Container-on-Barge Pre-Feasibility Study Final Report - Towmasters ...

Initial Assumptions:
1. Freight traffic in the U.S. is expected to double in the next twenty years, placing
excessive demands on existing road and rail infrastructure.
2. COB is a highly successful alternative for road and rail freight movements in Europe,
the Pacific Northwest, and other places in the world.
3. COB is technically feasible, economically attractive and environmentally
advantageous for the Ohio-Mississippi River System.
4. COB could utilize existing jumbo barges, holding 72 TEU containers (stacked 3-
high), and existing river terminals that have 25 ton plus cranes and storage capacity
for 180 containers in order to initiate service.
Shipper Identified Obstacles to COB Traffic on the Inland Waterways:
1. The Chicken and Egg Syndrome. <strong>Container</strong> shippers are reluctant to commit cargo for
a service that the barge lines do not offer on a predictable, regular and reliable basis, with
point-to-point rates. Barge lines are reluctant to commit barges to a service without the
guarantee of sufficient cargo.
2. Historical Perspectives. Previous failed COB attempts have convinced some skeptics
that it is impossible to do COB on the Ohio-Mississippi system, but the failures may have
been due to specific business problems. The previous attempts on the lower Mississippi
were hampered by cut-rate rail competition in an extremely competitive north-south rail
network that parallels the Mississippi River; the lack of deep pockets to withstand such
competition; the lack of experience in dealing with unique container handling
requirements; and, for both the Mississippi and Ohio systems, the dependence on single
shippers who may change their supply chain logistics requirements for other business
reasons.
3. Complex Research and Operational Organization. Efficiencies of scale indicate 72
TEU containers could be organized and staged together at one time for one destination to
minimize time-consuming, multiple stops and possible re-stowage of cargo. Identifying
the shippers and organizing the COB service is a complex problem and needs to be done
at both ends of the system (Pittsburgh and Brownsville) as well as other ports that wish to
participate. Identifying the potential customers in the U.S. for inland ports will be more
difficult than for ocean ports since the utility of PIER data is less applicable. Identifying
potential customers in the Mexican market, where there is less familiarity with barge
transportation, will require extensive personal contact.