Mechling States All Modes Necessary For Sound System

The chairman of one of the nation's largest barge companies challenged transportation leaders of all modes to form a "willing partnership with each other, and with government" in order to provide the nation with a transportation system that is efficient, competitive, energy conservative, and that is financially sound.

Speaking at the Transportation Clubs International annual convention in Chicago, 111., Floyd A.

Mechling, chairman of Union Mechling Corporation, stated that the American public requires all modes of transportation in order to receive the best service.

Mr. Mechling said that government "has a chief role in shaping a better transportation network." Citing the example of waterways user charges, however, he criticized government as being too quick to act without performing a thorough analysis of the problems facing transportation.

Improving efficiency by continuing to upgrade the rights-of-way and providing technological improvements is a top priority, he said. He emphasized that Federal funding of river development and the land grants to railroads have been made to benefit regional development, not to benefit the modes.

Currently, however, the attitude of some people is that the barge lines have profited from this Federal support. Mr. Mechling warned that profit margins for barge lines are actually "thin" and that any increased costs from user charges will be passed on to the consumer.

"It is clear that if we are going to develop a sensible approach to the role of government financing for an efficient transportation system, we must begin with a comprehensive review of the nature and extent to which the various forms of transportation already benefit from Federal aides," he said.

Mr. Mechling also stressed the importance of increased intermodal activity. He stated that the inherent advantages of each mode should be maximized and used in combination to provide efficient, low-cost movements.

He said, however, that while increased cooperation benefits the consumer, "we also need to invigorate competition." He pointed out that under the Interstate Commerce Act, there is in reality an incentive for one mode to use price-squeeze tactics to suppress competition because there is no provision for the suppressed party to sue for damages.

Calling it the "most crucial awakening needed today," Mr.

Mechling also stated that there must be a proper understanding that the country faces a longterm shortage of capital. He said the transportation sector is suffering from inadequate revenues and earnings primarily because historic costs, not replacement costs, are used to determine profit needs.

He noted that there are new revenue standards being considered by the ICC, and he urged that they be implemented to provide for "fair, reasonable and economic profit."

Other stories from October 1977 issue


Maritime Reporter

First published in 1881 Maritime Reporter is the world's largest audited circulation publication serving the global maritime industry.