Steamship Line - Definition and Organization

Definition of Steamship Lines

The steamships of the world may be roughly divided into three classes. These are, first, those belonging to mail lines, carrying passengers and mails, and leaving and arriving at certain ports at an advertised time, and with the greatest regularity possible under the circumstances.

The second class consists of steamers not carrying the mails, and sometimes but a few passengers, chiefly devoted to the carrying trade,—cattle, grain, miscellaneous cargoes of ore and general products,—but plying with a certain regularity between stated ports.

The third class comprises all steamers which, having no fixed route, go to any port which offers the best terms for freight, wandering around the globe, and hardly touching at the same place twice. These latter are the'ocean tramp* class of steamships, on which in many cases opprobrium has been unjustly heaped.

Steamship Lines v. Tramp Service

Wherever the volume of the traffic is large enough and the flow of trade or travel sufficiently regular to warrant the establishment of a regular service, the steamship lines have crowded out the tramp service.

They operate over definite routes, adhere to fixed schedules so far as possible, and operate steamers which on the whole are larger and faster and are equipped with more conveniences than those which ply in the tramp service.

Some steamship lines confine themselves to a strictly freight service, but a larger number operate combination steamers which carry both freight and passengers.

Ocean Liner Cargo

The regular cargoes of the great ocean liners consist of passengers, mail, express traffic, and a large variety of high-grade freight. Frequently they also accept partial cargoes of grain and other bulky freight, especially at those great world ports where so many steamship lines operate that the volume of freight, bulky or otherwise, is insufficient to fill the cargo space of all the steamers.

Steamship Line Organization

The organization of the steamship-line service is more complex than that of the tramp service. Steamship lines require an extensive business organization, with executive and corporate, operating, and traffic officials.

They require permanent agents at the ports in which they operate and throughout the interior of the countries which they serve; they conduct advertising campaigns, they operate warehouses, and where public docks are not available they usually own or lease permanent docks.

At some American ports they have entered into agreements with connecting railroad carriers with regard to the use of terminal facilities and the interchange of traffic.[1]

Operating on definite routes, they have also seen fit to enter into contracts with bunker-coal companies, which at contract prices provide them with fuel. Some lines provide themselves with fuel, but most of the hundreds of coaling stations which have gradually been established throughout the world are operated by coaling companies, which sell fuel to steamship lines under contract and to tramps at somewhat higher current prices.[2]

From small packet lines operating between two terminal ports, the line service has developed into huge steamship lines made up of trunk lines and branch lines or feeders.

In many respects they have come to resemble the large railroad systems of the United States, the main trunk lines which connect the great ocean terminals of the world being fed not only by railroads, canals, inland waterways, and smaller independent steamship lines, but also by affiliated and subsidiary branch lines which operate in direct connection with the ocean trunk lines.

The Hamburg-American Packet Company, for example, operates 70 different services, touching at 300 ports of the world. The tonnage of this line, which began with a few sailing-vessels in 1847, grew to more than 200,0c» tons in 1893; 736,000 in 1905, and 1,360,360 in 1913.

The North German Lloyd, which began operation in 1857 with three steamers, had, in 1913, a fleet of over 825,000 tons, and the Royal Mail Steam Packet Company operated fleets totaling 1,380,500 tons.

These enormous fleets, which were brought together by individual navigation companies, partly through the purchase, construction, and chartering of steamers and partly by amalgamation with or by purchasing controlling interests in lines which formerly were independent, disclose but one phase of the organization of the line service.

Another phase of steamship organization is the widespread control, by agreements and conferences, of the competition which originally existed between the various lines. From the standpoint of ease of control, the line service differs essentially from the tramp service.

There are thousands of tramps, which operate independently of each other, with the entire ocean or large parts of it as their highway, but the number of lines is limited and their activities are confined to definite ports and ocean routes.

Though tramp agreements and associations have not been entirely lacking in the foreign trade of the United States, the services and rates of the chartered sailing-vessels and steamers have always been relatively free from restraint and largely subject to competition among the tramp vessels themselves and, for certain kinds of traffic, with the regular navigation lines. In the line service, on the contrary, the number of conferences and agreements has steadily increased.

These agreements vary from oral understandings to written contracts. There are agreements concerning fixed, minimum, and differential rates and fares; the apportionment of traffic by allotting the ports of sailing or by restricting the number of sailings; the limitation of the volume of freight which each line may carry; the pooling of all or a portion of the freight or passenger earnings of the various lines; the depositing of stipulated sums as a guarantee of good faith; and the relations between conferences or between conference and non-conference lines.

There are deferred rebate systems, understandings as to the use of fighting- ships against competing lines, contracts with shippers, and in some cases agreements with American railroads.[3]

In a Government investigation of steamship agreements which was made in 1912 and 1913 it was found that there were 80 steamship agreements and conferences in the foreign trade of the United States, and "that as regards nearly every foreign trade-route practically all the established lines operating to and from American ports work in harmonious cooperation, either through written or oral agreements, conference arrangements, or "gentlemen's understandings."

The few instances where two or more lines serve the same route and have denied the existence of written or oral agreements for the regulation of the trade are exceptions and not the rule."[4]

1 S. S. Huebner, Report on Steamship Agreements and A filiations in the American Foreign and Domestic Trade. (Report of House Committee on the Merchant Marine and Fisheries, 63 Cong., 1914, IV, chap, ix.)

2 Johnson. Panama Canal Traffic and Tolls, chap. x.

3 For detailed statement see S. S. Huebner, Report on Steamship Agreements and A filiations in the American Foreign and Domestic Trade. (Report of House Committee on the Merchant Marine and Fisheries. 63 Cong.. 1914, IV, chap, x.)

4 Ibid.. p. 281.

George Henry Preble, Rear-Adm, USN, History of Steam Navigation, Second Edition, Philadelphia: L. R. Hamersly & Co., 1895, 305-306.

Emory R. Johnson, T. W. Van Metre, G. G. Huebner, and D. S. Hanchett, "Organization of Foreign Trade," in History of Domestic and Foreign Commerce of the United States, Volume II, Washington DC: Carnegie Institution of Washington, 1915, 122-123

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