WASTEFUL DUPLICATION

Te Awamutu Courier, Volume 53, Issue 3783, 17 July 1936, Page 11

WASTEFUL DUPLICATION

WHEN IS RAIL OR ROAD CHEAPER? Thus the Hon. R. Semple, Minister of Transport, on the Transport Amendment Bill: "With the idea of eliminating wasteful duplication of road and rail services, it is proposed to provide that no road service shall transport goods over more than a reasonable distance where there is a railway service available.” There at once arises the question: “What is a reasonable distance?” Evidently it is proposed to fix a limit to cover haulage and to deny the issue of licenses to carriers who propose to exceed the limits so defined. Time, then, to seriously consider where economy begins and where it ends. In the answer to this question will be discovered what really is meant by wasteful duplication. In assessing a measure of transport responsibility the railways can well be regarded as the backbone of the land transportation services. No other system could handle the volume of traffic. All that is desirable is an orderly assessment of responsibility to dovetail road and rail so as to secure a balanced relationship in their services to industry. Before searching records to con- . sider ton mile costs, care will have to be taken to make all due allowance for the speed and mobility of motor transport. It is admittedly much more flexible and more readily adaptable to certain needs than the railway, which is definitely tied to , a fixed route. Moreover, the time- • table schedule is much more easily adapted to the motor services because the road vehicle can operate on its own complete loading, whereas an aggregate minimum of tonnage is necessary for a railway service. Obviously, a tonnage which will permit only one train per day into a locality would be sufficient for a timetable with fairly short intervals between the running of road motor vehicles. The mobility and the flexibility of the road motor, its adaptibility to purely localised needs, is a handicap on rail transportation. In the general planning of a transport economy the facilities which respective services offer cannot be ignored. X * * * * Assume, though, that the consideration is now given to a locality where there is a sufficient volume of traffic to enable timetable frequency in the' railway service to fulfil all reasonable needs. Assume, also, that the locality relies entirely on the land services—road or rail—for its transportation and that these land service charges are not influenced by the cheaper rates of sea borne traffic. The assumption must then be that up to a given radius, either road or rail will offer advantage and also beyond that radius wasteful'duplication occurs. In such circumstances the question would resolve itself into the final consideration of cost, because there would be ample service for collection and delivery of the goods, timetable regularity equalling all reasonable needs, and stability and safety I in the service provided. We come to the position in which wc find the local carrier, plus the railways on the one hand, and the long-distance road haulier on the other. • « * « The local carrier is at once handicapped with certain costs of delivery and collection and all of the costs of double handling. At the city terminal, due tq more concentrated traffic, these costs would likely be less than in the provincial town. We do not think it would be wide of the mark to suggest these averages : At the city terminal, 3/6 per ton. At the provincial terminal 4/6 per ton. Say 8/- per ton on every ton handled per rail. These are costs which the longdistance road haulier escapes, but which, in the public estimation of transportation charges, cannot be ignored. • « » » There are so many vagaries in the Railway Rates Tariff, that it is difficult in the extreme to discover a comparative average. According to the ex - Transport Co - ordination Board’s report on competitive transport. #n eight-ton truck fully loaded arwick rates earns: To Whangarei: 1.6 d per ton mile. To Palmerston North 1.55 d per ton mile. The classified rate to Whangarei for general merchandise is 5.55 d per ton mile. • * * * Taking, however, the latest local rates schedule from Auckland to the

King Country as a guide, the general merchandise rate for 100 miles of haulage is 5.4 d per ton mile and for class D goods 4.45 d per ton mile. The nearest indication of railway average rates that we qan find is, however, in the report of the ex-Co-ordination Board (vide page 13), wherein it is stated:

According to the railway representatives, the goods traffic on the railways now returns an average of 2.65 d per ton mile. If that could be increased to 3d per ton mile the railways ‘would have just about paid.’ If, however, the traffic were doubled, the rate which would make them pay might be as low as 2d."

This however, is not a reliable guide. Even the Board qualified its statement with a further observation.

“Even if all the traffic were taken from the roads and shipping, it_ would not double the rail traffic, and it is clear that a figure between the two extremes of 2d and 3d per ton mile is the least at which, goods transport on the rail could be made payable. If large volumes of traffic are taken at lower rates than 2d either through the operation of truck rates or special rates to favoured places, it appears that such traffic must either be carried at uneconomic rates or at the expense of other portions of the community.”

All available evidence points to the conclusion, then, that the latest level of Auckland-King Country rates is a fairly reliable basis of calculation for the charges on general merchandise—the classes of goods most affected by road competition—and we propose to adopt as a basis on 100 miles of haulage a rail rate of 5d per ton mile.

Now to the road operator and his rates. For long-haul transport, there is a general acceptance of 4d per ton mile. We have, however, examined the accounts of several merchants, and, on the basis of 100 . miles of haulage, we find charges varying) from 2.4 d to as high as 5.26 d per ton mile. Even road transport concerns vary the rates according to the competitive influences.

Goods traffic summarised statistics were not available in the Transport Department’s last annual report. From various sources it is generally accepted that 14,000 miles is an average annual truck mileage and, for vehicles with a 6-ton gross register lOd is regarded as the operating cost per vehicle mile. English statistics indicate a 30 per cent, efficiency pay-loading to vehicle capacity and that may be a fair average for New Zealand. This would be the equivalent of a 1.8 ton pay load and, at lOd per vehicle -mile as the operating cost, it would seem to suggest that 6d per ton mile is nearer the mark for road haulage. * » » » . If railway charges were 5d and road transport 6d per ton mile, road costs would be uneconomic for haulage beyond 100 miles as under: Railway (General Merchandise) £ a <1 100 miles at 5d per ton mile 2 18 Terminal transhipment charPer ton £2 9 8 Road Transport £ s . d 100 miles at 6d per ton mile 2 10 0 On the other hand if road transport could prove a case on the basis of the invoices to merchants we have ex-amined—-such accounts ranging from 2.4 d to 5.26 d per ton mile with an average of about 4.5 d per ton mile the comparison would read:Railway (General Merchandise). £ s d 100 miles at 5d per ton mile 2 18 Terminal transhipment charges 8 0 Per ton £2 9 8 Road Transport (General Merchandise). £ s d 100 miles at 4id per ton .mile 1 17 6 And no matter the distance on this basis of calculation the railway would never overtake the economy of road transport. ... * Let it be assumed, however, that A[r Semple aims to secure a levelling of rail tariff rates to a figure (according to the Department’s evidence before the Transport Board) of 3d per ton mile, at which rate, if given the traffic, the railways can be made to pay. We can then discover on 100mile hauls:— Railway. £ s d 100 miles at 3d per ton mile 15 0 Terminal transhipment charges —— 8 0 Per ton- £1 13 0 £ s d Compared with road transport for 100 miles at 4id per ton mile 1 17 6

And so on this basis it would appear that 65 miles is the limit for economic road transport—thus:— Rail. £ s d 65 miles at 3d 16 3 Transhipment charges 8 0 Per ton * £l4 3 Road. 65 miles at 4Jd 14 4 If, on the other hand, road haulage rates to-day were more correctly assessed at 4d per ton mile, the radius for economic road haulage would be considerably affected, and the dividing point would be 100 miles, as under:— Rail. £ s d 100 miles at 3d per ton mile 15 0 Transhipment charges 8 0 Per ton £1 13 0 Road. £ s d 100 miles at 4d per ton mile 1 13 4 ♦ ♦ ♦ » Yet again, if railway tariff is drawn on a rate of 3d per ton mile and road transport is to be assessed at 6d per ton mile, then 35 miles is a maximum for economy in the competitive forms of haulage, thus: Rail. 35 miles at 3d per ton mile 8 9 Terminal Transhipment charPer ton ... 16 9 Road. 35 miles at 6d per ton mile 17 6 Everything will depend on what tariff rate the’ railway adopts as its basis for the tonmile haulage, and also on what the motor transport industry can PROVE is an economic charge for road transportation.