Q2 Z2,(Q2) Z2(Q2) - Institute for Water Resources - U.S. Army

CHAPTER IV
AN ANALYSIS OF DIRECT TOWBOAT AND BARGE COSTS
Inland waterway firms are the operating managers of large, varied,
and costly assortments of floating equipment. This study is an attempt
to determine the influence of the operating environment of inland water-
way barge firms upon the direct Operating costs associated with their
towboat and barge fleets.
A. An Analysis of Direct Towboat Costs
The cost of operating a towboat should be directly related to the
amount of "work" (measured in EBM's or ton-miles) the boat performs.
However, towboats possess a range of capabilities (as measured by their
horsepower and other physical characteristics). In addition, the en-
vironment in which the towboat operates (the waterway) directly affects
the output of the towboat. Thus, one cannot look simply at the average
cost of an EBM. The approach used here is to specify how average cost
varies with output (EBM's) as the characteristics of the equipment and
of the waterway are changed.
The Data
Data on _towboat costs have been gathered from six inland waterqay
operators. The services performed by these six firms are widely dis-
tributed over the entire Mississippi and Gulf River systems. The six
firms are varied as to size and type of traffic carried. Together, the
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