Office of Naval Research - National Transportation Library

economies within the corridor are the large volumes of chemicals and petroleum andheavy loads of crude minerals and raw materials, the core commodities for SSS market.The hazardous nature of the cargo and the typical loads that exceed highway weight andsize limits and/or cause excessive pavement wear & tear, and therefore higher costs fortruck shippers provide the needed volume commitments to support reliable SSS serviceschedules. (Table 6)Table 6 – Comparison of Truck, Rail, and SSS Service(Gulf to Atlantic Coast Corridor)Performance Truck Rail SSS(StatusQuo)SSS (Bestin-Class”Total Miles (Door-to-Door) 1,470 1,699 2,091 2,091Transit Hours (Door-to-Door) 67.5 86.0 111.0 111.0Carrier Cost per Highway Mile ($) $1.64 $0.87 $099 $0.89Operating Margin 10% 30% 10% 10%Shipper Cost per Highway Mile * $1.77 $1.06 $1.13 $1.03Differential: SSS Shipper Costs- -40% -36% -42%Compared to Truck Shipper Costs**Source: Global Insight, “Four Corridor Case Studies of Short-Sea Shipping Services: Short-Sea ShippingBusiness Case Analysis”, submitted to the U.S. DOT, Office of the Secretary, in association with Reeve &Associates, August 15, 2006.* Shipper costs include any “markup” or profit margin added to the carrier’s costs, as well as incrementalinventory carrying costs incurred by slower transit times of rail and SSS service options, plus the HMT fee forSSS paid by the shipper.** The “Differential” is calculated as the ratio of the shipper costs for trucking service to shipper costs for railand SSS service. In the Atlantic Corridor (South Atlantic to North, SSS economics represent a significantadvantage over truck transportation, and a modest advantage over rail (Table 7.)Table 7 - Cost of Moving a 40-foot Container in the Atlantic Corridor(North Atlantic to South Atlantic)Cost Components Trucking Rail Intermodal SSS (Best-in-Class)Line haul $1,796 $544 $426Drayage (origin) $211 $219Terminal (origin) $52 $65Terminal (destination) $52 $65Drayage (destination) $211 $219Equipment $46 $51Repositioning $85Total cost $1,881 $1,070 $1,045Transit Time 54.4 hours 60.5 hours 70.0 hoursSource: Global Insight, “Four Corridor Case Studies of Short-Sea Shipping Services: Short-SeaShipping Business Case Analysis”, submitted to the U.S. DOT, Office of the Secretary, in associationwith Reeve & Associates, August 15, 2006.ONR SSS Final Report 39