required seven of ten modules offered. The first class attracted 12 students. In 1985 four modules will be offered; in 1986 the basic four will be supplemented by four more; and in 1987 the remaining two modules will be available. The faculty is recruited from universities during their summer vacations. In 1984, Leslie Kanuk, former chairman of the Federal Maritime Commission and now professor of marketing at Baruch College, in New York, and David H. Moreby, head of the School of Maritime Studies at Plymouth Polytechnic, in Devon, England, were among the teachers. The program for 1985 will begin on 6 May.
Massachusetts Maritime Academy replaced its fire-damaged schoolship with the rebuilt Santa Mercedes (renamed Patriot State), which was purchased by MarAd for $4.2 million. Space for 600 cadets and instructional personnel plus classrooms and related educational facilities was provided by the reconstruction.
MarAd, reacting to the reduced demand for seafaring deck and engineer officers, cut the number of students enrolled in the state maritime colleges who receive federal support funds from 640 to 580. The U. S. Merchant Marine Academy similarly was authorized to matriculate only 242 students in the class which entered in August 1984. In 1983, the class was restricted to 271.
Stating that naval officers of the future must have an understanding of amphibious warfare, U. S. Marine Commandant General P. X. Kelley assigned a Marine captain to the Department of Naval Science at the federal academy in November. He also appointed a staff sergeant as drill instructor for the regiment of midshipmen. The Marine Corps has a continuing interest in the qualifications of Academy graduates, since a number are commissioned in the Corps each year. In 1984, ten graduates were approved for appointment as Marine second lieutenants.
Led by Captain Robert Meurne, head of the Department of Nautical Science, six midshipmen from the federal academy spent two weeks at Great Britain's College of Maritime Studies at Warsach, undergoing training on that facility’s unique ship’s bridge simulator. Three of the Kings Pointers had taken the
Academy’s course in shiphandling at the Computer Aided Operators Research Facility, located at the academy. The other three did not have that background, and were chosen to ascertain the effectiveness of the two training programs. Instruction at Warsach was supervised by Captain Richard Beadon, principal lecturer at the Ship Simulation Center.
Maritime Miscellany
- Originator of container shipping and chairman of McLean Industries, parent of United States Lines, Malcom McLean was awarded the Admiral Of The Ocean Seas trophy for outstanding contributions to the American merchant marine.
- G. P. Livanos, president of Seres Shipping Inc., received the Halert C. Shepheard Award for achievement in merchant marine safety. Mr. Livanos and his business associates designed a revolutionary method of abandoning ship based on the principle of ejection capsules.
- The tanker Exxon Connecticut was cited by the American Institute of Merchant Shipping and the Marine Section of the National Safety Council for 13 consecutive years of operation without an accident that resulted in lost watch-time by crew members.
- The Panama Canal was declared an international Civil Engineering Landmark by the American Society of Civil Engineers. A bronze plaque in the rotunda of the administration building of the Canal was dedicated on 8 November.
- Eight liquefied natural gas (LNG) carriers—U. S.-built, U. S.-registered, and carrying complements of 31 each—were chartered for 25 years at a good rate to Burma Oil Company to transport LNG from Indonesia to Japan. The fleet is owned by Energy Transportation Company, of New York. All eight ships were built by General Dynamics at a contract price of about $90 million each. Replacement costs in American yards are estimated at $250 million; in foreign yards, about $150 million.
- American Telephone and Telegraph Company’s subsidiary, Transoceanic Cable Ship Company, purchased a cablelaying ship for $7 million from Fratelli d'Amico, of Italy. Extensive refurbishing, requiring about a year in the Tracor Shipbuilding yard and costing about $6 million, was commenced in January. The ship will be based in Honolulu.
- The General Accounting Office concluded that “no compelling reason” exists for the federal government once again to provide direct medical and hospital care for American merchant seamen.
- In 1984, the annual average of seagoing jobs dropped to 15,400 fr01** 17,710 the preceding year. About 44,000 seafarers were employed to fill these job slots.
- United Seamen’s Service rededicated its Bremerhaven center in December. The renovation cost $350,000 and was accomplished without closing down any 0 the center’s activities.
- American owners had a total of 52-> ships (334 tankers, 105 dry bulk carriers, and 86 other types) under 22 foreign flags, according to a 1 July 1984 comp1' lation by the Maritime Administration.
- The National Maritime Union (NMU) announced on 10 October that it woul seek legislation to extend U. S. minimum wage, safety, and civil rights laws, 3s well as the National Labor Relations Act, to foreign-flag ships catering primarily to the American cruise market. The union also is to train unemployed youth in Miami for shipboard jobs. The program will be financed by the Labor Depart ment’s Job Corps, but administered by NMU.
- Ayer Company, Salem, New Hamp shire publishers, have brought out a mon umental re-issue of The Historic Am<?r‘ can Merchant Marine Survey. seven-volume work contains 1,009 seal drawings of 360 ships, 198 photographs’ and 49 sketches. Originally compiled as a Works Progress Administration (WrA) project in 1936-37, the Survey has Ion? been out of print. Only 300 sets have been printed; the retail price is $3,00 ■ Because the WPA project was ended ab ruptly, only wooden-hulled vessels arc included.
Colonel Kendall is a recogni?c _ expert on the U. S. me. 0„ marine; he has been writing the subject for the Proceeding since he was a second 1 iciitciro^ in the 1930s. He has worked ^ the commercial shipping >nl u try, been on the faculty 01 ^ Merchant Marine Academy ^ Kings Point, served as a senl staff member of the MilU3^ Sea Transportation (now Military Sealift Co mand), and was the 1975 wl,s ner of the Naval Institute award of merit as an author-