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Analysis of the drop trailer traffic between the B.C. Mainland and Vancouver Island Hinds, Scott Douglas 1977

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ANALYSIS OF THE DROP TRAILER TRAFFIC BETWEEN THE B.C. MAINLAND AND VANCOUVER ISLAND by SCOTT DOUGLAS HINDS B.Comm., U n i v e r s i t y of B r i t i s h Columbia, 1974 A THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF SCIENCE IN BUSINESS ADMINISTRATION / i n the Department of COMMERCE AND BUSINESS ADMINISTRATION We accept t h i s t h e s i s as conforming t o the r e q u i r e d standard THE UNIVERSITY OF BRITISH COLUMBIA A p r i l , 1977 Scott Douglas Hinds In presenting th i s thes is in pa r t i a l fu l f i lment of the requirements for an advanced degree at the Univers i ty of B r i t i s h Columbia, I agree that the L ibrary shal l make it f ree ly ava i lab le for reference and study. I fur ther agree that permission for extensive copying of th is thesis f o r ' s c h o l a r l y purposes may be granted by the Head of my Department or by his representat ives. It is understood that copying or pub l i cat ion of th is thesis for f inanc ia l gain sha l l not be allowed without my written permission. Department of The Univers i ty of B r i t i s h Columbia 2075 W e s b r o o k P l a c e V a n c o u v e r , C a n a d a V 6 T 1W5 Date Z , ABSTRACT T h i s t h e s i s p r o v i d e s an a n a l y s i s of the drop t r a i l e r t r a f f i c moving between the B.C. Mainland and Vancouver I s l a n d . Drop t r a i l e r s are semi t r a i l e r s which are l i t e r a l l y dropped a t the f e r r y t e r m i n a l to be t r a n s p o r t e d across the S t r a i t of Georgia without the accompaniment of the power u n i t and d r i v e r . T h i s s p e c i a l i z e d s e r v i c e i s p r o v i d e d only by the B r i t i s h Columbia Coas-t a l Steamship S e r v i c e , a s u b s i d i a r y of C P . R a i l . One o b j e c t i v e of the t h e s i s i s to analyze the economics of s h i p p i n g v i a drop t r a i l e r as opposed to a l i v e u n i t , or one t h a t i n c l u d e s the d r i v e r and t r a c t o r u n i t such as i s p r o v i d e d by the B.C. F e r r i e s . A second o b j e c t i v e i s to determine the s i z e and importance of the market, and to f o r e c a s t f u t u r e requirements. A t h i r d o b j e c t i v e i s to analyze the p h y s i c a l f a c i l i t i e s a v a i l a b l e to determine t h e i r c a p a c i t y and p o s s i b i l i t i e s f o r expansion. The B.C.C.S.S. f a c i l i t y i n downtown Vancouver i s under p r e s s u r e from v a r i o u s groups to r e l o c a t e to a more s u i t a b l e l o c a t i o n . Thus a f i n a l o b j e c t i v e i s an a n a l y s i s of the b e n e f i t s and c o s t s o f r e -l o c a t i n g the B.C.C.S.S. t e r m i n a l to the n o r t h Richmond area. S i n c e the drop t r a i l e r i n d u s t r y i s very s p e c i a l i z e d , and c a p t i v e to the B.C.C.S.S., very l i t t l e i n f o r m a t i o n i s p u b l i s h e d o r a v a i l a b l e concerning i t . Thus the author has had to r e l y p r i -m a r i l y on d i s c u s s i o n s w i t h a l l the p a r t i e s i n v o l v e d , namely the B.C.C.S.S., C i t y of Vancouver, and numerous c a r r i e r s . One of the by-products of the t h e s i s i s a body o f i n f o r m a t i o n and data p e r t a i n i n g t o the drop t r a i l e r i n d u s t r y , t h a t can be used f o r f u t u r e r e -search i n r e l a t e d t o p i c s . The a n a l y s i s o f the economics of s h i p p i n g v i a drop t r a i l e r shows a s u b s t a n t i a l savings p o t e n t i a l , even though the a c t u a l f e r r y c o s t i s g r e a t e r . The savings are generated by the e l i m i n a t i o n o f i d l e d r i v e r and t r a c t o r time. T h i s s a v i n g was estimated a t $49.20 per one way t r i p . During the p a s t decade the volume o f drop t r a i l e r t r a f f i c has been i n c r e a s i n g s t e a d i l y even though r a i l c a r t r a f f i c has been on the d e c l i n e . T h i s i n c r e a s e i s causing the B.C.C.S.S. to approach the c a p a c i t y of the pr e s e n t system. P o l i t i c a l and p h y s i c a l p r e s s u r e s have r a i s e d the i s s u e o f r e l o c a t i n g the t e r m i n a l A b e n e f i t - c o s t a n a l y s i s of a p a r t i c u l a r a l t e r n a t i v e , a p a r t i a l r e l o c a t i o n to the n o r t h Richmond area shows there can be substan-t i a l b e n e f i t s f o r c a r r i e r as w e l l as the B.C.C.S.S. i v ANALYSIS OF THE DROP TRAILER TRAFFIC BETWEEN THE B.C. MAINLAND AND VANCOUVER ISLAND CONTENTS Page CHAPTER 1 INTRODUCTION: OBJECTIVES AND ORGANIZATION 1.1 O b j e c t i v e s 2 1.2 Area of I n t e r e s t 3 1.3 Importance of T h e s i s 5 1.4 L i m i t a t i o n s 7 1.5 T h e s i s O r g a n i z a t i o n 8 CHAPTER 2 GENERAL FERRY SYSTEM 2.1 Background t o the F r e i g h t Problem 10 2.1.1 Vancouver I s l a n d 10 2.1.2 The Economy 12 2.1.3, T r a n s p o r t a t i o n Network 16 2.2 General Problem of F r e i g h t T r a n s p o r t to and from the I s l a n d 19 2.3 The F e r r y System i n B.C. — A B r i e f H i s t o r y 20 2.3.1 Pre 1958: P r i v a t e E n t e r p r i s e 20 2.3.2 1958 - Government Involvement 22 2.4 F e r r y S e r v i c e s 24 2.4.1 Passenger.and Auto 25 2.4.2 Commercial T r a f f i c 30 2.4.3 Bulk Commodities 35 CHAPTER 3 NATURE- OF DROP TRAILER TRAFFIC 3.1 Operations 37 3.1.1 F a c i l i t i e s 37 3.1.2 S p e c i a l Equipment 4 0 V P a g e 3 . 2 A d v a n t a g e s / D i s a d v a n t a g e s o f D r o p T r a i l e r s 44 3 . 2 . 1 M o t o r C a r r i e r s 4 4 3 . 2 . 2 S h i p p e r s 3 . 2 . 3 F e r r i e s 3 . 3 E c o n o m i c A n a l y s i s o f D r o p T r a i l e r s 47 3 . 3 . 1 E c o n o m i c A d v a n t a g e s 4 7 3 . 3 . 2 T i m e S a v i n g s 4 8 3 . 3 . 3 R a t e S c h e d u l e s 5 1 3 . 3 . 4 T r i p C o s t s 56 A P P E N D I X TO C H A P T E R 3 A n a l y s i s o f V e h i c l e O p e r a t i n g C o s t s 62 I M e t h o d o l o g y 62 I I O p e r a t i n g C o s t s 6 3 A . T r a c t o r s 65 B . T r a i l e r s 65 C H A P T E R 4 T H E N A T U R E O F DROP T R A I L E R T R A F F I C 4 . 1 C h a r a c t e r i s t i c s o f D r o p T r a i l e r T r a f f i c 67 4 . 1 . 1 C o m m o d i t i e s gy 4 . 1 . 2 U s e r s 6 9 4 . 1 . 3 T r a f f i c V o l u m e s 7^ 4 . 1 . 4 T r a f f i c P e a k i n g 7 5 4 . 1 . 5 T r a f f i c P a t t e r n s 7 8 4 . 2 T r a f f i c P r o j e c t i o n s 81 C H A P T E R 5 DROP T R A I L E R F A C I L I T I E S 5 . 1 P r e s e n t F a c i l i t i e s 87 5 . 1 2 1 T e r m i n a l A r e a a n d V e s s e l s 87 5 . 1 . 2 C a p a c i t y o f F a c i l i t i e s 9 1 5 . 2 L o c a t i o n A n a l y s i s 93 5 . 2 . 1 N e c e s s i t y o f P r e s e n t L o c a t i o n 93 5 . 2 . 2 P o l i t i c a l P r e s s u r e 94 5 . 2 . 3 A c c e s s a n d C o n v e n i e n c e 5 . 2 . 4 R e l o c a t i o n Q u e s t i o n 96 5 . 2 . 5 A l t e r n a t i v e s 9 7 v i Page CHAPTER 6 BENEFIT-COST ANALYSIS OF RELOCATION 6.1 B e n e f i t - C o s t A n a l y s i s 101 6.1.1 Us e f u l n e s s o f B e n e f i t - C o s t A n a l y s i s 101 6.1.2 Costs 10 2 6.1.3 B e n e f i t s 104 6.1.4 Discount Rate 116 6.2 Conclus i o n s 118 CHAPTER 7 SUMMARY AND CONCLUSIONS 7.1 Review of T h e s i s 123 7.2 I m p l i c a t i o n s f o r Future Development and Areas f o r Future Research 12 7 v i i LIST OF EXHIBITS NUMBER TITLE PAGE 1.1 P r i n c i p a l F e r r y Routes 4 .2.1 P o p u l a t i o n Centres and T r a n s p o r t a t i o n Network . . . 13 2.2 Economic S e c t o r s - F o r e s t Products 14 2.3 Economic Sec t o r s - O t h e r s ................ 17 3.1 B.C.C.S.S. Schedule .... 4 3 3.2 Commercial F e r r y Rates 54 4.1 B.C.C.S.S. Annual T r a f f i c Volumes ...... 74 4.2 D a i l y Drop T r a i l e r T r a f f i c 77 4.3 B.C.C.S.S. T r a f f i c P r o j e c t i o n s ...... 84 5.1 B.C.C.S.S. F a c i l i t i e s . 89 6.1 Greater Vancouver - L o c a t i o n o f B.C.C.S.S. Users 107 6.2 B e n e f i t s and Costs of the New Drop T r a i l e r F a c i l i t y 117 LIST OF FIGURES A D i v e r t e d T r a f f i c 112 B House P r i c e s vs. Noise ............ 114 v i i i LIST OF TABLES NUMBER TITLE PAGE 2.1 Percent of I s l a n d Labour Force by Ind u s t r y 12 3.1 B.C.C.S.S. V e s s e l S t a t i s t i c s 42 3.2 Comparison of T r i p Times to Vancouver I s l a n d f o r Drop T r a i l e r s vs. L i v e U n i t s . 50 3.3 F e r r y Charges 52 3.4 Truck Costs . 58 4.1 Drop T r a i l e r Volumes by Major User . . . 69 4.2 T r a f f i c Volumes - B.C.C.S.S. . . . . . . . 73 5.1 System C a p a b i l i t i e s 90 6.1 D a i l y D i v e r t e d T r a f f i c Volumes 108 6.2 D i v e r t e d T r a f f i c 109 6.3 Revenue and P r o f i t E stimates 120 A. V e h i c l e Operating Costs 65 i x ACKNOWLEDGEMENT I thank my s u p e r v i s o r , Dr. W.G. Waters I I of the T r a n s p o r t a t i o n Department, Commerce and Business A d m i n i s t r a t i o n and Dr. T. Heaver o f the same department f o r t h e i r p a t i e n c e and advice i n the p r e p a r a t i o n o f t h i s t h e s i s . I thank a l s o R. Zerbst of the Urban Land Economics Department f o r h i s a s s i s t a n c e . F i n a l l y I would a l s o l i k e to thank my w i f e T i n a f o r her kindness and encouragement duri n g the p r e p a r a t i o n o f t h i s t h e s i s . Chapter 1 I n t r o d u c t i o n O b j e c t i v e s and O r g a n i z a t i o n - 2 -1.1 O b j e c t i v e s T h i s t h e s i s examines an i m p o r t a n t component o f t h e B r i t i s h C o l u m b i a M a i n l a n d - V a n c o u v e r I s l a n d t r a n s p o r t a t i o n s y s t e m : t h e d r o p t r a i l e r t r a f f i c . Drop t r a i l e r s , o r s e m i t r a i l e r s t h a t a r e s e n t t o o r f r o m t h e i s l a n d w i t h o u t t h e accompaniment o f power u n i t s , now r e p r e s e n t a l a r g e p o r t i o n o f c o m m e r c i a l t r a f f i c . E q u a l l y as i m p o r t a n t , t h e y r e p r e s e n t t h e o n l y a l t e r n a t i v e t o d r i v e r - a c c o m p a n i e d ( " l i v e " ) t r u c k s , however t h e i r p r e s e n c e i s b a n n e d on t h e government-owned B.C. F e r r i e s . The f i r s t o b j e c t i v e o f t h e t h e s i s i s an a n a l y s i s o f t h e e c o n o m i c s o f s h i p p i n g v i a d r o p t r a i l e r s as o p p o s e d t o l i v e u n i t s . T h i s s h o u l d p r o d u c e a d i f f e r e n c e i n f e r r y i n g c o s t s t h a t c a n be ex-p r e s s e d i n d o l l a r t e r m s . The s e c o n d o b j e c t i v e i s t o a n a l y s e t h e c h a r a c t e r i s t i c s o f d r o p t r a i l e r t r a f f i c . T h i s w i l l i n c l u d e t h e r e c e n t and c u r r e n t t r e n d s i n t h e t r a f f i c i n o r d e r t o d e t e r m i n e t h e s i z e and i m p o r t a n c e o f t h i s m a r k e t . A f o r e c a s t o f f u t u r e t r a f f i c v o l u m e s i s d e v e l o p e d . The t h i r d o b j e c t i v e i s t o a n a l y s e t h e p h y s -i c a l f a c i l i t i e s a v a i l a b l e t o d r o p t r a i l e r s . P a r t i c u l a r a t t e n t i o n i s g i v e n t o p o s s i b l e r e l o c a t i o n and e x p a n s i o n o f f a c i l i t i e s i n l i g h t o f r e c e n t c i v i c d e v e l o p m e n t s . The b e n e f i t s and c o s t s o f s u c h a d e c i s i o n a r e a n a l y s e d . D e s p i t e t h e s i z e and e c o n o m i c i m p o r t a n c e o f V a n c o u v e r I s l a n d , and t h e s i g n i f i c a n t c o n t r i b u t i o n o f d r o p t r a i l e r t r a n s --3-p o r t a t i o n t o i t , p u b l i s h e d i n f o r m a t i o n p e r t a i n i n g t o t h i s segment o f t h e t r a n s p o r t a t i o n i n d u s t r y i s n o n - e x i s t a n t . T h i s t h e s i s p r o -v i d e s an u n d e r s t a n d i n g o f t h e s t r u c t u r e and f u t u r e p r o s p e c t s f o r t h i s t r a f f i c , and p r o v i d e s a d a t a b a s e f r o m w h i c h f u t u r e r e s e a r c h c a n be c o n d u c t e d . 1.2 A r e a o f I n t e r e s t The m a i n a r e a o f i n t e r e s t o f t h i s t h e s i s i s an e x amin-a t i o n o f t h e s e r v i c e s and f a c i l i t i e s p r o v i d e d f o r t h e t r a n s p o r t o f d r o p t r a i l e r t r a f f i c b etween t h e B.C. M a i n l a n d and V a n c o u v e r I s l a n d . S i n c e t h e B r i t i s h C o l u m b i a Government's i n v o l v e m e n t i n f e r r y s e r v i c e s i n 1958, t h e r e have been s e v e r a l i m p o r t a n t c h a n g e s t o t r a f f i c u s i n g t h e f e r r y s y s t e m , e s p e c i a l l y c o m m e r c i a l t r a f f i c . The d r a m a t i c i n c r e a s e i n f e r r y u s e r s p r o m p t e d B.C. P e r r i e s t o change t h e i r p o l i c i e s r e g a r d i n g d r o p t r a i l e r s , and t o t o t a l l y ban them i n 1973. T h i s r e s u l t e d i n a l l d r o p t r a i l e r s b e i n g r o u t e d t h r o u g h C P . R a i l s ' B r i t i s h C o l u m b i a C o a s t a l Steam-s h i p S e r v i c e (B.C.C.S.S.) w h i c h i s l o c a t e d i n V a n c o u v e r . Thus o f p r i m e i n t e r e s t t o t h i s p a p e r i s t h e d r o p t r a i l e r t r a f f i c u s i n g B.C.C.S.S.'s f e r r y f a c i l i t i e s . The B.C.C.S.S. r o u t e s o f i n t e r e s t a r e t h e downtown t o downtown s e r v i c e between V a n c o u v e r and Nanaimo, and V a n c o u v e r t o S w a r t z Bay. T h e s e r o u t e s a r e s h o w n . i n E x h i b i t 1.1 a l o n g w i t h t h e l o c a t i o n o f f e r r y t e r m i n a l s . EXHIBIT 1.1 PRINCIPAL FERRY ROUTES . . . . . . B r i t i s h C o l u m b i a C o a s t a l S t e a m s h i p S e r v i c e — : B.C. F e r r i e s • F e r r y T e r m i n a l - 5 -Although B.C. F e r r i e s main t r a f f i c i s automobile and passenger they do c a r r y commercial v e h i c l e s , but s u b j e c t t o c e r -t a i n r e s t r i c t i o n s . T h i s commercial t r a f f i c i s made up of " l i v e u n i t s " , or u n i t s where the d r i v e r accompanies the u n i t on the f e r r y . S ince l i v e t r u c k s are the most common a l t e r n a t i v e to drop t r a i l e r s , p o l i c i e s a f f e c t i n g B.C. F e r r i e s ' t r a f f i c , and i n p a r t i -c u l a r l i v e t r u c k s , w i l l have an important impact on B.C.C.S.S.'s drop t r a i l e r t r a f f i c . T h e r e f o r e a l l types of commercial motor c a r r i e r t r a f f i c w i l l be o f i n t e r e s t to t h i s t h e s i s . The B.C. F e r r y routes of i n t e r e s t i n t h i s r e g a rd are t h e i r main runs t o and from the i s l a n d , Tsawwassen t o Swartz Bay, and Horseshoe Bay to Departure Bay. These are known as routes 1 and 2 r e s p e c t i v e l y . They are a l s o shown i n E x h i b i t 1.1. Other types of c o a s t a l t r a n s p o r t a t i o n , such as tug and barge t r a f f i c , are of minor importance to drop t r a i l e r s . T h e r e f o r e , t h i s t h e s i s w i l l o n l y g i v e them a c u r s o r y examination. 1.3 Importance o f T h e s i s During the p a s t decade there have been s e v e r a l develop-ments which have changed the s t r u c t u r e of the f e r r y system between the B.C. Mainland and Vancouver I s l a n d . Some of these developments are: (1) S i n c e World War I I o p e r a t i n g costs(economics o f s h i p p i n g has caused the c o n s o l i d a t i o n of the f e r r y l i n e s o p e r a t i n g -6-along the B.C. Coast to a point where there are e f f e c t i v e l y two l i n e s on the B.C. Mainland-Vancouver Island routes. (2) Rapid increases i n passenger and f r e i g h t t r a f f i c has put severe strains on operating equipment. This has caused re-alignment of services to handle the t r a f f i c by the most e f f i -cient methods. (3) The B.C. F e r r i e s ' operations have become oriented to automobile-foot passenger t r a f f i c , and as of 1973, t o t a l l y banned drop t r a i l e r t r a f f i c . As a r e s u l t of these developments, a l l drop t r a i l e r t r a f f i c use the f a c i l i t i e s of B.C.C.S.S., which are located i n down-town Vancouver at the north foot of Burrard Street. Commercial t r a f f i c has experienced rapid increases i n the past few years. This, as well as a general trend away from r a i l c a r to tra c t o r -t r a i l e r units, raises a number of questions such as: (1) What i s the advantage of using drop t r a i l e r s verses l i v e units? (2) Who are the main users of the drop t r a i l e r f a c i l i -t i e s and why? (3) What are the anticipated future volumes of t r a f f i c ? How adequate are the f a c i l i t i e s for handling this t r a f f i c ? (4) What problems are created by the downtown location of B.C.C.S.S.' f a c i l i t i e s ? What are the benefits and costs of moving these f a c i l i t i e s to another location? - 7 -1.4 L i m i t a t i o n s There are s e v e r a l f a c t o r s which l i m i t the scope and accuracy o f t h i s t h e s i s . The most l i m i t i n g f a c t o r i s the s c a r c i t y of good i n f o r m a t i o n . T h i s stems from both a r e l u c t a n c e of the p r i v a t e companies to devulge i n f o r m a t i o n , and from data being non-e x i s t a n t . T r a f f i c data are a v a i l a b l e from both the B.C. F e r r i e s and the B.C.C.S.S. on l y i n aggregate form, which do not l e n d them-s e l v e s to meaningful- comparisons f o r the purposes of t h i s study. Very l i m i t e d f i n a n c i a l data was a v a i l a b l e from each of the two f e r r y l i n e s . A l l p r i v a t e f i r m s i n t e r v i e w e d d e c l i n e d to s p e c i f y o r i g i n s and d e s t i n a t i o n s of commodities moving by drop t r a i l e r s . The competitiveness of the i n d u s t r y was the main reason f o r t h e i r r e l u c t a n c e . The q u e s t i o n of a r e l o c a t i o n has important p o l i t i c a l and economic r a m i f i c a t i o n s f o r s e v e r a l p a r t i e s a nd,therefore d i f f i c u l t y was encountered i n o b t a i n i n g s p e c i f i c i n f o r m a t i o n about i t , although a number of persons d i s c u s s e d i t i n very g e n e r a l terms. These f a c t o r s , as w e l l as the f i n i t e time a v a i l a b l e served to l i m i t some p o r t i o n s of t h i s t h e s i s . - 8 -1. 5 T h e s i s O r g a n i z a t i o n The d e v e l o p m e n t and i m p o r t a n c e o f t h e B.C. M a i n l a n d -V a n c o u v e r I s l a n d f e r r y s e r v i c e i s t h e g e n e r a l theme o f C h a p t e r 2. T h i s i n c l u d e s a d i s c u s s i o n o f t h e g e n e r a l p r o b l e m o f f r e i g h t t r a n s p o r t a t i o n t o and f r o m t h e I s l a n d , as w e l l as an i n v e n t o r y o f t h e s e r v i c e s w h i c h a r e a v a i l a b l e . C h a p t e r 3 i s an i n - d e p t h a n a l y s i s o f t h e d r o p t r a i l e r t r a f f i c . T h i s e x a m i n e s t h e o p e r a t i o n s , a d v a n t a g e s and d i s a d v a n -t a g e s , and t h e e c o n o m i c s o f d r o p t r a i l e r s compared t o l i v e t r u c k s . C h a p t e r 4 examines t h e o v e r a l l c h a r a c t e r i s t i c s o f d r o p t r a i l e r t r a f f i c . T h i s i n c l u d e s i d e n t i f y i n g t h e m a j o r c o m m o d i t i e s , u s e r s , v olumes a n d t r a f f i c p a t t e r n s . A f o r e c a s t o f f u t u r e volumes i s d e v e l o p e d i n t h i s c h a p t e r w h i c h c o v e r s t h e n e x t t e n y e a r s . C h a p t e r 5 a n a l y z e s t h e p r e s e n t f a c i l i t i e s w i t h r e s p e c t t o f u t u r e c a p a c i t y r e q u i r e m e n t s and c o n s t r a i n t s o f t h e t e r m i n a l a r e a and v e s s e l s . : A l o c a t i o n a l a n a l y s i s d e a l s w i t h t h e p r o b l e m s and p a r t i e s i n t e r e s t e d i n t h e c u r r e n t l o c a t i o n . C h a p t e r 6 p r e -s e n t s a b e n e f i t - c o s t a n a l y s i s o f a p a r t i a l r e l o c a t i o n o f t e r m i n a l f a c i l i t i e s . C h a p t e r 7 c o n c l u d e s t h e t h e s i s and o f f e r s recommenda-t i o n s f o r a r e a s o f f u t u r e r e s e a r c h . - 9 -C h a p t e r 2 G e n e r a l F e r r y S y s t e m 2.1 Background to: the: F r e i g h t Problem In order to a p p r e c i a t e the problems i n v o l v e d w i t h the pr e s e n t system of f r e i g h t t r a n s p o r t a t i o n to and from the I s l a n d , an understanding of the p h y s i c a l and economic c h a r a c t e r i s t i c s of the I s l a n d i s necessary. People, the economy and the p r e s e n t t r a n s p o r t a t i o n network on the i s l a n d have pl a y e d a c r u c i a l r o l e i n the "shaping of the c u r r e n t f e r r y system, and w i l l continue to e x e r t such i n f l u e n c e i n the f u t u r e . T h e r e f o r e t h i s s e c t i o n of the t h e s i s reviews the r e l e v e n t c h a r a c t e r i s t i c s of Vancouver I s l a n d . 2.1.1 Vancouver I s l a n d Vancouver I s l a n d l i e s o f f the southern coast of the B r i t i s h Columbia mainland. I t extends 2 80 m i l e s i n a north-west-southeast d i r e c t i o n , and has an average width of 50 m i l e s , and a maximum of j u s t over 80 m i l e s . With a t o t a l area of j u s t over 12,800 square m i l e s , Vancouver I s l a n d i s the l a r g e s t i s l a n d l y i n g o f f the west co a s t of North or South America"'". The i s l a n d has two d i s t i n c t p a r t s , — a long narrow e a s t e r n c o a s t a l p l a i n and a rugged mountain backbone along the ^ " B r i t i s h Columbia, Regional Index: Q.f: B r i t i s h ' Columbia, January, 1966 update 1972. -11-western coast. The western and n o r t h e r n p o r t i o n s of the i s l a n d f e a t u r e dense f o r e s t s and s e v e r a l deep f i o r d s . The ruggedness of t h i s area makes t r a v e l d i f f i c u l t , which accounts f o r i t s sparce p o p u l a t i o n . On the o t h e r hand, the lowlands, which extend from V i c t o r i a t o Campbell R i v e r on the e a s t e r n c o a s t are very much l i k e the F r a s e r V a l l e y on the mainland; — f e r t i l e , , a c c e s s a b l e and p r o v i d e e x c e l l e n t l i v i n g c o n d i t i o n s . T h i s p a r t of the i s l a n d enjoys one of the most f a v o r a b l e c l i m a t e s i n Canada. As a r e s u l t , t h i s area and V i c t o r i a i n p a r t i c u l a r are extremely a t -t r a c t i v e as an area f o r r e t i r e m e n t . P o p u l a t i o n The t o t a l area of Vancouver I s l a n d makes up something l e s s than 3.7% o f the t o t a l area of the p r o v i n c e of B.C. However, the p o p u l a t i o n , a c c o r d i n g to the 1971 census accounts f o r about 2 16% of the p r o v i n c i a l t o t a l or approximately 375,000 persons . By f a r , the g r e a t e s t c o n c e n t r a t i o n of people l i v e i n or around the c a p i t a l , V i c t o r i a . Up u n t i l 1966 the V i c t o r i a area accounted f o r about one-half the i s l a n d p o p u l a t i o n . However i n r e c e n t years t h i s percentage has dropped somewhat as the c e n t r a l area of the i s l a n d has experienced a r a p i d increase;.inypppulatioriv The Nanaimo area, o f t e n r e f e r r e d to as " l i t t l e V i c t o r i a " , i s the second l a r g e s t 'population area on the i s l a n d and has become the d i s t r i b u t i o n c e n t e r f o r the c e n t r a l i s l a n d r e g i o n s . T h i s i n c l u d e s the c i t i e s of S t a t i s t i c s Canada, 19 71 Census of Canada: P o p u l a t i o n - Age Groups, Catalogue 92-715 A p r i l 1973. -12-Courtney, P o r t A l b e r n i , Duncan and Campbell R i v e r . E x h i b i t 2.1 shows the c o n c e n t r a t i o n of development along the e a s t e r n seaboard. Of the 10 census d i v i s i o n s i n the 19 71 census, the Vancouver I s l a n d d i v i s i o n had the l a r g e s t p r o p o r t i o n o f people over 65 years of age. T h i s amounted to 12.4% o f the p o p u l a t i o n . V i c t o r i a and Oak Bay each had over 20% of t h e i r p o p u l a t i o n i n t h i s age b r a c k e t , c o n f i r m i n g the area as a prime spot f o r r e t i r e m e n t . 2.1.2 The Economy The c h i e f primary i n d u s t r i e s on the i s l a n d are f o r e s t r y , a g r i c u l t u r e , f i s h i n g and mining. In 1961 the labour f o r c e o f Vancouver I s l a n d c o n t a i n e d approximately 17% of the p r o v i n c i a l t o t a l . The composition of t h i s t o t a l was: Table 2.1 Percent of I s l a n d Labour Force by Indu s t r y A g r i c u l t u r e 2. 3% F o r e s t r y 7. 4% F i s h i n g 1. 3% Mining 1. 0% Manufacturing 16. 2% C o n s t r u c t i o n 4. 9% Wholesale trade 2. 9% R e t a i l Trade 11. 7% S e r v i c e I n d u s t r i e s 49. 4% Source: Regio n a l Index of B r i t i s h Columbia. EXHIBIT 2.1 •13-POPULATION CENTRES AND TRANSPORTATION NETWORK B.C. MAINLAN£ 14 15. 16. 17. 18* POPULATION CENTRES 1. G r e a t e r V i c t o r i a 2. Duncan 3. Lake Cowichan 4. Lady Smith 5. Nanaimo 6. P a r k s v i l i e 7. Qualicum 8. P o r t A l b e r n i 9. U c l u e l e t 10. T o f i n o 11. Comox 12. Courtney 13. Campbell R i v e r Kelsey Bay Beaver Cove P o r t A l i c e P o r t Hardy P o r t M c N e i l l TRANSPORTATION NETWORK A i r p o r t s I s l a n d Highway B. C. F e r r i e s C. N. R a i l C P . R a i l —-R e s t r i c t e d Use Roads • EXHIBIT 2.2 -15-F o r e s t r y i s by f a r the most important of these a c t i v i t i e s . More than 1/3 of the p r o v i n c i a l labour f o r c e engaged i n l o g g i n g i s 3 l o c a t e d on Vancouver I s l a n d . The main f o r e s t r y areas are l o c a t e d near A l b e r n i , A l e r t Bay, Campbell R i v e r , Ladysmithr-Chenainus, Lake Cowichen, P o r t A l i c e , Nanaimo, Duncan, and the Z e b a l l o s - T h a s i s area. Manufacturing i s a l s o very important to the i s l a n d economy, and about two-thirds of i t i s r e l a t e d to the f o r e s t r y i n d u s t r y i n the p r o d u c t i o n of pulp and paper, lumber, plywood and chipboard. Pulp and paper p r o d u c t i o n on the i s l a n d accounts f o r over 1/2 the p r o v i n c i a l p r o d u c t i o n , and i s one of the i s l a n d s ' g r e a t e s t sources of money income. E x h i b i t 2.2 shows the l o c a t i o n of these i n d u s t r i e s . T able 2.1 shows t h a t by f a r the l a r g e s t percentage of persons i n any one i n d u s t r y work i n the s e r v i c e i n d u s t r y . A very l a r g e p o r t i o n of t h i s f i g u r e i s made up of c i v i l s e r v a n t s , — a r e s u l t of V i c t o r i a b e i n g the p r o v i n c i a l c a p i t a l and the home of the l e g i s l a t u r e . In terms of numbers, the c i v i l s e r v i c e approx-i m a t e l y equals the manpower of the f o r e s t i n d u s t r y . Only a very s m a l l p r o p o r t i o n of the i s l a n d i s d i r e c t l y concerned w i t h a g r i c u l t u r e . I t i s by no means s e l f s u f f i c i e n t , 'Verner, C., D i r e c t o r Report #15 ARDA -- A Socio-Economic Survey of the Vancouver I s l a n d Area, U.B.C., Vancouver, B.C., 1970. -16-nor i s i t expected to become so, w i t h l i t t l e expansion due to l i m i t e d f i r s t c l a s s s o i l and h i g h l a n d p r i c e s . Beef c a t t l e i s the most prominant primary product f o l l o w e d by d a i r y products. Over 80% of the acres under crop are f o r the p r o d u c t i o n o f hay and o t h e r fodder crops. Even so, feed must o f t e n be t r a n s p o r t e d i n from the mainland. Although the b a s i c component of the Nanaimo and Duncan economies i s f o r e s t r y , the bulk of the employment i s p r o v i d e d by s e r v i c e i n d u s t r i e s . S e r v i c e s i n d u s t r i e s a l s o rank f i r s t i n the economies of Greater V i c t o r i a , Courtney-Comox, P a r k s v i l l e - Q u a l i c u m Beach, and Sooke-Jordon R i v e r . Much of t h i s employment i s d i r e c t e d at the e v e r - i n c r e a s i n g t o u r i s t i n d u s t r y . The economies of U c l u e l e t and T.ofino are based p r i m a r i l y on commercial f i s h i n g w i t h some l o g g i n g and mining. The west c o a s t , w i t h the completion of the c o n s t r u c t i o n and paving of highway #4, i s r a p i d l y i n c r e a s i n g t h e i r t o u r i s t i n d u s t r y i n the area shown i n E x h i b i t 2.3. 2.1.3 T r a n s p o r t a t i o n Network At p r e s e n t i t i s i m p o s s i b l e to d r i v e the e n t i r e l e n g t h o f the i s l a n d on p u b l i c roads. On the e a s t c o a s t , a paved highway runs from V i c t o r i a to Kelsey Bay, a d i s t a n c e of 250 m i l e s . The n o r t h e r n communities of P o r t A l i c e , P o r t Hardy and Beaver Cove are c u t - o f f from the highway and the south. As a r e s u l t s h i p p i n g i s -17-EXHI8IT 2.3 -18-o r i e n t e d from Vancouver rather, than V i c t o r i a . T h i s p a t t e r n w i l l change when roads are b u i l t , but a t p r e s e n t the n o r t h e r n popula-t i o n does not warrant the very h i g h c o s t of c o n s t r u c t i o n of such roads. Highway access to the west co a s t i s l i m i t e d t o highway #4 to T o f i n o and U c l u e l e t . Use of p r i v a t e l o g g i n g roads i s p e r m i t t e d i n some cases, but only on a r e s t r i c t e d b a s i s . The highway net-work i s shown on E x h i b i t 2.1. Although the f i r s t scheduled f l i g h t s s t a r t e d between V i c t o r i a and Vancouver i n 1933, the p o p u l a r i t y of a i r t r a v e l was a post war phenomenon. " U n t i l the appearance o f an e x t e n s i v e a i r s e r v i c e a f t e r W.W. I I as many as one hundred c o a s t a l commun-i t i e s had no t r a n s p o r t f a c i l i t i e s a v a i l a b l e to ^ them except those s u p p l i e d by the c o a s t a l c a r r i e r s . " Today the a i r system i s made up of three r e g u l a r l y scheduled c a r r i e r s , and a number of s m a l l e r c h a r t e r c a r r i e r s . The bulk of the t r a f f i c u s i ng the system flow between Vancouver and s e v e r a l i s l a n d p o i n t s . P a c i f i c Western A i r l i n e s , the dominant i s l a n d c a r r i e r estimates t h a t only 5% of gross revenues r e s u l t s from the c a r r i a g e of a i r cargo. Of the a i r cargo c a r r i e d , about 65% i s d e s t i n e d t o P o r t Hardy. The reason f o r t h i s i s the absence of a highway network to the n o r t h e r n communities. T o u r i s t passengers are very important to the l a r g e r c a r r i e r s , P.W.A. and A i r Canada, e s p e c i a l l y d u r i n g the summer months. As t h e r e i s no s e r v i c e from Purdy, H.L., T r a n s p o r t Competition and P u b l i c P o l i c y i n Canada, U n i v e r s i t y of B r i t i s h Columbia P r e s s , V a n c o u v e r , 1972. - 1 9 -V i c t o r i a n o r t h , a l l t r a f f i c must be r o u t e d t h r o u g h V a n c o u v e r . 2.2 G e n e r a l P r o b l e m o f F r e i g h t T r a n s p o r t t o and From t h e I s l a n d The d e v e l o p m e n t o f V a n c o u v e r I s l a n d w i t h r e s p e c t t o i t s p o p u l a t i o n , economy, t r a n s p o r t a t i o n n e t w o r k and r e l a t i o n s h i p t o t h e r e s t o f B r i t i s h C o l u m b i a , have had v e r y i m p o r t a n t c o n s e q u e n c e s on t h e t r a n s p o r t a t i o n o f f r e i g h t t o and f r o m t h e i s l a n d . I n g e n e r a l t e r m s , t h o s e f a c t o r s w h i c h have b e e n most i m p o r t a n t i n d e v e l o p m e n t o f t h e p r e s e n t s y s t e m a r e : (1) The l a r g e p o p u l a t i o n o f V a n c o u v e r I s l a n d , as w e l l as i t s e c o n o m i c r e l a t i o n s w i t h t h e r e s t o f B r i t i s h C o l u m b i a n e c e s s i t a t e s a h i g h d e g r e e o f c o m m u n i c a t i o n between t h e two. Thus t h e f e r r y s y s t e m has a l w a y s b e e n a p o l i t i c a l l y s e n s i t i v e i s s u e , e s p e c i a l l y s i n c e t h e p r o v i n c i a l l e g i s l a t u r e i s l o c a t e d i n V i c t o r i a . C o n s e q u e n t l y t h e f e r r y s y s t e m has b e e n more o r i e n t e d t o a r a p i d t h r o u g h p u t o f p a s s e n g e r s and a u t o s t h a n f o r t h e p r o v i s i o n o f f r e i g h t s e r v i c e s . (2) The i m p o r t a n c e o f t h e t o u r i s t i n d u s t r y t o t h e I s l a n d economy, as w e l l as t h e g o v e r n m e n t ' s e f f o r t s t o p r omote i t i n t e n s i f i e s t h e o r i e n t a t i o n o f t h e f e r r y s y s t e m t o p a s s e n g e r s o f a u t o s . F u r t h e r m o r e , t h e d i f f e r e n t o p e r a t i n g and h a n d l i n g c h a r a c -t e r i s t i c s o f t r a c t o r - t r a i l e r s and a u t o s t e n d s t o a c c e n t u a t e t h e n e e d t o s e p a r a t e them. T h i s i s p a r t i c u l a r l y t r u e d u r i n g t h e summer months when s e v e r e p e a k i n g o f demand o c c u r s . T h i s p r o b l e m h a s l e d t o v a r i o u s r e s t r i c t i o n s b e i n g p l a c e d on c e r t a i n c o m m e r c i a l t r u c k - 2 0 -t r a f f i c by B.C. F e r r i e s . ( 3 ) The primary, i n d u s t r i e s of the I s l a n d are e x t r a c -t i v e i n nature and t r a n s p o r t a t i o n of t h e i r products r e q u i r e bulk movements by e i t h e r barge or r a i l r o a d . On the other hand, t r a f f i c moving t o the i s l a n d i s p r i m a r i l y g e n e r a l merchandise and f o o d s t u f f s , and t h e r e f o r e o r i e n t e d to motor c a r r i e r t r a n s p o r t . A c c o r d i n g l y there i s an imbalance i n eastwest movements by each mode, which has been estimated f o r r a i l c a r as 6 to 1 i n favour of eastbound movements, and 4 to 1 f o r t r u c k t r a f f i c , f a v o u r i n g 5 westbound movements. ( 4 ) The d i s t a n c e to the i s l a n d from Vancouver i s not g r e a t — i n the neighbourhood of 2 5 m i l e s . However to move goods to a p o i n t on the i s l a n d i n v o l v e s r o u t i n g i t through one of the g r e a t e r Vancouver t e r m i n a l s to one of two t e r m i n a l s on the i s l a n d . T h e r e f o r e , even though the d i s t a n c e i s not g r e a t , the c o s t i s s u b s t a n t i a l due to f e r r y c o s t s , i d l e time, w a i t i n g time, access time, f e r r y schedules,.and unavoidable congestion i n Vancouver. 2 . 3 The F e r r y System i n B r i t i s h Columbia — A B r i e f H i s t o r y 2 . 3 . 1 Pre 1 9 5 8 Up u n t i l 1 9 5 8 f e r r y s e r v i c e was p r o v i d e d e n t i r e l y by p r i v a t e e n t e r p r i s e . The Union Steamship Company of B r i t i s h 5 - . . P e r s o n a l i n t e r v i e w w i t h Mr. Jim Yates, Manager, B r i t i s h Columbia C o a s t a l Steamships, Vancouver. -21-Columbia was the major c a r r i e r , and a t the h e i g h t of i t s e x i s t a n c e , served the B.C. c o a s t e x t e n s i v e l y . Canadian P a c i f i c N a v i g a t i o n Company began s e r v i c e between west c o a s t p o r t s and between Vancouver 7 and V i c t o r i a i n the l a t e 1880's. In 1901 Canadian P a c i f i c R a i l -way purchased t h i s company and began the " t r i a n g l e run" — V i c t o r i a - V a n c o u v e r - S e a t t l e . The Black B a l l F e r r y L i n e was the t h i r d l a r g e s t l i n e , connecting Departure Bay i n Nanaimo and Horse-shoe Bay on the mainland. During World War I I , s e v e r a l f e r r i e s i n v o l v e d i n B.C. c o a s t a l s e r v i c e were commissioned f o r war uses such as h o s p i t a l s h i p s and t r a n s p o r t e r s . The reduced number of f e r r i e s i n the post war p e r i o d were faced w i t h a r a p i d l y i n c r e a s i n g demand f o r the t r a n s p o r t of highway v e h i c l e s , i n c l u d i n g both t r u c k s and passenger v e h i c l e s . T h i s p r e s e n t e d severe c a p a c i t y problems as the f e r r y f l e e t was, f o r the most p a r t , made up of s m a l l ocean l i n e r s , q u i t e inadequate f o r the t r a n s p o r t of v e h i c l e s . With the new demands bei n g p l a c e d on i t the f l e e t had become o b s o l e t e . The p o s t war p e r i o d was a l s o c h a r a c t e r i z e d by r a p i d l y i n c r e a s i n g o p e r a t i n g c o s t s as w e l l as replacement c o s t s . S t i f f c o m p e t i t i o n was experienced on the main cargo routes w h i l e 7 Revised S t a t u t e s of Canada, .1970 Appendix p. 279. Order of Her Majesty i n C o u n c i l Admitting B r i t i s h Columbia i n t o the Union, May 16, 1971. -22-t r a f f i c was b e i n g l o s t t o the a i r l i n e s on the l o n g e r runs. These f a c t o r s a l l c o n t r i b u t e d to the d o w n f a l l of the Union Steamship S e r v i c e s . In 1956 Black B a l l r e p l a c e d i t on the Bowen I s l a n d run. In January, 1959 the Union Company f i n a l l y s o l d i t s a s s e t s to i t s competitor, N o r t h l a n d N a v i g a t i o n . 2.3.2 195 8 Government Involvement The o p e r a t i n g d i f f i c u l t i e s of Union were a l s o f e l t by the Black B a l l L i n e and Canadian P a c i f i c Railway's B r i t i s h Columbia C o a s t a l Steamship S e r v i c e , (B.C.C.S.S.). In 1958 the employees of B.C.C.S.S. s t r u c k f o r h i g h e r wages. They were sup-p o r t e d by the employees of Black B a l l . The B.C. Cabinet under W.A.C. Bennett evoked the C i v i l Defense A c t which allowed the government to take p o c e s s i o n of and use the p r o p e r t y of the Black B a l l L i n e . The employees of the company s t r u c k again i n d e f i a n c e of the order and i g n o r e d an i n j u n c t i o n to r e t u r n to work. As a r e s u l t , the Premier announced t h a t the government would e s t a b l i s h i t s own f e r r y system to the i s l a n d so t h a t f e r r y connections be-tween the i s l a n d and mainland would"not be s u b j e c t t o e i t h e r the whim of union p o l i c y nor to the i n d i f f e r e n c e of f e d e r a l agencies." The government s t a r t e d by l e t t i n g two tenders f o r one f e r r y each to two B.C. s h i p b u i l d i n g companies, the V i c t o r i a Cadieux, H. and G r i f f i t h s , G., p. 10, Dogwood F l e e t ; the S t o r y of the B r i t i s h Columbia Ferry: A u t h o r i t y from 1958. Nanaimo, Cadieux and G r i f f i t h s L t d . , 1967. -23-Machinery Depot and B u r r a r d Dry Dock. The MV Sidney ( l a t e r renamed Queen of Sidney) was completed on October 6, 1959 and the MV Tsawwassen ( l a t e r renamed Queen of Tsawwassen) was completed on November 28/1959. In 1959 Swartz Bay was named as the Vancouver I s l a n d t e r m i n a l and Tsawwassen f o r the south Vancouver t e r m i n a l . These two p o i n t s were chosen f o r the s h o r t route c r o s s i n g and the f a s t turnaround. C o n s t r u c t i o n was s t a r t e d immediately. The new system o f f e r e d a two hour s e r v i c e . The r a t i o n a l e f o r the government's d e c i s i o n on the l o c a t i o n o f the t e r m i n a l s a t Tsawwassen and Swartz Bay i s based on C.P.R.'s o p e r a t i o n s . In 1959 the C.P.R. had withdrawn i t s n i g h t steamers from the V i c t o r i a - V a n c o u v e r run and reduced i t s w i n t e r s e r v i c e . A f t e r commencement of the Government S e r v i c e , C.P.R. abandoned t h i s run a l t o g e t h e r . In 1962 C.P.R. f u r t h e r reduced i t s s e r v i c e by withdrawing two of i t s t h r e e s h i p s from the Vancouver-Nanaimo run. S i n c e the i n a u g u r a t i o n of the Government F e r r i e s on June 15, 1960, the system has experienced a tremendous i n c r e a s e i n t r a v e l l e r s . To meet the demand, B.C. F e r r i e s c a r r i e d out an ambi-t i o u s expansion programme of purchasing and b u i l d i n g f e r r i e s . In September,19 61, the G u l f I s l a n d S e r v i c e was purchased by the B.C. F e r r y A u t h o r i t y . In October,. 1961, the Black B a l l F e r r i e s L t d . , which operated f e r r i e s from Horseshoe Bay to Nanaimo as w e l l as -24-t h e S u n s h i n e C o a s t was p u r c h a s e d . From 1962-1965 t h e B.C. F e r r y A u t h o r i t y h a d a n o t h e r t e n s h i p s b u i l t f o r them. I n 196 6 t h e F e d e r a l G o v e r n m e n t s h i p b u i l d i n g s u b s i d y was c u t f r o m 40% t o 25% and e v e n t u a l l y t o 17%. T h i s , c o m b i n e d w i t h t h e r a p i d l y i n c r e a s i n g c o s t s o f c o n s t r u c t i o n , made t h e p u r c h a s e o f new s h i p s p r o h i b i t i v e . F r om 196 6 t o 19 74 no new f e r r i e s h a v e b e e n b u i l t f o r t h e f l e e t . A s a r e s u l t , t h e A u t h o r i t y t u r n e d t o p u r c h a s i n g f e r r i e s f r o m o t h e r s o u r c e s . F rom 1966 t o 1974 s i x o f t h e s e f e r r i e s w e r e a c q u i r e d and p u t t o d u t y on t h e B.C. c o a s t a s p a r t o f t h e "Dogwood F l e e t " . I n 19 74 t h e g o v e r n m e n t a n n o u n c e d t h a t t e n d e r s w e r e l e t f o r t h e c o n s t r u c t i o n o f t h r e e new f e r r i e s . A l t h o u g h t h e h u l l s a r e a l l t h e same, one f e r r y ' s s u p e r s t r u c t u r e i s d e s i g n e d as a t r a i l e r f e r r y . The t o t a l p r o g r a m w i l l c o s t i n t h e n e i g h b o u r h o o d o f 50 M. and t h e s c h e d u l e d d e l i v e r y d a t e i s m i d 1976. 2.4 F e r r y S e r v i c e s A w i d e r a n g e o f s e r v i c e s a r e p r o v i d e d b y t h e f e r r i e s o p e r a t i n g b e t w e e n t h e B.C. M a i n l a n d and V a n c o u v e r I s l a n d . T h e s e s e r v i c e s i n c l u d e p a s s e n g e r , a u t o m o b i l e and c o m m e r c i a l v e h i c u l a r t r a f f i c . The p u r p o s e o f s t u d y i n g t h e s e s e r v i c e s i s t o i d e n t i f y t h e i n t e r r e l a t i o n s h i p s o f e a c h , and t h e m a r k e t s e g m e n t a -t i o n by t h e c a r r i e r s . The p o l i c i e s f o l l o w e d by one c a r r i e r may h a v e s e r i o u s i m p l i c a t i o n s f o r t h e o t h e r c a r r i e r . T h u s , t o u n d e r --25-stand the drop t r a i l e r t r a f f i c i n p a r t i c u l a r , a g e n e r a l background knowledge o f the whole f e r r y system i s necessary. 2.4.1 Passenger and Auto In t o t a l , f i v e c a r r i e r s supply d i r e c t s e r v i c e to the I s l a n d : B.C. F e r r i e s ; B.C.C.S.S.; Washington S t a t e F e r r i e s ; B l a c k B a l l T r a n s p o r t ; and the B.C. Department of Highways. Washington S t a t e F e r r i e s and Black B a l l F e r r i e s serve V i c t o r i a and Swartz Bay from the S t a t e of Washington p o i n t s of P o r t Angeles, and Anacortes. The B.C. Department of Highways makes one run be-tween Powell R i v e r and Comox. However on the routes of i n t e r e s t to t h i s t h e s i s , the lower B.C. mainland to Vancouver I s l a n d , the only two c a r r i e r s are B.C. F e r r i e s and C.P.'s B r i t i s h Columbia C o a s t a l Steamship S e r v i c e . S i n c e passengers and automobile t r a f f i c cannot be separated as they r e q u i r e a j o i n t s e r v i c e , they w i l l be d i s c u s s e d together i n t h i s s e c t i o n . B.C. - F e r r i e s Although both B.C.C.S.S. and B.C. F e r r i e s c a r r y passengers and autos, B.C. F e r r i e s i s by f a r the l a r g e r . B.C. F e r r i e s operates f o u r f e r r i e s on each of i t s two major r o u t e s , 9 Tsawwassen to Swartz Bay, and Horseshoe Bay to Departure Bay. During the summer months t h i s i s i n c r e a s e d to f i v e on each r o u t e . -26-T h e s e two r o u t e s ( o u t o f 12) a c c o u n t f o r o v e r 2/3 o f a l l Government c a r r i e d t r a f f i c t o t h e i s l a n d . B.C. F e r r i e s s y s t e m f e a t u r e s a modern f l e e t , p a s s e n g e r c o n v e n i e n c e s , and a s a i l i n g t i m e o f l e s s t h a n two h o u r s . T h e i r s y s t e m o f l o a d i n g , u n l o a d i n g , and t e r m i n a l l o c a t i o n a r e a l l d e s i g n e d f o r r a p i d t u r n a r o u n d . The f e r r i e s on t h i s r o u t e have a c a r c a p a c i t y o f 192 and a p a s s e n g e r c a p a c i t y o f 1200. The f e r r i e s u s u a l l y s a i l w i t h e x c e s s p a s s e n g e r c a p a c i t y as v e h i c l e c a p a c i t y i s r e a c h e d much s o o n e r . "^ One r e a s o n f o r t h i s i s t h a t o v e r 50% o f a l l v e h i c l e s have two o r l e s s passengers."''''' The a v e r -age number o f p a s s e n g e r s p e r c a r i s 2.3. T h e r e a r e s i x t e e n s a i l i n g s p e r day o f f e r e d a t e a c h t e r m i n a l . The s c h e d u l e d i f f e r s s l i g h t l y d u r i n g t h e w i n t e r months. The B.C. F e r r i e s e x p e r i e n c e s e v e r e p e a k i n g d u r i n g t h e summer months w h i c h o f t e n c a u s e s l o n g d e l a y s f o r t h e u s e r s . The B r i t i s h C o l u m b i a F e r r y S t u d y f o u n d d u r i n g t h e summer months t h a t r o u t e s one and two have an a v e r a g e u t i l i z a t i o n - i n t h e . ,-. 12 n e i g h b o u r h o o d o f 85%. D u r i n g t h e p o p u l a r d a y t i m e h o u r s , t h e Mr. B. B o u c h a r d , A s s i s t a n t T r a f f i c Manager, B.C. F e r r i e s . T h i s s i t u a t i o n c o u l d change i f an a b n o r m a l number o f b u s e s a r r i v e d f o r o n e s a i l i n g . As a r e s u l t , b u s e s a r e l i m i t e d t o 9 p e r s a i l i n g . 1 1 S . P . E . C . and U.B.C. T r a n s p o r t a t i o n C e n t r e , B r i t i s h C o l u m b i a  F e r r y S t u d y , 1973. 12 S.P.E.C. and U.B.C. T r a n s p o r t a t i o n C e n t r e , B r i t i s h C o l u m b i a F e r r y S t u d y , 1973. -27-e f f e c t i v e u t i l i z a t i o n i s 100%. The study f u r t h e r found t h a t the main cause of peaking are t o u r i s t s , which account f o r 75% o f the t r i p s . 36.6% of the users d u r i n g the summer months are from o u t s i d e B.C. T h i s g i v e s an i n d i c a t i o n of the importance of the 13 t o u r i s t i n d u s t r y to Vancouver I s l a n d . The s h i p s b u i l t d u r i n g the 1960's f o r B.C. F e r r i e s o r i g i n a l l y had a c a p a c i t y of 100 c a r s . T h i s c a p a c i t y was i n c r e a s e d to 144 cars i n 1967-1969 by the a d d i t i o n o f p l a t f o r m decks. These decks f o l d down over the r e g u l a r lanes of v e h i c l e s . There i s a problem however, i n t h a t the deck or f l a p s cannot be lowered i f t h e r e are any v e h i c l e s i n excess of s i x f e e t s i x inches i n h e i g h t 14 i n the f i r s t two l a n e s . T h i s means t h a t most commercial t r u c k s , 15 buses, and r e c r e a t i o n a l v e h i c l e s cannot be p l a c e d under the " f l a p s " . During the summer months r e c r e a t i o n a l v e h i c l e t r a f f i c i n c r e a s e s s u b s t a n t i a l l y , y e t i n order to lower the f l a p s , they must be r e s t r i c t e d from those l a n e s . From 1970 to 1974 c a p a c i t y was f u r t h e r i n c r e a s e d to 192 cars on these s i s t e r s h i p s by " s t r e t c h i n g them". T h i s process i n -13 The B r i t i s h Columbia F e r r y Study made a rough c a l c u l a t i o n of the gross economic impact on Vancouver I s l a n d by f e r r y users f o r August, 1973 which turned out to be $10,206,000. ^Personal I n t e r v i e w w i t h Mr. B. Bouchard, A s s i s t a n t T r a f f i c Manager, B.C. F e r r i e s . 15. Includes mobile homes, campers, t r a i l e r s , e t c . -28-v o l v e s l i t e r a l l y c u t t i n g the f e r r y i n h a l f and adding a new mid s e c t i o n . T h i s p r o c e s s , completed by B u r r a r d Dry Dock of North 16 Vancouver i n c r e a s e s the l e n g t h o f the s h i p by 84 f e e t . As summer peaking causes s e r i o u s d e l a y s , methods of e i t h e r expanding c a p a c i t y or d e c r e a s i n g the peaks are being ex-p l o r e d . Two new car and passenger f e r r i e r s were p l a c e d i n s e r v i c e i n 1976. As w e l l a t r a i l e r f e r r y w i t h a c a p a c i t y o f 64-40 f t . t r a i l e r s began s e r v i c e i n the summer o f 19 76. T h i s i s used f o r a l l 17 types o f o v e r h e i g h t v e h i c l e s . Terminal f a c i l i t i e s a t a l l f o u r l o c a t i o n s are being expanded. Four methods of d e a l i n g w i t h the peaking problem are d i s c u s s e d i n the B r i t i s h Columbia F e r r y Study. The f i r s t i n v o l v e s expanding the p r e s e n t schedules t o i n c l u d e n i g h t s a i l i n g s . T h i s i d e a , which has r e c e i v e d much p u b l i c i t y f o r a number of ye a r s , i s g e n e r a l l y favoured by the p u b l i c and t r u c k i n g companies, but r e c e i v e s much c r i t i c i s m from the Government as w e l l as B.C. F e r r i e s , mainly due to i n c r e a s e d c o s t s and labour problems. A second a l -t e r n a t i v e i n v o l v e s the i n s t a l l a t i o n o f a r e s e r v a t i o n system. T h i s s t i l l has s e v e r a l f i n a n c i a l and t e c h n i c a l d i f f i c u l t i e s to be worked out. 16 F a v e l l e , P e t e r , "The Queens of B r i t i s h Columbia", Discovery  Magazine, Vancouver, 1974. Pe r s o n a l Interview w i t h Mr. B. Bouchard, A s s i s t a n t T r a f f i c Manager, B.C. F e r r i e s . -29-The t h i r d a l t e r n a t i v e i s t o s e t up a p r i o r i t y system based on r e s i d e n c y . T h i s would g i v e I s l a n d r e s i d e n t s , then lower mainland r e s i d e n t s f i r s t p r i o r i t y i n l o a d i n g . T h i s i d e a would c r e a t e very poor p u b l i c r e l a t i o n s , e s p e c i a l l y to o u t - o f - p r o v i n c e t o u r i s t s , who are important t o the i s l a n d economy. The l a s t a l -t e r n a t i v e would i n s t i t u t e a d i f f e r e n t i a l p r i c i n g scheme w i t h r e s -p e c t to time and us e r s . Once again i t would l e a d to poor r e l a t i o n s w i t h t o u r i s t s as w e l l as to B.C. r e s i d e n t s u s i n g the f e r r y on a r e g u l a r b a s i s . Regardless of method or p o l i c y used to a l l e v i a t e the summer c a p a c i t y problems, there c o u l d be s e r i o u s consequences f o r a l l f e r r y t r a f f i c , not j u s t those u s i n g B.C. F e r r i e s . For i n s t a n c e , s i n c e t r u c k s and o v e r h e i g h t v e h i c l e s cause problems w i t h the B.C. F e r r i e s there may be new p o l i c i e s t o l i m i t , or t o t a l l y ban them except f o r the new t r a i l e r f e r r y . Such an a c t i o n may cause t r a f f i c t o move to C.P.'s f e r r y system. In any case, s i n c e f e r r y t r a f f i c i s not homogeneous, e s p e c i a l l y i n t h e i r o p e r a t i n g c h a r a c t e r i s t i c s , the e f f e c t of any new p o l i c i e s are l i k e l y t o be f e l t throughout the system. B r i t i s h Columbia C o a s t a l Steamship S e r v i c e -U n l i k e B.C. F e r r i e s , B.C.C.S.S.'s o p e r a t i o n i s not o r i e n t e d to the c a r r i a g e o f passengers and automobiles. The major p o r t i o n of t h e i r t r a f f i c c a r r y i n g s i s the movement o f , f i r s t , -30-d r o p t r a i l e r s f r o m V a n c o u v e r t o S w a r t z Bay and Nanaimo, and s e c o n d , r a i l c a r s f r o m V a n c o u v e r t o Nanaimo. U n d e r n o r m a l o p e r a -t i o n s , o n l y one o f f i v e s h i p s o p e r a t e d c a r r i e s p a s s e n g e r s . T h i s s h i p , t h e " P r i n c e s s o f V a n c o u v e r " s a i l s t h r e e t i m e s d a i l y , s e v e n d a y s a week between V a n c o u v e r and Nanaimo. D u r i n g t h e week i t c a r r i e s 35 r e s e r v e d a u t o m o b i l e s on i t s t o p d e c k . On t h e weekends, a l l s p a c e n o t o c c u p i e d by r a i l c a r s i s a v a i l a b l e f o r p a s s e n g e r s and a u t o s . D u r i n g t h e summer s e a s o n t h e " C a r r i e r P r i n c e s s " i s p l a c e d on the. V a n c o u v e r t o Nanaimo r u n f o r one s a i l i n g p e r day, i n a d d i t i o n t o h e r r e g u l a r s c h e d u l e . I n a d d i t i o n t o r a i l c a r s and t r a i l e r s , she c a r r i e s a b o u t 70 a u t o s p l u s f o o t -p a s s e n g e r s . T h i s e n a b l e s t h e " P r i n c e s s o f V a n c o u v e r " t o i n c r e a s e h e r l o a d t o 100 a u t o s . Thus B.C.C.S.S. p r o v i d e s o n l y a v e r y l i m i t e d p a s s e n g e r and automobile^, s e r v i c e . T h i s t r a f f i c , b e i n g s e c o n d a r y t o t r a i l e r s and r a i l c a r s a r e u s u a l l y c a r r i e d o n l y i f and when s p a c e i s a v a i l a b l e . B.C.C.S.S. c a r r y o n l y a v e r y s m a l l p r o p o r -t i o n o f t h i s t r a f f i c compared t o B.C. F e r r i e s , however t h e y do p r o v i d e a r e s e r v a t i o n s y s t e m f o r a l l t r a f f i c . 2.4.2 C o m m e r c i a l T r a f f i c C o m m e r c i a l t r a f f i c m o v i n g t o and f r o m t h e i s l a n d c a n be d i v i d e d i n t o t h r e e g r o u p s — r a i l c a r ; h ighway c a r r i e r s ; and -31-bulk commodities. The p r e s e n t f e r r y system between the B.C. mainland and Vancouver I s l a n d i s i n v o l v e d w i t h o n l y the f i r s t two, r a i l c a r and highway motor c a r r i e r s . R a i l c a r The requirement f o r water c a r r i a g e of r a i l c a r s comes from three sources, MacMillan B l o e d e l L t d . (M.B.), Canadian N a t i o n a l Railways (C.N.R.), and C P . R a i l (C.P.R.). Although they d i f f e r i n o r g a n i z a t i o n , each of these three e n t i t i e s p r o v i d e t h e i r own s e l f p r o p e l l e d f e r r y o p e r a t i o n . MacMillan B l o e d e l , through i t s s u b s i d i a r y t r a n s p o r t a -t i o n company Kingcome N a v i g a t i o n Co. L t d . , l e a s e s equipment from Seaspan I n t e r n a t i o n a l L t d . f o r i t s r a i l c a r movements. T h i s con-s i s t s of one s a i l i n g per week u s i n g Seaspan's 2 6 - r a i l c a r s e l f -p r o p e l l e d barge, the "Hiada T r a n s p o r t e r " . The movement i n v o l v e s lumber from M.B.'s Harmac m i l l near Nanaimo to B u r l i n g t o n Northern Inc.'s B u r r a r d I n l e t s l i p a t Vancouver. The eastbound movement u s u a l l y moves at f u l l c a p a c i t y , w h i l e the westbound r a i l c a r s are u s u a l l y empty. C.N.R. r e q u i r e s a s i n g l e d a i l y s a i l i n g to the I s l a n d to meet i t s needs. Four or f i v e days a week s a i l i n g s are d i r e c t to V i c t o r i a , w h i l e on other days drops and pickups are made at Rocky P o i n t , James I s l a n d and Cowichan Bay. To meet t h i s need, C.N.R. c o n t r a c t s the 2 4 - r a i l c a r s e l f - p r o p e l l e d barge -32-"Greg Y o r k e " , and o p e r a t o r s f r o m S e a s p a n . T h i s r a i l f e r r y makes t h e t r i p t o V i c t o r i a i n e i g h t h o u r s , and l o n g e r when ma k i n g i n t e r -m e d i a t e s t o p s . C.N.R.'s s l i p on t h e m a i n l a n d i s l o c a t e d on T i l s -b u r y I s l a n d , i n t h e s o u t h arm o f t h e F r a s e r R i v e r . The a v e r a g e p a y l o a d on t h e "Greg Y o r k e " i s a b o u t 20 r a i l c a r s , 17 l o a d e d and 3 empty on t h e e a s t b o u n d t r i p , and 3 18 l o a d e d and 17 empty on t h e w e s t b o u n d t r i p . The e a s t b o u n d t r i p , l i k e M.B. i s made up a l m o s t e n t i r e l y o f f o r e s t p r o d u c t s . The w e s t b o u n d t r a f f i c i n c l u d e s c a n n e d goods, p l a s t i c p i p e and s o d a a s h . R a i l c a r t r a f f i c o f C.P.R. i s t r a n s p o r t e d a c r o s s t h e S t r a i t o f G e o r g i a by B r i t i s h C o l u m b i a C o a s t a l S t e a m s h i p S e r v i c e , a s e p a r a t e c o s t c e n t r e o f C P . R a i l . U n l i k e t h e s t r i c t l y r a i l c a r b a r g i n g o p e r a t i o n o f M.B. and C.N.R., B.C.C.S.S.'s o p e r a t i o n s a r e more complex. H i s t o r i c a l l y B.C.C.S.S. has p r o v i d e d a r a i l c a r -f o o t p a s s e n g e r - b u l k commodity f e r r y w h i c h l a t e r e v o l v e d i n t o a r a i l c a r - a u t o m o b i l e - l i v e t r u c k f e r r y . W i t h t h e e s t a b l i s h m e n t o f B.C. F e r r i e s , and t h e i r r e s t r i c t i v e p o l i c i e s r e g a r d i n g d r o p t r a i l -e r s , B.C.C.S.S.'s s y s t e m now s p e c i a l i z e s i n c a r l o a d and d r o p t r a i l e r c o m m e r c i a l t r a f f i c . 18 J u r c z y n s k i , C , R a i l B a r g e and T r u c k i n g , Commerce 444, 1975 s t u d e n t p a p e r i n Commerce f a c u l t y . T h i s w o u l d i n c l u d e s p e c i a l i z e d r o l l i n g s t o c k s u c h as t e m p e r a t u r e c o n t r o l l e d c a r s f o r f o o d s t u f f s , e t c . , w h i c h c a n n o t be u s e d f o r t r a n s p o r t i n g f o r e s t p r o d u c t s . -33-B.C.C.S.S. operates 5 v e s s e l s , 3 B.C.C.S.S.-owned and two l e a s e d from Seaspan. The Seaspan v e s s e l s , the "Seaspan D o r i s " and the "Hiada T r a n s p o r t e r " are l e a s e d f o r one n i g h t time s a i l i n g each day. R a i l c a r s are c a r r i e d on the " P r i n c e s s of Vancouver" and the "Seaspan D o r i s " between Vancouver and Nanaimo. As C.P.R. and C.N.R. a c t i v e l y compete f o r r a i l o r i e n t e d t r a f f i c , t h e i r t r a f f i c composition i s very s i m i l a r . However, C P . s h i p s a much g r e a t e r volume,' i n the o r d e r of two times t h a t of C N . Commercial motor c a r r i e r t r a f f i c i s c a r r i e d by e i t h e r B.C.C.S.S. o r B.C. F e r r i e s . Motor c a r r i e r t r a f f i c i s made up of two types, l i v e t r u c k s and drop t r a i l e r s . L i v e t r u c k s are those u n i t s which are accompanied on the f e r r y by the d r i v e r . Drop t r a i l e r s are those u n i t s where the t r a i l e r i s detached from the power u n i t and loaded on the f e r r y by other means. The t r a i l e r i s unloaded a t the o t h e r t e r m i n a l and p i c k e d up by another power u n i t . Because mobile homes and some c o n s t r u c t i o n equipment have these same c h a r a c t e r i s t i c s , they are sent as "drops" as w e l l . ' S i n c e drop t r a i l e r s have much d i f f e r e n t h a n d l i n g char-a c t e r i s t i c s than automobiles, they have been banned on B.C. F e r r y runs. T h e r e f o r e , e s s e n t i a l l y a l l drop t r a i l e r t r a f f i c moves 19 v i a B.C.C.S.S. from Vancouver to V i c t o r i a or Nanaimo. L i v e 19 During 1973 and p a r t of 1974 T i l s b u r y I s l a n d Terminals operated a drop t r a i l e r f a c i l i t y , but t h i s was terminated i n October o f 1974. P e r s o n a l i n t e r v i e w w i t h John C o s u l i c h , Manager T i l s b u r y I s l a n d T e r m i n a l s ^ -34-t r u c k movements on B.C.C.S.S. are r e s t r i c t e d to l e f t o v e r space, and u s u a l l y l i m i t e d to unpopular s a i l i n g times. T h e r e f o r e l i v e t r u c k s are u s u a l l y c a r r i e d by B.C. F e r r i e s . B.C. F e r r i e s o f f e r f requent daytime s a i l i n g s which are a t t r a c t i v e to l i v e t r u c k s , whereas B.C.C.S.S. o f f e r s b a s i c a l l y an o v e r n i g h t s e r v i c e , w i t h only one s a i l i n g d u r i n g business hours. B.C.C.S.S. o f f e r s a r e s e r v a t i o n system as w e l l as s p e c i a l -i z e d equipment f o r h a n d l i n g drop t r a i l e r s , . t h e r e f o r e t h i s business i s e s s e n t i a l l y " c a p t i v e " . P r e s e n t l y t h e r e i s i n the neightbourhood of 350 t r a i l e r s moving d a i l y by t h i s s e r v i c e . U n l i k e the r a i l c a r movement, motor c a r r i e r s have a t r a f f i c imbalance i n favour o f westbound movements, i n the 20 order of 4 to 1 over eastbound movements. The preponderance of westbound t r u c k t r a f f i c between Vancouver and the i s l a n d i s made up of General Merchandise. T h i s i n c l u d e s g r o c e r i e s , food-s t u f f s , beer, hardware, a p p l i a n c e s , f e r t i l i z e r s , and b u i l d i n g pro-ducts. Eastbound movements i n c l u d e lumber and f o r e s t products, government m a t e r i a l s and f i s h ( s e a s o n a l ) . The flow o f mobile homes, which has been growing r a p i d l y , i s e n t i r e l y westbound. 20 . Jim Yates, Manager, B.C.C.S.S., P e r s o n a l Interview, Vancouver, B r i t i s h Columbia" 2 . 4 . 3 Bulk Commodities As mentioned e a r l i e r , the f e r r i e s o p e r a t i n g i n B r i t i s h Columbia do not handle bulk commodities. These are moved mainly by tug and barge along the B.C. coast. By f a r the most important commodity, i n terms of value and tonnage are f o r e s t p roducts. T h i s i n c l u d e s pulp and paper products as w e l l as lumber products. Gra-v e l and limestone c o n t r i b u t e s i g n i f i c a n t tonnages to coast-wise s h i p p i n g . S e r v i c e s are p r o v i d e d by a number of tug and barge companies such as Seaspan, G u l f of Georgia Towing, R i v t o v S t r a i t s and N o r t h l a n d N a v i g a t i o n , as w e l l as many s m a l l e r companies. A number of l a r g e s h i p p e r s , such as MacMillan B l o e d e l and I m p e r i a l O i l own t h e i r own barges. Chapter 3 Nature of Drop T r a i l e r T r a f f i c -37-I n t r o d u c t i o n P u b l i s h e d i n f o r m a t i o n p e r t a i n i n g t o f e r r y o p e r a t i o n s s p e c i a l i z i n g i n c o m m e r c i a l highway t r a f f i c i s e x t r e m e l y l i m i t e d . The p u r p o s e o f t h i s c h a p t e r i s t o a n a l y z e t h e o p e r a t i o n s o f B.C.C.S.S., i n c l u d i n g t h e f a c i l i t i e s and s p e c i a l e q u i p m e n t p r o -v i d e d f o r t h e c a r r i a g e o f d r o p t r a i l e r s . The a d v a n t a g e s and d i s -a d v a n t a g e s o f d r o p t r a i l e r s a r e s t u d i e d f r o m t h e p o i n t o f v i e w o f t h e s h i p p e r s , t h e m otor c a r r i e r s and t h e f e r r y c o m p a n i e s . The c h a p t e r c o n c l u d e s w i t h an a n a l y s i s o f t h e e c o n o m i c s o f s h i p p i n g v i a d r o p t r a i l e r r a t h e r t h a n l i v e t r u c k . 3.1 Drop T r a i l e r s O p e r a t i o n s 3.1.1 F a c i l i t i e s As C h a p t e r 2 p o i n t e d o u t , B.C.C.S.S. i s p r e s e n t l y t h e o n l y company t o o f f e r a f a c i l i t y f o r t h e h a n d l i n g o f d r o p t r a i l e r s . The h a n d l i n g and l o a d i n g c h a r a c t e r i s t i c s o f d r o p t r a i l e r s a r e v e r y d i f f e r e n t t h a n a u t o m o b i l e a n d p a s s e n g e r o r i e n t e d t r a f f i c . M i x i n g them on a p a s s e n g e r - a u t o o r i e n t e d f e r r y c a u s e s l o a d i n g p r o b l e m s and d e l a y s . T h e r e f o r e , an e f f i c i e n t d r o p t r a i l e r f a c i l i t y r e q u i r e s s p e c i a l i z a t i o n o f t r a f f i c h a n d l i n g methods. I n p r e v i o u s y e a r s d r o p t r a i l e r t r a n s p o r t a t i o n was p r o v i d e d by two o t h e r s o u r c e s . P r i o r t o 1968, B.C. F e r r i e s h a n d l e d d r o p t r a i l e r - 3 8 -t r a f f i c , but on a much l e s s s p e c i a l i z e d b a s i s . I t was i n t h a t year t h a t the government announced drop t r a i l e r s would onl y be handled on a r e s t r i c t e d b a s i s . + In 1 9 7 3 i t was announced t h a t drop t r a i l e r t r a f f i c would be banned a l t o g e t h e r . In 1 9 7 1 , T i l s b u r y I s l a n d Terminals L t d . i n i t i a t e d a drop t r a i l e r f a c i l i t y from t h e i r t e r m i n a l on T i l s b u r y I s l a n d to 2 Cowichan Bay on Vancouver I s l a n d . They used a tug and barge to p r o v i d e the t r a n s p o r t a t i o n . T h i s s e r v i c e was d i s c o n t i n u e d i n 1 9 7 4 . S e v e r a l problems were c i t e d , i n c l u d i n g o p e r a t i n g problems w i t h the tug and barge arid i t was only a m a r g i n a l l y economic ven-t u r e . T i l s b u r y s t i l l operate a drop t r a i l e r s e r v i c e to P r i n c e Rupert and the Queen C h a r l o t t e I s l a n d s , t r a n s p o r t i n g 1 6 - 1 8 40 foot' t r a i l e r s per week of g e n e r a l f r e i g h t . B.C.C.S.S. p r o v i d e t h e i r f e r r y s e r v i c e a t the downtown t e r m i n a l from two b e r t h s , known as P i e r s A - l and A - 3 . Both p i e r s are capable of h a n d l i n g a l l types of r o l l i n g stock; e.g.: r a i l -c a r s , drop t r a i l e r s , autos, mobile homes and i n d u s t r i a l equipment. P i e r A - 3 i s an a l l weather p i e r , whereas P i e r A - l cannot handle From 1968 u n t i l 1 9 7 3 / drop t r a i l e r s were handled on l y d u r i n g the evening runs of the w i n t e r months. T i l s b u r y I s l a n d Terminals L t d . i s a s u b s i d i a r y of R i v t o v S t r a i t s L i m i t e d . 'Personal I n t e r v i e w w i t h (Capt.) John C o s u l i c h , Manager, T i l s b u r y I s l a n d Terminals L t d . -39-r a i l c a r s at extreme hi g h or low t i d e s . P i e r A-3 a l s o has f a c i l i t i e s f o r h a n d l i n g f o o t passengers. One of the prime f e a t u r e s of the drop t r a i l e r concept i s the a b i l i t y of the motor c a r r i e r s t o l i t e r a l l y drop t h e i r t r a i l e r s a t any time d u r i n g the day of the s a i l i n g . T h e r e f o r e , the f a c i l i t y must p r o v i d e adequate space f o r the p a r k i n g of t r a i l e r s . Space i s a l s o r e q u i r e d f o r t r a i l e r s unloading from Nanaimo or Swartz Bay. These a r r i v e mainly i n the l a t e evening or e a r l y morning and must be p i c k e d up d u r i n g t h a t day, due to the l i m i t e d area of p a r k i n g . U n l i k e B.C. F e r r i e s , B.C.C.S.S. p r o v i d e s a r e s e r v a t i o n system f o r i t s customers. For t h i s s e r v i c e , a t r a f f i c o f f i c e was s e t up w i t h a T r a f f i c S u p e r v i s o r . T h i s person i s i n touch w i t h the d i s p a t c h e r s of the major users to determine t h e i r space requirements t h a t day. These spaces, on each p a r t i c u l a r s a i l i n g , are r e s e r v e d f o r t h a t customer. In a d d i t i o n the t r a f f i c s u p e r v i s o r i s i n d a i l y communication w i t h C P . R a i l o f f i c i a l s f o r t h e i r r a i l c a r requirements. A f t e r r e s e r v a t i o n s have been taken and a l l o c a t e d f o r drop t r a i l e r s , the t r a f f i c s u p e r v i s o r w i l l accept r e s e r v a t i o n s f o r h a n d l i n g l i v e ( d r i v e r accompanied) u n i t s . These are g i v e n on B.C.C.S.S. Report of B . C C S .S. Operations P. 1, Vancouver January, 1975. -40-s a i l i n g s where space i s a v a i l a b l e . T h i s i s u s u a l l y l i m i t e d to the not so popular s a i l i n g s , such as the 0145 to Swartz Bay, or the noon to Vancouver. R e s e r v a t i o n s are a v a i l a b l e f o r passenger c a r s through the Wharf T i c k e t O f f i c e . That o f f i c e i s assigned spaces 5 i n l i n e w i t h the requirements o f the T r a f f i c S u p e r v i s o r . Thus the r e s e r v a t i o n system i s based on c e r t a i n p r i o r i t i e s , but s e t up such t h a t maximum u t i l i z a t i o n o f space i s achieved. The B.C.C.S.S.,, though s p e c i a l i z i n g i n drop t r a i l e r s r e q u i r e s a l l three types of t r a f f i c i n o r d e r to maintain i t s c u r r e n t o p e r a t i o n o f f i v e v e s s e l s . 3.1.2 S p e c i a l Equipment P r i o r t o 1973 drop t r a i l e r s were loaded onto the s h i p s by the t r a c t o r s and d r i v e r s o f the companies who d e l i v e r e d them. Larger companies w i t h s e v e r a l t r a i l e r s would a s s i g n o n l y a few t r a c t o r s t o perform the l o a d i n g f u n c t i o n . T h i s system was un-s a t i s f a c t o r y as i t r e q u i r e d the d r i v e r and t r a c t o r to w a i t a t the p i e r s u n t i l l o a d i n g , r e s u l t i n g i n i d l e time. Loading was not completed i n the most o r d e r l y f a s h i o n due to c o n g e s t i o n caused by the number o f u n i t s w a i t i n g to l o a d . The longer time spent l o a d i n g and unloading i n c r e a s e d turnaround times. I n J u l y , 1973, B.C.C.S.S. adopted the " H o s t l i n g " concept ^ I b i d . , p. 6. ^ P e r s o n a l Interview w i t h Mr. Jim Yates, Manager, B.C.C.S.S., Van-couver . -41-f o r h a n d l i n g drop t r a i l e r s . Under t h i s system, t r a i l e r s are loaded and unloaded by a s p e c i a l 2 a x le t r a c t o r equipped w i t h a h y d r a u l i c "5th wheel". T h i s u n i t can hook up to a t r a i l e r , h y d r a u l i c a l l y l i f t i t , and move i t i n t o p l a c e , without having to perform the time-consuming task of manually r a i s i n g and lowering the t r a i l e r ' s p a r k i n g l e g s . T h i s system allows the t r u c k i n g companies to use t h e i r d r i v e r s and t r a c t o r s f o r o t h e r purposes a f t e r dropping o f f the t r a i l e r . I t a l s o p r o v i d e s time savings and r e l i a b i l i t y to the l o a d i n g and unloading f u n c t i o n . The d r i v e r s and h o s t l e r s are p r o v i d e d f o r under an agreement w i t h three t r u c k i n g companies, Johnston T e r m i n a l s , 7 C a p i t a l Freightways, and C P . T r a n s p o r t . Under the agreement these companies p r o v i d e the s e r v i c e i n t u r n f o r an h o u r l y wage as w e l l as a guarantee of 15 hours per day. B.C.C.S.S. recovers the c o s t of the h o s t l e r s through the c u r r e n t t a r i f f . g The r a t e charged i s $6.75 per u n i t l o a d i n g or unloading. There are p r e s e n t l y f i v e h o s t l i n g u n i t s o p e r a t i n g i n q Vancouver, one i n Swartz Bay and none i n Nanaimo. Vancouver has the l a r g e s t f a c i l i t y as i t handles t r a f f i c from both I s l a n d t e r -minals . 7 B.C.C.S.S., Report on Operations, p. 6. 8B.CC.S.S. T a r i f f No. 8. Both C P . T r a n s p o r t and Johnston Terminals are l o c a t e d i n the immediate v a c i n i t y of B.C.C.S.S.'s p a r k i n g l o t i n Nanaimo, t h e r e f o r e a h o s t l i n g s e r v i c e i s not p r o v i d e d . -42-Vessels B.C.C.S.S. currently operates f i v e vessels on i t s two main routes to the is l a n d . These are: "Princess of Vancouver" "Carrier Princess" " T r a i l e r Princess" "Seaspan Doris" "Hiada Transporter" The f i r s t three ships are owned by B.C.C.S.S., the remaining two by Seaspan, but under contract to B.C.C.S.S. U n t i l the mid 1950's B.C.C.S.S. operated s i x towed barges serving three i s l a n d points. The " T r a i l e r Princess", b u i l t during World War I I , was the f i r s t s e l f - p r o p e l l e d ferry to be put into service. The "Princess of Vancouver" was subsequently b u i l t s p e c i f i c a l l y for B.C.C.S.S. The newest vessel, the "Carrier Princess" was put into service i n 1973. The following table and diagram present d e t a i l s regarding the ships, t h e i r capacities, routes and schedules. TABLE 3.1 B.C.C.S.S. VESSEL STATISTICS* CAPACITY' Ship Railcars T r a i l e r s Autos Princess of Vancouver 2 8 30 35 (2 decks) (top deck) Ca r r i e r Princess (1 deck) 28 40 T r a i l e r Princess (1 deck) 8(loaded) 2 8 Seaspan Doris (2 decks) 24 45 (main deck) (2 decks) Hiada Transporter (1 deck) -- 32 *Source: B.C.C.S.S. - 4 3 -EXHIBIT 3.1 BC.CSS SCHEDULE R o u t e s Time (a) Ex V a n c o u v e r S h i p To A r r i v e V a n c o u v e r S a i l i n g Time Time S h i p From 0145 CP SB 3 1/2 h r s . 0 800 TP SB 0400 PV N 2 1/2 h r s . 0830 SD N 1200 PV N 2 1/2 h r s . 0845 CP SB 1730 CP SB 3 1/2 h r s . 1030 PV NAN 2000 PV NAN 2 1/2 h r s . 1830 PV NAN 2100 TP SB 5 h r s . 2445 CP SB 2100 HT NAN 3 h r s . 0230 PV NAN 2315 SD NAN 3 1/4 h r s . 0400 HT NAN SHIP NAN. 0800 1600 2400 •PV-•HT SD 0400 •1200 2000 •2100 •2315 S.B. VAN. D i s t a n c e Van. t o S w a r t z Bay « 47 m i l e s . Van. t o Nanaimo = 36 m i l e s . - 4 4 -Notes: (a) During the summer season the C a r r i e r P r i n c e s s i s p l a c e d i n s e r v i c e between Vancouver and Nanaimo, l e a v i n g Vancouver a t 10:00 a.m. and r e t u r n i n g a t 1:30. T h i s s a i l i n g i s i n response to heavy t o u r i s t t r a f f i c . E x h i b i t 3.1 shows t h a t there i s only one daytime s a i l i n g from Vancouver. T h i s leaves a t noon, bound f o r Nanaimo. Thus the s e r v i c e B.C.C.S.S. p r o v i d e s i s b a s i c a l l y o v e r n i g h t , which i s t h a t r e q u i r e d by i t s major customers, the t r u c k i n g companies. These companies a d v e r t i s e a next day d e l i v e r y s e r v i c e from Vancouver, thus B.C.C.S.S.'s schedule of l a t e n i g h t c r o s s i n g s s u i t s them ,,10 w e l l . 3.2 Advantages/Disadvantages of Drop T r a i l e r s 3.2.1 Motor C a r r i e r s The use of the drop t r a i l e r system of moving t r a i l e r s to Vancouver I s l a n d has prove.de'3 to be advantageous t o both the s u p p l i e r of the s e r v i c e , as w e l l as to the u s e r s . For the user of t h i s f a c i l i t y , arrangements must be made f o r the d e l i v e r y and pickup of the t r a i l e r a t each s i d e . Thus the s e r v i c e i s most a t t r a c t i v e t o t r u c k i n g companies or p r i v a t e s h i p p e r s who have sub-s t a n t i a l o p e r a t i o n s on both the mainland and Vancouver I s l a n d , and P e r s o n a l Interview, w i t h Mr. Chubb Bawa o f Johnston T e r m i n a l s . s h i p volumes of t r a c t o r and s e m i - t r a i l e r s i z e . The main advantage to the user of the f a c i l i t y i s the e l i m i n a t i o n of i d l e time f o r the power u n i t and the d r i v e r d u r i n g w a i t i n g and s a i l i n g time. Under the drop t r a i l e r concept t h i s i d l e time i s e l i m i n a t e d by simply dropping o f f the t r a i l e r p r i o r to s a i l i n g , and going about other b u s i n e s s . The r e s e r v a t i o n system allows the users to schedule t h e i r hauls to the t e r m i n a l . S i n c e space i s guaranteed on c e r t a i n s a i l -i n g s , they can d e l i v e r the t r a i l e r t o the t e r m i n a l a t t h e i r con-venience. T h i s g i v e s t h e i r o p e r a t i o n added f l e x i b i l i t y •. The r e s e r v a t i o n a l s o e l i m i n a t e s the chance of having to w a i t f o r a f e r r y - a d i s t i n c t p o s s i b i l i t y f o r l i v e t r u c k s on B.C. F e r r i e s . One f i n a l advantage i s the p r i o r i t y g i v e n to commercial t r a i l e r t r a f f i c over passengers and automobiles. For B.C.C.S.S., the major p o r t i o n of t h e i r t r a f f i c i s the movement of drop t r a i l e r s between Vancouver, Swartz Bay and Vancouver. L i v e t r u c k s , passengers and autos are taken on s a i l i n g s only where space i s a v a i l a b l e . For some users of the f a c i l i t y , the downtown l o c a t i o n i s very convenient to t h e i r o p e r a t i o n s . Johnstons, C a p i t a l F r e i g h t -ways and C P . T r a n s p o r t would a l l f i t i n t o t h i s group. A t r i p to Horseshoe Bay or Tsawwassen would add c l o s e to an hour on to -46-t h e i r d e l i v e r y time. For other companies, the l o c a t i o n i s not so convenient. These companies are u s u a l l y l o c a t e d on the p e r i -phery of Vancouver. Access to the t e r m i n a l r e q u i r e s a t r i p through the h e a r t o f downtown Vancouver. T h i s i n v o l v e s a time consuming t r i p o f t e n i n heavy t r a f f i c on r e s t r i c t e d t r u c k r o u t e s . Drop t r a i l e r s a l s o p r o v i d e s e v e r a l advantages f o r B.C.C.S.S. over other types o f t r a f f i c . F i r s t , i n order f o r a company t o take advantage o f the economics o f drop t r a i l e r s , they must s h i p enough r e g u l a r t r a f f i c t o support having a t l e a s t one t r a c t o r and d r i v e r on each t e r m i n a l . Thus the s e r v i c e appeals to a s m a l l number of users who account f o r l a r g e volumes of t r a f f i c . T h i s makes f o r e a s i e r communication between B.C.C.S.S. and i t s customers. The r e s e r v a t i o n system allows f o r c a r e f u l p l a n n i n g and s c h e d u l i n g of s a i l i n g s . Spaces not r e s e r v e d f o r commercial v e h i c l e s are assign e d f o r passenger cars and l i v e t r u c k s . As a r e s u l t o f t h i s system, maximum u t i l i z a t i o n o f a v a i l a b l e space i s made on a l l v e s s e l s . On the v e s s e l s the "Hiada T r a n s p o r t e r " and the "Seaspan D o r i s " , no passengers are c a r r i e d at a l l . Thus v e s s e l crews are kept t o a minimum, and customer s e r v i c e s need not be p r o v i d e d . The " C a r r i e r P r i n c e s s " (on r e g u l a r runs) and the " T r a i l e r P r i n c e s s " l i m i t passengers t o d r i v e r s of l i v e u n i t s . Again t h i s enables B.C.C.S.S. to m a i n t a i n s m a l l crews and l i m i t s e r v i c e s . - 4 7 -Since the s e r v i c e p r o v i d e d (and required) i s o v e r n i g h t , and r e g u l a r passengers are not c a r r i e d on f o u r out of f i v e v e s s e l s , B.C.C.S.S. i s a b l e to make use of o l d e r and slower v e s s e l s such as the " T r a i l e r P r i n c e s s " . In a f l e e t such as B.C. F e r r i e s which i s geared to passenger car t r a n s p o r t and r a p i d turnarounds such a v e s s e l would be uneconomic to operate. One of the problems w i t h t h i s t r a f f i c however, i s the l a r g e amount of space which i s r e q u i r e d f o r p a r k i n g the t r a i l e r s b e f o r e l o a d i n g , or a w a i t i n g pickup. The Vancouver f a c i l i t y must handle the combined volumes of Nanaimo and Swartz Bay. Due to the s i z e of t r a i l e r s , h a n d l i n g i s cumbersome, and l o a d i n g and unloading i s much slower than passenger c a r s , even w i t h s p e c i a l -i z e d equipment such as h o s t l e r s . 3.3 Economics of Drop T r a i l e r s The f e r r y system i s an important and v i t a l l i n k i n the Island-Mainland t r a n s p o r t a t i o n system. T h i s system has been viewed by many as an e x t e n s i o n of the highway system. In t h i s r e g a r d the demand f o r f e r r y t r a n s p o r t a t i o n o f commercial drop t r a i l e r s can be viewed as an i n t e r m e d i a t e demand, as i s the demand f o r t r u c k t r a n s p o r t , which i s d e r i v e d from the demand f o r the f i n a l product. 3.3.1 Ecoriomic Advantages - 4 8 -R a t h e r t h a n i n d i v i d u a l segments o f t h e t r a n s p o r t f u n c t i o n , t h e f e r r y and t r u c k i n g s e r v i c e c a n be v i e w e d as e l e m e n t s o f a t o t a l d i s t r i b u t i o n s y s t e m . T h i s s y s t e m w o u l d i n c l u d e a l l t h e c o s t s and f u n c t i o n s o f m o v i n g goods t o t h e f i n a l consumer. D i s t r i b u t i o n c o s t s h a v e been r a p i d l y i n c r e a s i n g o v e r t h e p a s t d e c a d e o r s o , e s p e c i a l l y on consumer g o o d s . Thus any s i g n i f i c a n t r e d u c t i o n i n t h e d i s t r i b u t i o n c o s t s w o u l d g e n e r a t e s u b s t a n t i a l s a v i n g s i n t h e c o s t o f t h e f i n a l p r o d u c t . I n t h i s r e g a r d , d r o p t r a i l e r f e r r y s e r v i c e has p r o v i d e d a d e f i n i t e a d v a n -t a g e o v e r l i v e t r u c k t r a n s p o r t on t h e t o t a l d i s t r i b u t i o n c o s t s f r o m V a n c o u v e r t o t h e I s l a n d f o r s e v e r a l u s e r s . T h i s c o s t a d v a n t a g e i s a c h i e v e d w i t h o u t any l o s s i n f l e x i b i l i t y o r r e l i a b i l i t y o f s e r v i c e . The e c o n o m i c a d v a n t a g e t o t r u c k i n g f i r m s o f u s i n g d r o p t r a i l e r s c a n be m e a s u r e d i n d o l l a r t e r m s . T h i s i s a c h i e v e d by means o f a c o m p a r a t i v e a n a l y s i s o f t h e c o s t s a s s o c i a t e d w i t h s h i p p i n g by d r o p t r a i l e r , as w e l l as t h e c o s t s w i t h t h e a l t e r n a -t i v e — s h i p p i n g by l i v e t r u c k . 3.3.2 Time S a v i n g s The m a i n a d v a n t a g e t o a u s e r o f t h e d r o p t r a i l e r s e r v i c e i s t h e e l i m i n a t i o n o f i d l e t r u c k and d r i v e r t i m e . Thus t h e f i r s t s t e p i n t h e a n a l y s i s i s t o c o n s t r u c t t h e t r i p t i m e s v i a e a c h method. F o r t h e p u r p o s e s o f t h i s a n a l y s i s t r a v e l t i m e t o t h e - 4 9 -f e r r y t e r m i n a l s w i l l be assumed to be e q u a l . In r e a l i t y , t h i s may not be t r u e , as i t would depend on the l o c a t i o n o f the s h i p p e r ' s t e r m i n a l , the routes taken, the time of the t r i p , and the l e v e l of congestion a t t h a t time o f day. By s e t t i n g the d e l i v e r y times e q u a l , the a n a l y s i s i s r e s t r i c t e d to the f e r r y voyages, and the economies o f drop t r a i l e r s per se, and not a c h o i c e of r o u t e s . Thus the a n a l y s i s begins a t the time of d e l i v e r y to the f a c i l i t y . As w e l l i t i s assumed the d e l i v e r y of the t r a i l e r w i l l be made to the s h i p p e r s f a c i l i t y i n Nanaimo or V i c t o r i a . T h i s s i m p l i f i e s the a n a l y s i s by i g n o r i n g d e l i v e r i e s to v a r i o u s l o c a t i o n s and t r a i l e r unloading. However, s i n c e the major t r u c k i n g f i r m s h a u l mainly from t h e i r Vancouver Terminal to t h e i r I s l a n d t e r m i n a l s , t h i s assumption i s r e a l i s t i c . The a n a l y s i s t h e r e f o r e , c o n f i n e s i t s e l f s t r i c t l y t o f e r r y p o r t i o n o f the t r i p , so the same l o c a t i o n of t e r m i n a l f a c i l i t i e s i s assumed. The times used i n Table 3.2 are based on normal t r i p times expe r i e n c e d by t r u c k i n g companies and of f e r r y schedules. They are r e p r e s e n t a t i v e of the time i t would take f o r each step under normal c o n d i t i o n s . -50-TABLE 3.2 COMPARISON OF TRIP TIMES TO VANCOUVER ISLAND  FOR DROP TRAILERS VERSUS LIVE  UNITS L i v e U n i t Drop T r a i l e r  (min.) T r a c t o r D r i v e r T r a i l e r W a iting Time 45 135 Loading Time 20 30 S a i l i n g Time 110 180 Unloading Time 10 30 Wa i t i n g Time 12 0 D e l i v e r y t o Co. D i s t . Center 30 30 30 30 Return to F e r r y T e r m i n a l 30 30 30 30 Wa i t i n g Time 40 135 Loading Time 2 0 30 S a i l i n g Time 1.10 180 1' Unloading Time 10 30 T o t a l Minutes 425 60 60 930 Note 1. Combined s a i l i n g time between Swartz Bay and Vancouver would be 1 hour longer. The above c a l c u l a t i o n s do not i n c l u d e time f o r lunch breaks, e t c . Nor does i t i n c l u d e p r o v i s i o n f o r e x t r a charges such as meals and s u b s i s t a n c e , s i n c e these would vary c o n s i d e r a b l y a c c o r d i n g to each company. Thus the d i f f e r e n c e i n costs w i l l be l i m i t e d t o those a t t r i b u t e d to i d l e time of the t r a c t o r and d r i v e r due' to c r o s s i n g as a l i v e u n i t . -51-The r e s u l t s c o n t a i n e d i n T a b l e 3.2 a r e v e r y s i g n i f i c a n t . T h i s t a b l e shows t h a t f o r a t y p i c a l t r i p t o t h e i s l a n d , a l i v e u n i t r e q u i r e s an a d d i t i o n a l 6 h o u r s and 5 m i n u t e s o f t r a c t o r and d r i v e r t i m e o v e r and above t h a t r e q u i r e d by a d r o p t r a i l e r . On t h e o t h e r hand, t h e u s e o f d r o p t r a i l e r s r e q u i r e s an a d d i t i o n a l 8 h o u r s and 25 m i n u t e s o f t r a i l e r t i m e . T h e s e t i m e s a r e u s e d i n S e c t i o n 3.3.4 i n t h e d e t e r m i n a t i o n o f t h e n e t b e n e f i t s o f d r o p t r a i l e r s . B e f o r e t h a t c a l c u l a t i o n c a n t a k e p l a c e , t h e c o s t o f u s i n g e a c h f a c i l i t y must be i n c l u d e d as t h e y v a r y between c a r r i e r s . T h i s i s t h e s u b j e c t o f t h e n e x t s u b - s e c t i o n . 3.3.3 R a t e S c h e d u l e s The r a t e s f o r l i v e u n i t s a r e c o n t a i n e d i n t h e t a r i f f p u b l i s h e d by B.C. F e r r i e s , and t h o s e for* d r o p t r a i l e r s i n B.C.C. S.S.'s tariff . " ' " ' ' " B.C. F e r r i e s T a r i f f i s a c o m p l e x p u b l i c a t i o n c o n -t a i n i n g o v e r 65 p a g e s o f r u l e s , r e g u l a t i o n s , f a r e s and c h a r g e s . B.C.C.S.S.'s t a r i f f i s much s h o r t e r , c o n t a i n i n g o n l y 8 p a g e s . The r a t e s c o n t a i n e d i n t h e s e t a r i f f s a r e : P r o v i n c e o f B r i t i s h C o l u m b i a - P a s s e n g e r & F e r r y T a r i f f No. 1, B.C. F e r r i e s , V i c t o r i a , B.C. and B.C.C.S.S. T a r i f f No. 8, e f f e c t i v e J a n u a r y 1, 1975, S u p p l e m e n t , J u n e 1976. -52-TABLE 3.3 A. B. B.C. F e r r i e s FERRY CHARGES 12 Trucks, T r a i l e r s (commercial)" 1"^ minimum charge up to 20 f e e t ; $26.00: over 20 f e e t ; $1.10 per f o o t t h e r e a f t e r . Note: - r a t e s i n c l u d e d r i v e r - u n i t s over 65' must o b t a i n s p e c i a l p e r m i s s i o n - commercial u n i t s are those over 12,000 GVW B.C.C.S.S 13 To Nanaimo To V i c t o r i a Trucks, T r a i l e r s : up to 20' To Nanaimo: Trucks, T r a i l e r s 21 t o 26' 27 to 31' 32 to 36' 37 to 41* 41 to 45* $48.00 52.00 59.00 63.00 69.00 $39.00 $48.00 To Swartz Bay $60.00 69 .00 79.00 85.00 94.00 over 45' -each a d d i t i o n a l f o o t 1.47 Mobile Homes To Nanaimo 1.78 To Swartz Bay 36 - 40' (12' wide) over 40' per a d d i t i o n a l f o o t Handling Charges Nanaimo Load Unload Trucks & T r a i l e r s 7.25 7.25 Mobile Homes 12.50 12.50 $98.60 1.55 Vancouver Load Unload 6.75 6.75 12.50 12.50 $124.60 2. 30 Swartz Bay Load Unload 6. 75 6.75 12 • B.C. F e r r i e s o f f e r s a d i s c o u n t f o r major customers, known as "commercial s c r i p t " . T h i s i s a v a i l a b l e f o r minimum purchases of $200 and amounts to a 10% d i s c o u n t . 13 B.C.C.S.S. o f f e r s a d i s c o u n t to major users of 10%. -53-F o r c o m p a r a t i v e p u r p o s e s , t h e s e r a t e s a r e g r a p h e d i n E x h i b i t 3.2. A number o f o b s e r v a t i o n s s h o u l d be n o t e d w i t h r e s -p e c t t o t h e s e r a t e s : (1) B.C. F e r r i e s u s e t h e same r a t e f o r t h e i r r o u t e s 1 and 2. B.C.C.S.S. u s e d i f f e r e n t r a t e s f o r e a c h r o u t e . (2) The B.C.C.S.S. r a t e f o r a 45 f o o t t r a i l e r o n t h e V a n c o u v e r t o S w a r t z Bay r o u t e i s $2 3.00, h i g h e r (30%) t h a n on t h e V a n c o u v e r - N a n a i m o r u n . (3) The r a t e s a r e c o n s i d e r a b l y h i g h e r on B.C.C.S.S. t h a n on B.C. F e r r i e s . F o r example, a 45 f o o t u n i t on B.C.C.S.S.'s V a n c o u v e r - N a n a i m o r u n w o u l d c o s t $69.00 and $48.50 on B.C. F e r r i e s . T h i s amounts t o a d i f f e r e n c e o f 42.3 p e r c e n t . The d i f f e r e n c e i s $9 4.00 v s . $48.50 on t h e V a n c o u v e r - S w a r t z Bay r u n , o r 94% h i g h e r on B.C.C.S.S. (4) A l l r a t e s a r e b a s e d on t h e l e n g t h o f t h e u n i t r a t h e r t h a n GVW. V e h i c l e s p a c e c a p a c i t y i s r e a c h e d much s o o n e r t h a n w e i g h t c a p a c i t y . 1 ^ (5) A t t h e t i m e C r i l l y d i d h i s a n a l y s i s , t h e r a t e s i n e f f e c t ( J u l y , 1972) were c l o s e f o r b o t h c a r r i e r s , w i t h B.C.C.S.S. m o d e r a t e l y h i g h e r . 1 5 S i n c e t h a t t i m e B.C.C.S.S. has i n c r e a s e d t h e i r r a t e s by a p p r o x i m a t e l y 14 P e r s o n a l I n t e r v i e w w i t h Mr. B. B o u c h a r d , B.C. F e r r i e s . 15 C r i l l y , M.L., A n a l y s i s o f B.C. F e r r i e s , U n p u b l i s h e d M a s t e r s T h e s i s , U.B.C., 1973. 1 0 0 A 90 H R A T E $ ( o n e w a y ) 80 70 H 60 50 40 30 2 0 10 S o u r c e : EXHIBIT 3.2 C O M M E R C I A L F E R R Y R A T E S 1. V a n c o u v e r - S w a r t z B a y ( i n c l u d e s l o a d i n g / u n l o a d i n g ) 2 . V a n c o u v e r - N a n a i m o ( i n c l u d e s l o a d i n g ) B . C . F E R R I E S 3 . C o m m e r c i a l T r u c k R a t e s R o u t e s 1 a n d 2 4 . 1 9 7 1 D r o p T r a i l e r R a t e s —i— 10 20 30 40 L E N G T H O F V E H I C L E ( f e e t ) 50 60 B . C . F e r r i e s , P a s s e n g e r a n d F e r r y T a r i f f N o . 1 B . C . C . S . S . , T a r i f f N o . 8 -55-70% w h i l e B.C. F e r r i e s ' has had one i n c r e a s e i n June 1976 of about 23% on t r a f f i c 60' i n l e n g t h . The 10% s c r i p t i s s t i l l i n e f f e c t . (6) E x h i b i t 3.2 a l s o c o n t a i n s the r a t e s f o r drop t r a i l e r s when they were p e r m i t t e d on B.C. F e r r i e s . A t t h a t time, they were h i g h e r than B.C.C.S.S.'s r a t e s to Nanaimo, and much h i g h e r than B . C . . F e r r i e s ' t r u c k r a t e s . The rate-was doubled i f B.C. F e r r i e s were t o perform the l o a d i n g and unloading. From Table 3.2 an estimate o f the time savings f o r s h i p p i n g by drop t r a i l e r r a t h e r than l i v e t r u c k was 6 hours and 5 minutes f o r the d r i v e r and t r a c t o r u n i t . The t r a i l e r however, i n c u r r e d a longer t r i p time of 8 hours and 20 minutes, due to longer w a i t i n g times and o v e r n i g h t d e l i v e r y . The d i f f e r e n c e of 6 hours and 5 minutes i s very s i g n i f i c a n t . Because of i t s magni-tude the t r a c t o r and d r i v e r c o u l d use t h i s time f o r o t h e r h a u l s . S i m i l a r i l y , i f there were a number o f t r a i l e r s moving to the i s l a n d , then some t r a c t o r s or d r i v e r s c o u l d be e l i m i n a t e d from t h i s h aul a l t o g e t h e r . For example one c u r r e n t user of the f a c i l i t y s h i p s an average of 12 t r a i l e r s t o the i s l a n d d a i l y . SiK of these go to V i c t o r i a and s i x to Nanaimo. The V i c t o r i a ones are d e l i v e r e d l o c a l l y , but the Nanaimo t r a i l e r s are d e l i v e r e d to C e n t r a l I s l a n d r e g i o n . Thus two d r i v e r s and t r a c t o r s are s t a t i o n e d i n V i c t o r i a , and t h r e e i n Nanaimo. A l l shipments o r i g i n a t e i n the c e n t r a l Vancouver warehouse, t h e r e f o r e approximately 3 u n i t s are - 5 6 -r e q u i r e d to move the t r a i l e r s to the f e r r y t e r m i n a l . A t o t a l of e i g h t d r i v e r s and t r a c t o r s are r e q u i r e d t o move these 12 t r a i l e r s d u r i n g a normal workday. I f l i v e t r u c k movements were used, then each l o a d would r e q u i r e a d r i v e r and t r a c t o r f o r a t o t a l of 12. T h e r e f o r e by u s i n g the drop t r a i l e r f a c i l i t i e s , t h i s user cuts h i s d r i v e r and t r a c t o r requirements by one t h i r d . In the case of t r a i l e r s the r e v e r s e i s t r u e . Due to the longer w a i t i n g times, o v e r n i g h t s e r v i c e , and longer s a i l i n g times, each one way movement takes one day. Thus a c a r r i e r has to double the number of t r a i l e r s he would need f o r l i v e u n i t s . Thus the c o s t of c a r r y i n g e x t r a t r a i l e r s w i l l be r e f l e c t e d i n i n c r e a s e d t r a i l e r c o s t f o r drop t r a i l e r s as opposed to l i v e t r u c k s . 3.344 T r i p Costs In order to determine the d o l l a r value of the time savings r e s u l t i n g from the e l i m i n a t i o n of i d l e time on the f e r r y , the c o s t of the t r i p from the time the u n i t reaches the f e r r y t e r m i n a l u n t i l i t r e t u r n s i s estimated. The c o s t s used are those g i v e n by v a r i o u s t r u c k i n g f i r m s . S i n c e the movement i n v o l v e d c i t y d e l i v e r y , h o u r l y r a t e s are g i v e n . For a f u r t h e r d i s c u s s i o n of l i n e h a u l c o s t s , r e f e r to the appendix to t h i s chapter. In the area of t r a n s p o r t a t i o n c o s t i n g , one i s o f t e n f a c e d w i t h the fundamental q u e s t i o n of which c o s t i n g method i s more a p p r o p r i a t e . Should f u l l y d i s t r i b u t e d c o s t s be a p p l i e d , or -57-m a r g i n a l c o s t i n g ? I n t h i s c a s e , and t h e t r u c k i n g i n d u s t r y i n g e n e r a l , t h e q u e s t i o n has l i t t l e m eaning s i n c e t h e two a r e v i r t u a l l y t h e same. T h e r e a r e s e v e r a l r e a s o n s why f u l l y d i s t r i b u t e d c o s t s a r e a p p r o p r i a t e i n t h e t r u c k i n g i n d u s t r y where t h e y may n o t be i n o t h e r i n d u s t r i e s s u c h as t h e r a i l r o a d . The f i r s t , and most i m p o r t a n t r e a s o n i s t h e n a t u r e o f t r u c k i n g c o s t s . U n l i k e t h e r a i l w a y s w h i c h have a h i g h d e g r e e o f l o n g t e r m f i x e d c o s t s , t r u c k i n g c o s t s a r e f o r t h e most p a r t v a r i a -b l e . The t r u c k i n g i n d u s t r y has v e r y l i t t l e i n v e s t e d i n l o n g t e r m a s s e t s . The a s s e t s o f t h e i n d u s t r y a l s o t u r n o v e r r a p i d l y . T h i s makes f o r a v e r y h i g h o p e r a t i n g r a t i o . S e c o n d l y , most c o s t s a r e t r a c e a b l e i n t h e t r u c k i n g i n d u s t r y . Much o f t h e o v e r h e a d c o s t s s u c h as b i l l i n g , i n t e r e s t and i n s u r a n c e c o s t s , c o u l d be t r a c e d , and do i n d e e d v a r y w i t h t h e l e v e l o f p r o d u c t i o n . Thus a p r o f i t m a r g i n c a n n o t be i g n o r e d i n t h e c o s t i n g o f s e r v i c e s . I n t h e c a s e o f d r o p t r a i l e r s , t h e p o t e n t i a l t i m e s a v i n g s a r e v e r y s u b s t a n t i a l . F o r t h e m a j o r u s e r s o f t h e f a c i l i t i e s t h e s e s a v i n g s c o u l d r e p r e -s e n t t h e e l i m i n a t i o n o f a number o f t r a c t o r s . Thus t h e use o f f u l l y d i s t r i b u t e d c o s t s f i n d s i t s j u s t i f i c a t i o n e v e n t h o u g h i n t h i s c a s e , t h e y a r e a p p r o x i m a t e l y e q u a l t o i n c r e m e n t a l c o s t s . ^ The v e h i c l e o p e r a t i n g c o s t s u s e d i n c a l c u l a t i n g a d o l l a r v a l u e o f t h e t i m e s a v i n g s o f u s i n g a d r o p t r a i l e r r a t h e r t h a n a l i v e u n i t a r e as f o l l o w s : 16 Bowersox, Amykay, L a L o n d e , P h y s i c a l D i s t r i b u t i o n Management, The M a c M i l l i a n Company, T o r o n t o , 1970. -58-TABLE 3.4 TRUCK COSTS T r a c t o r ( d r i v i n g ) (non d r i v i n g 3.3 8) T r a i l e r D r i v e r O v e r h e a d P r o f i t S o u r c e : A p p e n d i x t o C h a p t e r 3. The t r a c t o r c o s t s a r e made up o f d e p r e c i a t i o n , f u e l , m a i n t e n a n c e and r e p a i r s , l i c e n s e , i n s u r a n c e and m i s c e l l a n e o u s c o s t s s u c h as s p e c i a l e q u i p m e n t and c l e a n i n g . The t r a i l e r c o s t s c o v e r d e p r e c i a t i o n , c l e a n i n g , l i c e n s e and i n s u r a n c e . The d r i v e r wage i s b a s e d on t h e c o n t r a c t w i t h t h e T e a m s t e r s U n i o n and w o u l d be t h e same f o r most c o m p a n i e s . T h i s w o u l d be t h e b a s i c wage p l u s f r i n g e b e n e f i t s . The o v e r h e a d c o s t i s t a k e n a t 14% o f r e v e n u e w h i c h i s c l o s e t o t h e i n d u s t r y a v e r a g e . T h i s w o u l d c o v e r t h o s e c o s t s w h i c h a r e common t o a l l t h e h a u l i n g o f a company. I n c l u d e d w o u l d be management, c l e r i c a l and s u p e r v i s o r y s a l a r i e s , . b i l l i n g and a c c o u n t i n g , s a l e s e x p e n s e s , t e r m i n a l c o s t s , i n t e r e s t on e q u i p m e n t , e t c . The p r o f i t f i g u r e i s b a s e d on an o p e r a t i n g r a t i o o f 90%. U s i n g t h e r e s u l t s f r o m T a b l e 3.4, t h e f i g u r e f o r t h e v a l u e o f t h e t i m e s a v i n g s c a n be e a s i l y d e t e r m i n e d . However, t h i s w o u l d n o t be t o t a l l y c o r r e c t s i n c e t h e c o s t o f u s i n g t h e d i f f e r e n t $/Hour 6.90 .68 9.62 3.17 2.26 $22.63 -59-f a c i l i t i e s v a r i e s . Thus t h e d i f f e r e n c e i n t h e t r i p c o s t s f o r t h e l i v e u n i t s and d r o p t r a i l e r s c a n be d e t e r m i n e d u s i n g t h e p r e -v i o u s l y d e t e r m i n e d t r i p t i m e s . S i n c e t h e f e r r y c h a r g e s f o r d r o p t r a i l e r s v a r y f o r t h e two r o u t e s , t h e S w a r t z Bay and Nanaimo r o u t e s , c a l c u l a t i o n s a r e shown s e p a r a t e l y . When t h e t r a c t o r i s i d l e on t h e f e r r y no f u e l o r r e p a i r c h a r g e s a r e i n c l u d e d . L i v e U n i t s V e h i c l e C o s t s ( o p e r a t i n g ) (2' h r s . ) $ 45.26 V e h i c l e C o s t s ( n o n - o p e r a t i n g ) (5.08 h r s . ) 97.09 D r i v e r O v e r t i m e 8.02 F e r r y C o s t s 136.70 $ 287.07 Drop T r a i l e r (To Nanaimo) V e h i c l e C o s t s (60 min.) $ 22.63 E x t r a T r a i l e r Time (14.5 h r s . ) 9.86 F e r r y C o s t s 137.25 $ 169.74 Drop T r a i l e r (To S w a r t z Bay) V e h i c l e C o s t s (60 min.) $ 22.63 E x t r a T r a i l e r Time (15.5 h r s . ) 10.54 F e r r y C o s t s 181.83 $ 215.00 The c o s t o f s h i p p i n g a t r a i l e r as a l i v e u n i t as o p p o s e d t o a d r o p t r a i l e r r e s u l t s i n a w e i g h t e d a v e r a g e c o s t o f a p p r o x i -17 m a t e l y $99.20. Thus f o r f i r m s who s h i p a l a r g e number o f 17 As shown i n t h e n e x t c h a p t e r , d r o p t r a i l e r t r a f f i c e x h i b i t s a 60:40 s p l i t i n f a v o r on t h e Nanaimo o v e r V i c t o r i a r o u t e s . -60-t r a i l e r s , a nd have o p e r a t i o n s a t e a c h t e r m i n a l , s h i p p i n g v i a d r o p t r a i l e r c a n r e p r e s e n t v e r y s u b s t a n t i a l s a v i n g s . The s a v i n g s o f $117.33 by d r o p t r a i l e r t o Nanaimo r e p r e s e n t 40.87% o f t h e l i v e u n i t c o s t . The h i g h e r c o s t o f s e n d i n g a u n i t by B.C. F e r r i e s t h a n by B.C.C.S.S. must be b o r n e by t h e s h i p p e r o f t h e goods , and u l -t i m a t e l y by t h e f i n a l consumer. T h e s e e x t r a c o s t s may e v e n be h i g h e r as i n t h e c a s e where a s h i p m e n t i s made t o a p o i n t o u t s i d e Nanaimo o r V i c t o r i a . T h i s t y p e o f t r i p w o u l d i n c u r e x t r a d r i v e r o v e r t i m e . T h e r e f o r e t h e $99.20 w e i g h t e d a v e r a g e s a v i n g s i s a low e s t i m a t e . Summary f T h i s c h a p t e r r e v i e w s t h e o p e r a t i o n s o f d r o p t r a i l e r s b e t ween t h e I s l a n d and t h e B.C. M a i n l a n d . The a d v a n t a g e s o f t h i s t y p e o f s e r v i c e a r e o u t l i n e d . The mai n a d v a n t a g e i s f o u n d t o be t h e e l i m i n a t i o n o f i d l e t r a c t o r and d r i v e r t i m e w h i c h made i t a l o w e r c o s t method t h a n l i v e t r u c k . O t h e r a d v a n t a g e s were t h e c o n v e n i e n c e and f l e x i b i l i t y o f t h e s e r v i c e . The d i s a d v a n t a g e i s t h e g r e a t l y i n c r e a s e d t r a i l e r t i m e s f o r a r e t u r n t r i p . F i n a l l y , t h e a d v a n t a g e i n d o l l a r terms i s e s t i m a t e d f o r a f i r m u s i n g t h e d r o p t r a i l e r f a c i l i t y r a t h e r t h a n l i v e t r u c k s v i a B.C. F e r r i e s . T h i s was c a l c u l a t e d a t a p p r o x i m a t e l y $99.00 w h i c h i s a v e r y s u b s t a n t i a l s a v i n g i n d e e d . I t r e p r e s e n t s 40% o f -61-t h e c o s t o f s h i p p i n g by l i v e t r u c k , o r 5 8% o f t h e c o s t o f s h i p p i n g by d r o p t r a i l e r t o Nanaimo, and 46% t o S w a r t z Bay. APPENDIX TO CHAPTER 3 VEHICLE OPERATING COSTS The p u r p o s e o f t h i s a p p e n d i x i s t o o u t l i n e t h e method o f c a l c u l a t i n g v e h i c l e o p e r a t i n g c o s t s . T h e s e c o s t s may v a r y some-what d e p e n d i n g upon s e v e r a l f a c t o r s s u c h as t h e c a r r i e r s t y p e o f o p e r a t i o n ; a n n u a l u t i l i z a t i o n s , a r e a o f o p e r a t i o n , and t y p e o f p r o d u c t s h a u l e d . Thus t h e s e c o s t s a r e r e p r e s e n t a t i v e o n l y and s h o u l d n o t be c o n s i d e r e d p e r c i s e f o r a p a r t i c u l a r h a u l t o t h e I s l a n d . I M e t h o d o l o g y The c o s t s d e v e l o p e d i n t h i s a p p e n d i x a r e b a s e d on u s i n g a t r a c t o r o n l y f o r l o c a l h a u l i n g (as o p p o s e d t o l i n e h a u l i n g ) a n d a v a n t r a i l e r . The r e a s o n f o r t h i s i s t h a t p h y s i c a l l y , a t r a c t o r h a u l i n g o n l y l o c a l h a u l s ( i n c l u d i n g V a n c o u v e r I s l a n d ) w i l l d i f f e r f r o m a l i n e h a u l t r a c t o r w h e r e a s t h e l i n e h a u l t r a c t o r ' s c o s t s a r e m a i n l y d i s t a n c e r e l a t e d and e x p r e s s e d as a p e r m i l e c o s t , t h e l o c a l t r a c t o r ' s c o s t s a r e t i m e r e l a t e d and e x p r e s s e d as a c o s t p e r h o u r . The v a n t y p e t r a i l e r i s u s e d i n t h i s a n a l y s i s as i t i s t h e most common t y p e u s i n g t h e d r o p t r a i l e r f a c i l i t i e s . The u t i l i z a t i o n o f e q u i p m e n t i s b a s e d on 5000 h o u r s p e r y e a r , w h i c h r e q u i r e s b a s i c a l l y a 24 h o u r o p e r a t i o n by a c a r r i e r . However, t h i s t y p e o f o p e r a t i o n i s common t o t h o s e c a r r i e r s u s i n g t h e d r o p t r a i l e r f a c i l i t i e s . -63-I I O p e r a t i n g C o s t s A. T r a c t o r s (1) D e p r e c i a t i o n : The d e p r e c i a t i o n c h a r g e f o r t r a c t o r s i s b a s e d on <% u s e f u l l i f e o f 5 y e a r s , o r 600,000 m i l e s , and a r e s i d u a l v a l u e o f 2 0%. The c a p i t a l c o s t o f t h e t r a c t o r was t a k e n as 4 5,0 00 i n c l u d i n g a l l p r o v i n c i a l t a x e s . B a s e d on t h e c o n c e p t t h a t p e r i o d i c r e c o v e r y o f an i n v e s t m e n t o v e r i t s l i f e i s c o m p r i s e d o f b o t h p r i n c i p l e a n d i n t e r e s t , t h e f o l l o w i n g d e p r e c i a -t i o n f o r m u l a i s u s e d : C C - R.V.. d + i ) n - — = a n n u a l c h a r g e a m where: C C = C a p i t a l C o s t R.V = R e s i d u a l V a l u e n = Y e a r s o f L i f e i = I n t e r e s t R a t e a n i = P r e s e n t V a l u e o v e r n y e a r s a t i r a t e o f i n t e r e s t (2) D r i v e r s Wages: T h e s e a r e b a s e d on t h e c u r r e n t T e a m s t e r s c o n t r a c t . F o r t r i p s o f u n d e r 100 m i l e s d r i v e r s a r e p a i d on an h o u r l y b a s i s . T h i s was $8.02 p e r h o u r f o r r e g u l a r t i m e . O v e r t i m e up t o 10 h o u r s p e r day i s $4.01 p e r h o u r and f r i n g e b e n e f i t s a r e c a l c u l a t e d a t 18% o f g r o s s s a l a r i e s . (3) L i c e n s e : C a l c u l a t e d a t an a n n u a l r a t e o f ^ 1 2 0 0 p e r y e a r . (4) I n s u r a n c e : I n s u r a n c e c o s t s a r e d i f f i c u l t t o d e t e r m i n e as t h e y w i l l v a r y w i t h e a c h c a r r i e r d e p e n d i n g upon t h e i r -64-s a f e t y r e c o r d , i n s u r e r , e t c . I n t h i s c a s e a f i g u r e o f $3450 was t a k e n as i t r e p r e s e n t s a p p r x o i m a t e l y 3% o f r e v e n u e w h i c h i s t y p i c a l o f t h e i n d u s t r y . (5) F u e l : F u e l was c a l c u l a t e d a t 7 2 < r / g a l l o n , and an a v e r a g e c o n s u m p t i o n f i g u r e o f 4 g a l l o n s p e r h o u r f o r c i t y d r i v i n g u s e d . (6) T i r e s ; A n n u a l t i r e c o s t s f o r a t r a c t o r was t a k e n as*2400 w h i c h i s t h e a p p r o x i m a t e c o s t o f e q u i p p i n g a t r a c -t o r o n c e p e r y e a r . (7) M i s c e l l a n e o u s : T h i s c o s t c a t e g o r y i n c l u d e s r e p a i r s , d a i l y m a i n t e n a n c e , c l e a n i n g and e x t r a e q u i p m e n t s u c h as t a r p s , e t c . B. T r a i l e r s (1) D e p r e c i a t i o n ; The u s e f u l l i f e o f t h e t r a i l e r f o r d e p r e c i a t i o n p u r p o s e s i s e i g h t y e a r s w i t h a r e s i d u a l v a l u e o f 10%. The c a p i t a l c o s t o f a new t r a i l e r u s e d i n t h i s example i s 10,000 and t h e f o r m u l a u s e d i n t h e c a l c u l a t i o n o f t h e a n n u a l c h a r g e i s : C C - R.V ( 1 + i ) n — = a n n u a l c o s t a n i T a b l e A c o n t a i n s t h e breakdown o f t h e c o s t s f o r l o c a l h a u l i n g . The t o t a l o p e r a t i n g c o s t s c o n t a i n o n l y " o u t o f p o c k e t -65-c o s t s " . The f u l l y d i s t r i b u t e d c o s t s a r e f o u n d by i n c l u d i n g s u c h common c o s t s as a d m i n i s t r a t i v e s a l a r i e s , b i l l i n g a nd c o l l e c t i n g c o s t s , and i n t e r e s t c o s t s . F o r t h e t r u c k i n g i n d u s t r y , t h e s e c o s t s a v e r a g e a r o u n d 14% p e r y e a r . The f i n a l a d j u s t m e n t t o d e t e r m i n e f u l l y a l l o c a t e d c o s t s i s a p r o f i t a l l o w a n c e . The most common method i s t h r o u g h t h e o p e r a t i n g r a t i o ( o p e r a t i n g c o s t s / o p e r a t i n g r e v e n u e ) . F o r a f i r m t o be p r o f i t a b l e , t h i s r a t i o must be l e s s t h a n one. A common t r u c k i n g i n d u s t r y a v e r a g e t a r g e t i s an o p e r a t i n g r a t i o o f .90. TABLE A  VEHICLE OPERATING COSTS COSTS A. TRACTORS $/HOUR - D e p r e c i a t i o n 1.9 8 - D r i v e r Wages 9.62 - L i c e n s e .24 - I n s u r a n c e .69 - F u e l 2.88 - M i s c e l l a n e o u s .50 - T i r e s .48 T r a c t o r Sub T o t a l $16.52 B. TRAILERS j - D e p r e c i a t i o n .33 - L i c e n s e .10 •- M i s c e l l a n e o u s . 25 T r a i l e r Sub T o t a l $ .68 T o t a l O p e r a t i n g C o s t s 17.20 F u l l y D i s t r i b u t e d C o s t s 20.37 F u l l y D i s t . C o s t s + P r o f i t 22.63 C h a p t e r 4 The N a t u r e o f Drop T r a i l e r T r a f f i c -67-I n t r o d u c t i o n I n t h i s c h a p t e r t h e c h a r a c t e r i s t i c s o f d r o p t r a i l e r t r a f f i c a r e e x a m i n e d . T h i s i n c l u d e s t h e t y p e o f p r o d u c t s w h i c h move by d r o p t r a i l e r and t h e m a j o r u s e r s o f t h e f a c i l i t i e s . The s i z e o f t h e m a r k e t i s s t u d i e d by r e v i e w i n g t h e t r a i l e r v o l u m e s moving o v e r t h e p a s t 7 y e a r s . A number o f r e c e n t d e v e l o p m e n t s and t r e n d s r e g a r d i n g t h i s t r a f f i c i s a n a l y z e d . The c h a p t e r c o n -c l u d e s w i t h a p r o j e c t i o n o f d r o p t r a i l e r v o l u m e s f o r t h e n e x t f i v e y e a r s . 4.1 C h a r a c t e r i s t i c s o f Drop T r a i l e r T r a f f i c 4.1.1 C o m m o d i t i e s The p r e p o n d e r e n c e o f t r a f f i c c a r r i e d between t h e I s l a n d and t h e M a i n l a n d i n s e m i - t r a i l e r e q u i p m e n t i s g e n e r a l m e r c h a n d i s e and consumer g o o d s . T h e s e c o m m o d i t i e s c a n be d i v i d e d i n t o an e a s t b o u n d and w e s t b o u n d d i r e c t i o n , as w e l l as by t r u c k l o a d and l e s s t h a n t r u c k l o a d l o t s . The m a j o r w e s t b o u n d t r u c k l o a d c o m m o d i t i e s a r e f o o d s t u f f s , meat, b e e r , h a r d w a r e , a p p l i a n c e s , p a c k a g e d p e a t m o s s , f e r t i l i z e r , b u i l d i n g m a t e r i a l s , c o n c r e t e , p i p e and s t e e l . A b o u t 75 p e r c e n t o f t h e s e c o m m o d i t i e s move i n v a n t y p e t r a i l e r s and t h e r e s t on f l a t d e c k s . T h e r e i s some h e a v y e q u i p m e n t moved as w e l l on low-boy t r a i l e r s . T h e s e c o m m o d i t i e s a l l o r i g i n a t e f r o m t h e l o w e r m a i n --68-l a n d . T r u c k l o a d movements o r i g i n a t i n g f r o m i n l a n d p o i n t s bound f o r V a n c o u v e r I s l a n d a r e m a i n l y f r u i t s f r o m t h e Okanagan V a l l e y and l i q u o r f r o m W i n f i e l d . W estbound l e s s - t h a n - t r u c k l o a d t r a f f i c i s m a i n l y g e n e r a l m e r c h a n d i s e s e n t i n l o t s o f 500-5000 l b s . The b u l k o f t h i s t r a f f i c i s h a n d l e d i n v a n t y p e t r a i l e r s by t h e two m a j o r c a r r i e r s ( C P . and J o h n s t o n T e r m i n a l s ) who o f f e r p i c k u p and d e l i v e r y s e r v i c e s . T h e s e s h i p m e n t s a r e c o n s o l i d a t e d a t t h e c a r r i e r s ' t e r m i n a l s and s e n t . i n t r a i l e r l o a d s o f 30,000-35,000 l b s . E a s t b o u n d t r u c k l o a d c o m m o d i t i e s a r e m a i n l y lumber p r o -d u c t s , w i t h some movements o f w i n e and g r a p e s . On a s e a s o n a l b a s i s , i c e - p a c k e d f i s h a r e moved. The g o v e r n m e n t w a r e h o u s e i n V i c t o r i a i s t h e s o u r c e o f some t r a f f i c s u c h as r o a d s i g n s and p r i n t e d m a t t e r . E a s t b o u n d g e n e r a l m e r c h a n d i s e i n l e s s - t h a n -t r u c k l o a d l o t s a r e v i r t u a l l y n o n - e x i s t a n t . I n 1972 a new t y p e o f commodity began t o move i n s i g -n i f i c a n t q u a n t i t i e s . I n t h a t y e a r o v e r 500 m o b i l e homes were c a r r i e d as d r o p t r a i l e r s . I n 1973 t h i s i n c r e a s e d t o o v e r 1500, and r e a c h e d 2200 i n 1974. I n d i c a t i o n s a r e t h a t t h i s movement t a p e r e d o f f r a p i d l y i n 19 75, a r e s u l t o f t h e g e n e r a l e c o n o m i c s l o w -down . 1 ^ P e r s o n a l I n t e r v i e w w i t h Mr. J . Y a t e s , Manager, B.C.C.S.S. 4.1.2 U s e r s T h i s s e c t i o n examines t h e u s e r s o f t h e d r o p t r a i l e r f a c i l i t i e s . The p u r p o s e i s t o i d e n t i f y t h e m a j o r u s e r s , d e t e r m i n e t h e n a t u r e o f t h e i r demand; and s t u d y t h e c h a r a c t e r i s t i c s o f t h e i r d r o p t r a i l e r o p e r a t i o n . The a v e r a g e number o f d a i l y t r a i l e r movements t o t h e I s l a n d was e s t i m a t e d f r o m c o n v e r s a t i o n s w i t h p e r s o n n e l o f t h e f i r m s i n v o l v e d , B.C.C.S.S., and a s t u d e n t p a p e r by C. J u r c z y n s k i . The number o f t r a i l e r s r e t u r n i n g f r o m t h e i s l a n d w i l l be s l i g h t l y l e s s , a r e s u l t o f s t a c k i n g empty f l a t d e c k s t h r e e h i g h . The w e s t -bound movements o f d r o p t r a i l e r s a r e shown i n T a b l e 4.1 b e l o w . TABLE 4.1 DROP TRAILER VOLUMES BY MAJOR USERS-WESTBOUND  Company T r a i l e r s p e r Day J o h n s t o n T e r m i n a l s 55 C P . T r a n s p o r t 35 Domans T r a n s p o r t 22 C a p i t a l F r e i g h t w a y s 20 Safeway 12 S i d n e y F r e i g h t L i n e s 6 Route o f t h e H i a d a s 6 G r a s s i c k T r a n s p o r t 6 I n t e r c i t y T r a n s p o r t 4 I d e a l F u e l and T r a n s p o r t 4 M a i r s T r a n s p o r t 3 Nabob T r a n s p o r t 3 TOTAL 187 S o u r c e : J o h n s t o n T e r m i n a l s , C P . T r a n s p o r t , B.C.C.S.S. 2 J u r c z y n s k i , C , o p . c i t . , p. 16. -70-The o u t s t a n d i n g f a c t i n T a b l e 4.1 i s t h e s m a l l number o f f i r m s w h i c h a c c o u n t f o r t h e b u l k o f t h e t r a i l e r movements. U n l i k e B.C. F e r r i e s w h i c h c a t e r t o t h o u s a n d s o f u s e r s , B.C.C.S.S.'s d r o p t r a i l e r t r a f f i c i s d e r i v e d f r o m v e r y few f i r m s . J o h n s t o n T e r m i n a l s w h i c h i s t h e l a r g e s t , c o m p r i s e s a b o u t 30 p e r c e n t o f t h e t o t a l t r a f f i c . The f i v e l a r g e s t f i r m s , w h i c h w i l l be d i s c u s s e d f u r t h e r , a c c o u n t f o r a l m o s t 80 p e r c e n t o f t h e t r a f f i c . J o h n s t o n T e r m i n a l s and C P . T r a n s p o r t h a v e e s s e n t i a l l y t h e same t y p e o f o p e r a t i o n . They a r e b o t h common c a r r i e r s and have c o l l e c t i o n and d i s t r i b u t i o n t e r m i n a l s b a s e d i n V a n c o u v e r . A p p r o x i m a t e l y 91-95 p e r c e n t o f a l l s h i p m e n t s o r i g i n a t e i n G r e a t e r V a n c o u v e r and t h e l o w e r m a i n l a n d . P i g g y b a c k s h i p m e n t s f r o m e a s t e r n Canada a c c o u n t f o r o n l y a v e r y s m a l l p r o p o r t i o n (1-5 p e r c e n t ) o f 3 t r a i l e r movements t o t h e I s l a n d . S i n c e most s h i p m e n t s a r e l e s s -t h a n - t r u c k l o a d ( L T L ) , t h e y a r e p i c k e d u p , c o n s o l i d a t e d a t t h e t e r m i n a l s , and s e n t on t h e f e r r i e s as f u l l t r u c k l o a d s . J o h n s t o n ' s e s t i m a t e 9 0 p e r c e n t o f t h e i r t r a i l e r movements t o t h e i s l a n d a r e a 4 r e s u l t o f t h i s method. V B o t h C a p i t a l F r e i g h t w a y s and Domans T r a n s p o r t b e g an as p r i v a t e t r u c k e r s , — Domans f o r t r a n s p o r t i n g l umber f r o m Duncan t o V a n c o u v e r , and C a p i t a l f o r h a u l i n g v e g e t a b l e s f r o m V a n c o u v e r t o 3 P e r s o n a l I n t e r v i e w w i t h Mr. L. Buswood, Manager, C P . T r a n s p o r t , V a n c o u v e r , B.C. 4 P e r s o n a l I n t e r v i e w w i t h Mr. C. Bawa, J o h n s t o n T e r m i n a l s , V a n c o u v e r , B.C. -71-V i c t o r i a . C a p i t a l , w h i c h s e r v e s o n l y V i c t o r i a , was s e t up i n t h e 1960's t o move g e n e r a l m e r c h a n d i s e w i t h t h e v e g e t a b l e s . They have a 100 p e r c e n t empty b a c k h a u l . Domans, w h i c h p u r c h a s e d M a r p o l e T r a n s p o r t and o b t a i n e d a g e n e r a l m e r c h a n d i s e p e r m i t , h a u l lumber f r o m Duncan v i a Nanaimo, and b a c k h a u l e d c o n s t r u c t i o n m a t e r -i a l t o t h e i s l a n d . They have a l m o s t an e q u a l e a s t w e s t movement o f g o o d s . Canada Safeway i s t h e o n l y p r i v a t e c a r r i e r o f t h e f i v e l a r g e s t u s e r s . They s u p p l y 18 s t o r e s on t h e i s l a n d (10 i n V i c -t o r i a ) f r o m a c e n t r a l d i s t r i b u t i o n w a r e h o u s e i n B u r n a b y . The t r a f f i c i s s p l i t e v e n l y between V i c t o r i a and Nanaimo, w i t h s i x 5 t r a i l e r s m o v i n g t o e a c h , d a i l y . A l l o f t h e f i v e c a r r i e r s n o t e d above u s e B.C.C.S.S.'s s y s t e m o f d r o p t r a i l e r s e x c l u s i v e l y . The u s e o f l i v e t r u c k s on B.C. F e r r i e s w o u l d a r i s e o n l y on s p e c i a l o c c a s i o n s o r emergency s i t u a t i o n s . 4.1?3 T r a f f i c Volumes The volume o f t r u c k , t r a i l e r and r a i l c a r movements were o b t a i n e d t h r o u g h B.C.C.S.S. The d a t a f o r t r u c k s and t r a i l e r s c o n t a i n s l i v e t r u c k as w e l l as d r o p t r a i l e r s . However l i v e t r u c k s and o t h e r e q u i p m e n t movement a c c o u n t s f o r l e s s t h a n 5 p e r c e n t o f 5 P e r s o n a l I n t e r v i e w w i t h Mr. M.T. O l i v e r , Manager T r u c k i n g O p e r a t i o n s , Canada Safeway S t o r e s , V a n c o u v e r , B.C. -72-t o t a l , so t h e i r numbers a r e r e l a t i v e l y u n i m p o r t a n t . " T a b l e 4.2 c o n t a i n s t h e v o l u m e s f o r t h e p a s t s e v e n y e a r s . The s p l i t o f d r o p t r a i l e r t r a f f i c between t h e two r o u t e s was n o t a v a i l a b l e . F o r i l l u s t r a t i v e p u r p o s e s , t h e T a b l e 4.2 f i g u r e s a r e p r e s e n t e d i n E x h i b i t 4.1. Upon e x a m i n a t i o n o f t h i s e x h i b i t a few f a c t o r s a r e n o t e d : (1) On b o t h B.C.C.S.S. r o u t e s , d r o p t r a i l e r movements have been i n c r e a s i n g . T h i s i n c r e a s e has b e e n most s p e c t a c u l a r on t h e V a n c o u v e r - S w a r t z Bay r o u t e . The o v e r a l l i n c r e a s e i n d r o p t r a i l e r s s i n c e 1967 has b e e n 58 p e r c e n t , o r an a n n u a l i n c r e a s e o f 7.2 8 p e r c e n t . (2) R a i l c a r movements have been d e c l i n i n g s i n c e 19 6 8 a t an a v e r a g e a n n u a l r a t e o f 5 p e r c e n t . I t s h o u l d be n o t e d however, t h a t t h e l a r g e s t d r o p s were i n 1970 and 1974. B o t h t h e s e y e a r s e x p e r i e n c e d slumps i n t h e w o r l d demand f o r lumber and f o r e s t p r o d u c t s . (3) The volume o f d r o p t r a i l e r s c a r r i e d on B.C.C.S.S. r e p r e s e n t s t h e t o t a l number o f u n i t s m o ving t o and f r o m t h e i s l a n d . S i n c e B.C. F e r r i e s have b a n n e d d r o p s i n 1973, t h i s t r a f f i c i s 100 p e r c e n t c a p t i v e t o B.C.C.S.S. T h i s w o u l d a c c o u n t f o r some o f t h e l a r g e i n c r e a s e n o t e d i n 19 74. (4) G r e a t d i f f i c u l t y was e n c o u n t e r e d i n d e t e r m i n i n g what s h a r e o f t r a c t o r - t r a i l e r movements t o t h e i s l a n d , B.C.C.S.S.'s 6 P e r s o n a l I n t e r v i e w w i t h Mr. J . Y a t e s , Manager, B.C.C.S.S. TABLE 4.2 TRAFFIC VOLUMES - B.C.C.S.S. 1968 1969 1970 R a i l c a r s V a n c o u v e r - Nanaimo 25,715 26,249 21,471 N e t Change 2.0% -18.2% T r u c k s & T r a i l e r s V a n c o u v e r - Nanaimo 41,334 40,738 38,216 V a n c o u v e r - S w a r t z Bay 14,352 17,176 19,20 3 T o t a l 55,686 57,914 57,419 N e t Change 4.0% -0.8% S o u r c e : B.C.C.S.S. T r a f f i c Volumes 1971 1972 1973 1974 1975 1976 22,196 21,493 20,396 17,692 17,590 20,581 3.3% -4.5% -5.1% -13.3% -.8% +17% 41,601 45,965 44,562 50,576 23,323 25,657 31,321 37,474 64,924 71,622 75,883 88,053 85,841 92,224 13.0% 10.3% 6.0% 16.0% -2.6% +7.4% i o U) I EXHIBIT 4.1 B.C.C.S.S. ANNUAL TRAFFIC VOLUMES 90 10 1 0 J 1 1 t r 1 1 1 1 1 — 1968' . 1969 1970 1971 1972 1973 1974 1975 1976 YEAR . NOTE: 1. T r u c k - T r a i l e r s , V a n c o u v e r - S w a r t z Bay 2. T r u c k - T r a i l e r s , V a n c o u v e r - N a n a i m o S o u r c e : B.C.C.S.S. -75-volume r e p r e s e n t e d . I n o t h e r w o rds, how many t r a c t o r t r a i l e r u n i t s went by l i v e t r u c k r a t h e r t h a n d r o p t r a i l e r ? The g r e a t e s t o b s t a c l e i n a r r i v i n g a t a s o l u t i o n was B.C. F e r r i e s ' c l a s s i f i c a t i o n o f t r a f f i c . T h e i r t o t a l s i n c l u d e a l l c o m m e r c i a l u n i t s o f 12,000 GVW. T h i s w o u l d i n c l u d e d e l i v e r y t r u c k s , s t r a i g h t t r u c k s , p a n e l t r u c k s , e t c . T h e r e f o r e t h e i r f i g u r e s a r e somewhat m e a n i n g l e s s f o r compara-7 t i v e p u r p o s e s . (5) The t r a f f i c v o l u m e s p r e s e n t e d i n d i c a t e a w e s t b o u n d t r a f f i c s p l i t o f 60:40 i n f a v o r o f Nanaimo. T h i s s p l i t , has b e en n a r r o w i n g c o n t i n u o u s l y o v e r t h e y e a r s shown. 4.1.4 T r a f f i c P e a k i n g Y e a r l y V a r i a t i o n s The g r e a t e s t p r o b l e m f a c i n g B.C. F e r r i e s i s t h e s e v e r e p e a k i n g d u r i n g t h e summer months, J u l y and A u g u s t , where e f f e c t i v e u t i l i z a t i o n i s a l m o s t 100 p e r c e n t . The u n d e r l y i n g r e a s o n , f o r t h e p e a k i n g i s t h e demand c r e a t e d by t o u r i s t s , w h i c h r e p r e s e n t o v e r 70 p e r c e n t o f t h e t r i p s d u r i n g J u l y and A u g u s t . Much o f t h i s demand i s c r e a t e d by u s e r s f r o m o u t s i d e B.C. F o r t u n a t e l y f o r b o t h B.C.C.S.S. and B.C. F e r r i e s s e a s o n -a l p e a k i n g i s n o t a c h a r a c t e r i s t i c o f t h e c o m m e r c i a l t r a f f i c m o v i n g t o and f r o m t h e i s l a n d . The l a r g e s t demand f o r t r u c k t r a n s -p o r t a t i o n i s f o r t h e movement o f consumer goods and g e n e r a l mer-7 C r x l l y , i n h i s a n a l y s i s o f B.C. F e r r i e s e s t i m a t e d t h e s p l i t was a p p r o x i m a t e l y 50:50. -76-c h a n d i s e . T h i s r e m a i n s c o n s t a n t t h r o u g h o u t t h e y e a r w i t h o n l y v e r y s l i g h t i n c r e a s e s d u r i n g t h e summer v a c a t i o n months. The demand f o r t r a n s p o r t i n g lumber p r o d u c t s e a s t w a r d t o t h e m a i n l a n d i s s u b -j e c t t o some f l u c u a t i o n s , however due t o t h e e x c e s s t r a i l e r c a p a -c i t y m o v i n g i n t h a t d i r e c t i o n , t o t a l movements w i l l n o t be a f f e c t e d . T h i s a l s o a p p l i e s t o f i s h p r o d u c t s w h i c h t e n d t o be s e a s o n a l . Weekly V a r i a t i o n s U n der n o r m a l c i r c u m s t a n c e s , t h e r e i s v e r y l i t t l e v a r i a -t i o n i n v o l u m e s m o v i n g d u r i n g t h e weekdays. The weekends however, a r e g e n e r a l l y r e s t r i c t e d t o t r a f f i c o t h e r t h a n d r o p s , e s p e c i a l l y r a i l c a r and p a s s e n g e r . B . C . C . S . S . ' s two l e a s e d f e r r i e s do n o t r u n on t h e weekends. D a i l y V a r i a t i o n s B . C . C . S . S . ' s f e r r y s c h e d u l e i s s e t i n l i n e w i t h t h e r e -q u i r e m e n t s o f t h e d r o p t r a i l e r t r a f f i c . . The demand f o r s u c h a f e r r y s e r v i c e t a k e s p l a c e b e f o r e and a f t e r t h e n o r m a l b u s i n e s s h o u r s o f t h e day. L i k e w i s e , B . C . F e r r i e s e x p e r i e n c e a t r e m e n -dous demand f r o m c o m m e r c i a l t r u c k s on t h e f i r s t r u n o f t h e day a t 7:00 a.m. T h i s o f t e n c a u s e s an o v e r l o a d s i t u a t i o n where some u n i t s must be l e f t b e h i n d f o r a l a t e r s a i l i n g . B . C . C . S . S T ' S d a i l y volumes p e r s a i l i n g a r e p r e s e n t e d i n E x h i b i t 4.2. The most o u t s t a n d i n g i t e m t o n o t e i s t h a t o n l y a b o u t 5 p e r c e n t o f t h e d r o p t r a i l e r t r a f f i c i s c a r r i e d between 9:00 a.m. and 5:30 . The most p o p u l a r t i m e s a r e between 8:00 p.m. and m i d -- 7 7 -n i g h t . B.C.C.S.S.'s l a r g e s t s h o r e crew b e g i n s i t s s h i f t a t 4:00 p.m. f o r l o a d i n g and u n l o a d i n g t h e t r a i l e r s . T h i s crew i s composed o f one t r a f f i c s u p e r v i s o r , f i v e " h o s t l e r s " , and two shoremen. The o t h e r two s h i f t s u t i l i z e t h e s u p e r v i s o r and shore-men, b u t d e c r e a s e t h e number o f h o s t l e r s . EXHIBIT 4.2 DAILY DROP TRAILER TRAFFIC: B.C.C.S.S. I ex V a n c o u v e r a r r i v e V a n c o u v e r - 40 ^ 35 CQ 3 0 ^ U -1 25 i (ti u * 20-| m o . 15 o 10 -5 -Noon 8 10 I 12 PM M i d n i g h t 6 .AM 4 I 10 Noon TIME S o u r c e : B.C.C.S.S. O p e r a t i o n s R e p o r t 4.1.5 T r a f f i c P a t t e r n s The d o m i n a n t t r a f f i c p a t t e r n i n I s l a n d - M a i n l a n d f r e i g h t t r a n s p o r t a t i o n t o d a y i s t h e d i r e c t i o n a l s p l i t o f v o l u m e s by v e h i -c l e mode. As s t a t e d e a r l i e r , t h e t r u c k i n g i n d u s t r y s u f f e r s f r o m a f r e i g h t i m b a l a n c e o f 4 t o 1 i n f a v o r o f w e s t b o u n d movements. The i m b a l a n c e i s e v e n more p r o n o u n c e d f o r t h e r a i l w a y s , a r a t i o o f 6 t o 1 i n f a v o r o f e a s t b o u n d t r a f f i c . Thus t h e p r i n c i p l e t r a n s -p o r t a t i o n p r o b l e m i s one o f an i n e f f i c i e n t u s e o f e q u i p m e n t c a u s e d by empty b a c k h a u l s . The o r i g i n s o f t h e m odal s p l i t p r o b l e m c a n be f o u n d i n t h e d e v e l o p m e n t o f t h e economy o f V a n c o u v e r I s l a n d . The e c o n o m i c b a s e o f t h e i s l a n d i s c e n t e r e d on i t s ' f o r e s t i n d u s t r y and i m m e d i a t e d e r i v a t i v e s . More r e c e n t l y , t h e c l i m a t i c and a e s t h e t i c a t t r a c t i o n s h a v e g i v e n r i s e t o a l a r g e r e t i r e m e n t p o p u l a t i o n as w e l l as a b ooming t o u r i s t i n d u s t r y . Thus t h o s e i n d u s t r i e s i n v o l v e d i n t h e p r o d u c t i o n o f f o r e s t p r o d u c t s , i n t e r m e d i a t e goods s u p p l y , and c o n s u m p t a t i v e goods s u p p l y c r e a t e t h e f u n d a m e n t a l demand f o r t h e t r a n s p o r t a t i o n s e r v i c e i n d u s t r y . H i s t o r i c a l l y t h e f o r e s t i n d u s t r y has b e e n r a i l o r i e n t e d w i t h r e s p e c t t o o u t b o u n d f o r e s t p r o d u c t movements and i n b o u n d i n t e r m e d i a t e r e q u i r e m e n t s , s u c h as c h e m i c a l s . The emergence o f t h e i s l a n d as a s i g n i f i c a n t r e g i o n a l m a r k e t has c r e a t e d a s t r o n g d e -mand f o r t h e t r a n s p o r t a t i o n o f consumer goods and g e n e r a l m e rchan-d i s e . The t r a n s p o r t a t i o n o f t h e s e p r o d u c t s has b e e n d o m i n a t e d by - 7 9 -highway c a r r i e r s w h i c h c a n p r o v i d e a f a s t e r s e r v i c e , and f l e x i -b i l i t y o f o r i g i n and d e s t i n a t i o n p o i n t s . Hence t h e r e s u l t a n t o r i e n t a t i o n o f i n b o u n d consumer goods t o t r u c k i n g and o u t b o u n d f o r e s t p r o d u c t s t o r a i l . T h e r e h a v e b e e n two d e v e l o p m e n t s i n r e c e n t y e a r s w h i c h have h a d an i n c r e a s i n g i m p o r t a n c e t o c o m m e r c i a l t r a f f i c t o t h e i s l a n d . The f i r s t i s a g e n e r a l t r e n d away f r o m r a i l c a r t o highway t r a n s p o r t . The tremendous f l e x i b i l i t y and a c c e s s i b i l i t y o f t h e highway mode i s t h e b a s i s f o r t h i s t r e n d . ' T r u c k i n g f i r m s c a n p r o -v i d e one day d o o r - t o - d o o r s e r v i c e t o most i s l a n d c o m m u n i t i e s where-as t h e r a i l i s s u b j e c t t o i n f l e x i b l e r o u t e s and a t b e s t , 4 day s e r v i c e t o t h e i s l a n d . The f o r e s t i n d u s t r y now h a u l s most o f i t s i n t e r m e d i a t e goods t o t h e I s l a n d v i a t r u c k r a t h e r t h a n r a i l . E x h i b i t 4.1 r e v e a l e d t h e d o w n t r e n d i n t h e number o f r a i l c a r s move-ments t o and f r o m t h e I s l a n d by B.C.C.S.S. The s e c o n d d e v e l o p m e n t li a s b e e n t h e t r e n d o f s e v e r a l s h i p p e r s and c a r r i e r s t o t r e a t V a n c o u v e r I s l a n d as a p i c k u p and d e l i v e r y a r e a , c e n t e r e d on V a n c o u v e r . S u c h a d e v e l o p m e n t f a v o r s t h e highway mode o v e r r a i l c a r . A good example o f s u c h a d i s t r i -b u t i o n s y s t e m i s Safeway S t o r e s , w h i c h d e l i v e r t o a l l i s l a n d p o i n t s d i r e c t l y f r o m t h e c e n t r a l V a n c o u v e r w a r e h o u s e . The s o l u t i o n t o t h e t w i n b a c k h a u l p r o b l e m s w o u l d seem t o be a move t o a s i n g l e mode o f t r a n s p o r t . I f s u c h an a l t e r n a t i v e c o u l d be d e v e l o p e d , t h e p o t e n t i a l f o r r e d u c i n g o v e r a l l c o s t s and -80-i n e f f i c i e n c y a r e c o n s i d e r a b l e . B e s i d e s t h e two t r e n d s m e n t i o n e d above, t h e r e a r e s e v e r a l f a c t o r s w h i c h w i l l i n c r e a s e p r e s s u r e t o move t o w a r d a more e f f i c i e n t s o l u t i o n . As e q u i p m e n t and o p e r a t i n g c o s t s c o n t i n u e t o i n c r e a s e , so w i l l t h e c o s t s o f i n e f f i c i e n c y (empty b a c k h a u l s ) , f o r c i n g s h i p p e r s and c a r r i e r s t o r e c o n c i l e t h e s i t u a t i o n . The I s l a n d p o p u l a t i o n i s e x p e c t e d t o c o n t i n u e g r o w i n g a t above t h e n a t i o n a l a v e r a g e , a i d e d by i n - m i g r a t i o n as w e l l as n a t u r a l g r o w t h . T h i s w i l l i n c r e a s e t h e demand f o r consumer goods t r a n s p o r t , t h e r e b y , i n c r e a s i n g t h e empty t r a i l e r b a c k h a u l p r o b l e m . The f u t u r e o f t h e n o r t h I s l a n d w i l l be c e n t e r e d a r o u n d f o r e s t r y and t h e t o u r i s t i n d u s t r y . The t r a n s p o r t a t i o n r e q u i r e m e n t s o f t h i s a r e a w i l l be o r i e n t e d t o t h e highway. T h u s , a l l i n d i c a t i o n s p o i n t t o w a r d t h e e x p a n d i n g m o t o r c a r r i e r i n d u s t r y , and d e c l i n i n g r a i l t r a f f i c . The e x p e r i e n c e o f Domans T r a n s p o r t s u g g e s t s t h e u s e o f d r o p t r a i l e r s as a f e a s i b l e means o f m o v i n g f o r e s t p r o d u c t s f r o m t h e I s l a n d - t o t h e m a i n l a n d . As a p r i v a t e c a r r i e r , Domans t r a n s p o r t e d lumber p r o d u c t s f r o m t h e i r m i l l a t Duncan t o t h e m a i n -l a n d f o r t r a n s h i p m e n t . When t h e y became a common c a r r i e r a p p r o x i -m a t e l y 15 y e a r s ago, c o n s t r u c t i o n m a t e r i a l s were c a r r i e d t o t h e I s l a n d on r e t u r n t r i p s . T h i s s i t u a t i o n i s u n i q u e i n t h a t Doman's e a s t b o u n d and w e s t b o u n d movements a r e a b o u t e q u a l . I t s e x i s t a n c e and g r o w t h f o r s e v e r a l y e a r s s u g g e s t s t r u c k i n g as a f e a s i b l e means o f m o v i n g lumber p r o d u c t s f r o m t h e i s l a n d . - 8 1 -I f t h e movement o f f o r e s t p r o d u c t s by t r u c k c a n be shown t o be f e a s i b l e on a l a r g e s c a l e , t h e n t h e r e q u i r e m e n t s f o r r a i l t r a n s p o r t t o t h e i s l a n d may be e l i m i n a t e d . I f s u c h a s t u d y were u n d e r t a k e n , t h e t o t a l c o s t s o f b o t h t h e i n b o u n d p r o d u c t s and o u t -bound lumber must be c o n s i d e r e d r a t h e r t h a n t h e i r i n d i v i d u a l d i r e c t i o n a l movements. By e l i m i n a t i n g t h e empty b a c k h a u l , l o w e r t o t a l c o s t s may be e a s i l y w i t h i n r e a c h . An a d d e d b e n e f i t t o s u c h a s y s t e m w o u l d be h i g h e r s e r v i c e l e v e l s , e s p e c i a l l y g i v e n t h e I s l a n d ' s o r i e n t a t i o n t o t h e highway. 4.2 T r a f f i c P r o j e c t i o n s T h i s c h a p t e r has a n a l y s e d t h e c h a r a c t e r i s t i c s o f d r o p t r a i l e r t r a f f i c , i n c l u d i n g c u r r e n t v o l u m e s , p e a k i n g and t r a f f i c p a t t e r n s . W i t h t h i s as a b a s i s , i t i s an o p p o r t u n e t i m e t o d i s -c u s s t h e f a c t o r s and c o n s i d e r a t i o n s w h i c h w i l l a f f e c t f u t u r e t r a f f i c v o l u m e s . The n e c e s s i t y o f a p r o j e c t i o n becomes a p p a r e n t when a n a l y z i n g t h e c a p a c i t y o f t h e p r e s e n t s y s t e m . I t i s n e c e s s a r y f o r d e t e r m i n i n g f u t u r e n e e d s , and v i t a l when p l a n n i n g f o r new o r e x p a n d e d f a c i l i t i e s . S i n c e t h e ma i n p r o d u c t s c a r r i e d by d r o p t r a i l e r a r e c o n -sumer p r o d u c t s and g e n e r a l m e r c h a n d i s e , t h e demand f o r s u c h t r a n s -p o r t a t i o n i n t h e f u t u r e w i l l be c l o s e l y l i n k e d t o t h e demand f o r consumer p r o d u c t s . A l t h o u g h t h i s m a r k e t i s s u b j e c t t o f l u c t u a t i o n s i n t h e g e n e r a l economy, many o f t h e c o m m o d i t i e s c a r r i e d a r e s t a p l e - 8 2 -p r o d u c t s . Thus t h e movement i n t h e f u t u r e w i l l be r e l a t i v e l y s t a b l e . I t w i l l grow as t h e p o p u l a t i o n o f t h e i s l a n d grows. I n t h e p a s t 10 y e a r s t h i s has b e e n a t an a v e r a g e a n n u a l r a t e o f 3.14 p e r c e n t , much h i g h e r t h a n t h e n a t i o n a l a v e r a g e . The o p e n i n g o f t h e new h ighway f r o m K e l s e y Bay t o t h e n o r t h e r n i s l a n d p o i n t s w i l l c r e a t e a new m a r k e t f o r c a r r i e r s as goods a r e c u r r e n t l y s h i p p e d v i a b a r g e and a i r f r e i g h t . The f l e x i b i l i t y o f t r u c k i n g s h o u l d p r o v e c o m p e t i t i v e w i t h t h e s e modes. Highway t r a n s p o r t i s e x p e c t e d t o c o n t i n u e t o make i n -r o a d s i n t o t h e . t r a d i t i o n a l r a i l c a r m a r k e t . As more and more s h i p p e r s u s e V a n c o u v e r as a t r a n s h i p m e n t c e n t r e f o r e a s t b o u n d f r e i g h t , t h e r a i l c a r s w i l l l o s e b u s i n e s s t o t r u c k e r s . S e c t i o n 4.1.5 o u t l i n e d s e v e r a l f a c t o r s w h i c h w i l l p l a c e f u r t h e r i m p o r t a n c e on t r u c k i n g t o t h e I s l a n d i n t h e f u t u r e . A r e g r e s s i o n a n a l y s i s was p e r f o r m e d on t h e volume d a t a , and a r e g r e s s i o n e q u a t i o n d e t e r m i n e d . The t r e n d l i n e was p l o t t e d a g a i n s t t h e t r a f f i c v olumes and a r e c o n t a i n e d i n E x h i b i t 4.3. The o n l y s i g n i f i c a n t v a r i a t i o n f r o m t h i s t r e n d l i n e was i n t h e y e a r 19 74 w h i c h was t h e y e a r f o l l o w i n g t h e B.C. F e r r i e s ban on d r o p t r a i l e r s . T h i s t r e n d w o u l d i n d i c a t e a a n n u a l g r o w t h o f 5036 u n i t s p e r y e a r . T h i s r e p r e s e n t s t h e b e s t e s t i m a t e o f what c a n be ex-p e c t e d i n t h e n e a r f u t u r e . The above e s t i m a t e a l s o assumes t h a t t h e B.C. F e r r i e s t r a i l e r f e r r y c a p t u r e s no B.C.C.S.S. d r o p t r a i l e r t r a f f i c . T h i s -83-a s s u m p t i o n i s r e a l i s t i c f o r t h e f o l l o w i n g r e a s o n s : (1) B.C. F e r r i e s do n o t p l a n t o s p e c i a l i z e i n t r a n s -7 p o r t i n g d r o p t r a i l e r s on t h e new f e r r y . (2) P a r k i n g f a c i l i t i e s a r e l i m i t e d f o r d r o p s a t a l l f o u r B.C. F e r r y T e r m i n a l l o c a t i o n s . (3) T h e r e a r e no p l a n s a t p r e s e n t t o p r o v i d e s p e c i a l -i z e d l o a d i n g f a c i l i t i e s . (4) B.C. F e r r i e s n e e d f o r t h e new t r a i l e r f e r r y i s t o a l l e v i a t e t h e p r o b l e m s c a u s e d by c o m m e r c i a l t r a f f i c and o v e r -h e i g h t s . (5) I t w o u l d be a r e v e r s a l i n Government p o l i c y r e -g a r d i n g c o m m e r c i a l t r a f f i c . (6) B.C. F e r r i e s may f e a r r e a c t i o n s o f B.C.C.S.S. who have been an i m p o r t a n t s u p p l e m e n t t o t h e i r c a p a c i t y . E x h i b i t 4.3 i n c l u d e s a " h i g h " and "low" e s t i m a t e o f f u t u r e t r a f f i c v o l u m e s . The h i g h e s t i m a t e p l a c e s t h e a n n u a l g r o w t h a t 15 p e r c e n t above t h a t i n d i c a t e d by t h e t r e n d p r o j e c t i o n . The low e s t i m a t e p u t t h e i n c r e a s e a t 20 p e r c e n t b e l o w t h e a n n u a l i n c r e a s e p r o j e c t e d . T h e s e two f i g u r e s a r e f o r i l l u s t r a t i v e p u r -p o s e s and t h e l o w e r i n c r e a s e w i l l be u s e d t o c h e c k t h e s e n s i t i v i t y o f t h e p r o j e c t i o n . S u c h a s t e a d y i n c r e a s e i n t r a f f i c has i m p o r t a n t i m p l i c a -t i o n s w h i c h c a n n o t be o v e r l o o k e d a t t h e p r e s e n t t i m e . I t r a i s e s t h e q u e s t i o n o f t h e a d e q u a c y o f t h e p r e s e n t s y s t e m , i n c l u d i n g t h e c a p a c i t y o f v e s s e l s and t e r m i n a l f a c i l i t i e s t o meet t h e s e p r o j e c -•7-Per.son-al i n t e r v i e w , w i t h Mr. B. B o u c h a r d , B.C. F e r r i e s . EXHIBIT 4.3 ANNUAL TRAFFIC PROJECTIONS LEGEND 1 . High E s t i m a t e L i m i t 2 . Expected Growth 3 . Low Es t i m a t e i cn I -i r 1 9 6 8 1 9 6 9 1 9 7 0 1 9 7 1 1 9 7 2 1 9 7 3 1 9 7 4 1 9 7 5 1 9 7 6 1 9 7 7 1 9 7 8 1 9 7 9 1 9 8 0 1 9 8 1 1 9 8 2 1 9 8 3 1 9 8 4 1 9 8 5 1 9 8 6 YEAR - 8 5 -t i o n s . Thus t h e n e x t c h a p t e r c o n c e r n s i t s e l f w i t h an a n a l y s i s o f B.C.C.S.S.'s f a c i l i t i e s . C h a p t e r 5 Drop T r a i l e r F a c i l i t i e s - 8 7 -C h a p t e r 5 p r e s e n t s an a n a l y s i s o f t h e B.C.C.S.S.'s f a c i l i t i e s f o r t h e movement o f d r o p t r a i l e r s . The m a i n a r e a o f c o n c e r n i s w i t h t h e p r e s e n t c a p a c i t y o f t h e s y s t e m , and i t s ade-q u a c y f o r h a n d l i n g f u t u r e volumes o f t r a f f i c . The l o c a t i o n o f t h e p r e s e n t f a c i l i t i e s i s a n a l y s e d w i t h p a r t i c u l a r e m p h a s i s on t h o s e f a c t o r s w h i c h w i l l l i m i t f u t u r e e x p a n s i o n , and n e c e s s i t a t e a r e l o -c a t i o n o f f a c i l i t i e s . 5.1 P r e s e n t F a c i l i t i e s 5.1.1 T e r m i n a l A r e a and V e s s e l s The B.C.C.S.S. t e r m i n a l i s l o c a t e d i n V a n c o u v e r ' s i n n e r h a r b o u r a t t h e f o o t o f B u r r a r d S t r e e t . I t o c c u p i e s an a r e a o f a p p r o x i m a t e l y 9 a c r e s . However t h i s a r e a t e n d s t o be l o n g and s p r e a d o u t , r o u g h l y f o l l o w i n g t h e s h o r e l i n e s , and s t r e t c h i n g f r o m M a i n S t r e e t t o C a r d e r o S t r e e t . As r e f e r r e d t o i n s e c t i o n 3.1.1 B.C.C.S.S. p r o v i d e t h e i r s e r v i c e f r o m two s h i p b e r t h s , known as P i e r s A - l and A-3. As w e l l , t h e a d m i n i s t r a t i v e o f f i c e s o f B.C.C.S.S. a r e l o c a t e d on P i e r * B-C, w h i c h i s owned by t h e N a t i o n a l H a r b o u r s B o a r d , and l e a s e d t o B.C.C.S.S. A s m a l l o f f i c e n e a r t h e two p i e r s s e r v e s as t h e t r a f f i c o f f i c e f o r t h e T r a f f i c S u p e r v i s o r s f o r t h e day t o day o p e r a t i o n s . A map d e t a i l i n g t h e l a y o u t o f t h e l o c a t i o n i s c o n t a i n e d i n E x h i b i t 5.1. - 8 8 -The f i v e s h i p s u s e d by B.C.C.S.S. a r e d e s c r i b e d i n T a b l e 3.1. The c a p a c i t y o f t h i s f l e e t c a n b e s t be d e s c r i b e d i n terms o f " l i f t - o f f c a p a c i t y " . F o r c o m p a r a t i v e p u r p o s e s t h e l i f t - o f f c a p a c i t y i s computed i n t e r m s o f one v e h i c l e t y p e . . The c o n v e r s i o n f a c t o r , o b t a i n e d f r o m B.C. F e r r i e s i s : 1 1 T r a c t o r T r a i l e r = 3 . 0 a u t o m o b i l e s U s i n g t h i s f a c t o r , t h e l i f t - o f f c a p a c i t y was e s t i m a t e d f o r B.C.C.S.S., and f o r c o m p a r a t i v e p u r p o s e s , B.C. F e r r i e s . The l i f t - o f f c a p a c i t y was d e t e r m i n e d u s i n g 16 s a i l i n g s p e r day f o r e a c h B.C. F e r r y t e r m i n a l , and 9 s a i l i n g s p e r day (summer s c h e d u l e ) ; f o r B.C.C.S.S. P e r s o n a l I n t e r v i e w w i t h Mr. B. B o u c h a r d , B.C. F e r r i e s . TABLE 5.1 SYSTEM CAPACITIES B.C.C.S.S.: S c h e d u l e d D a i l y L i f t o f f Cap. (1974) A u t o s / D a y % S w a r t z Bay - V a n c o u v e r 888 Nanaimo - V a n c o u v e r 1332 Sub T o t a l 2220 15.6% B.C. FERRIES: Route 1 6500 Route 2 5500 Sub T o t a l 12000 84.4% TOTAL 14220 100.0% S o u r c e : B.C.C.S.S. e s t i m a t e s o b t a i n e d f r o m B.C.C.S.S. O p e r a t i o n s R e p o r t . B.C. F e r r i e s c a p a c i t y e s t i m a t e d f r o m B.C. F e r r i e s 1974'.Fact S h e e t and c o n v e r s a t i o n s w i t h Mr. B. B o u c h a r d . The dominance o f B.C. F e r r i e s i n terms o f l i f t - o f f c a p -a c i t y i s shown i n T a b l e 5.1. B.C.C.S.S.'s maximum d a i l y l i f t - o f f c a p a c i t y i n terms o f d r o p t r a i l e r s i s 6 30 u n i t s . T h i s f i g u r e i n c l u d e s t h e e x t r a m idday s a i l i n g s e t up d u r i n g t h e summer months w h i c h r u n s between Nanaimo and V a n c o u v e r and c a r r i e s m a i n l y t o u r -i s t t r a f f i c . When t h i s and t h e n o r m a l r a i l c a r t r a f f i c a r e a c c o u n t -e d f o r , t h e e f f e c t i v e d r o p t r a i l e r c a p a c i t y i s 472 u n i t s p e r day. Thus i n 1974 d r o p t r a i l e r s moved a t a p p r o x i m a t e l y 75 p e r c e n t o f c a p a c i t y . The c a p a c i t y i n e x c e s s o f r a i l c a r s and d r o p s i s a s s i g n e d t o c a r s . - 9 1 -5.1.2 C a p a c i t y o f F a c i l i t i e s The two most i m p o r t a n t f a c t o r s w h i c h w i l l l i m i t t h e s y s -tem's c a p a c i t y i n t h e f u t u r e a r e v e s s e l c a p a c i t y and p a r k i n g s p a c e . Of t h e two, v e s s e l c a p a c i t y w i l l h a v e t h e most i m m e d i a t e 2 l i m i t i n g i n f l u e n c e . W i t h t h e r e g u l a r s c h e d u l e , t h e maximum number o f d r o p t r a i l e r s w h i c h c o u l d be c a r r i e d i s 472 p e r day. On t h e b a s i s o f t h e t r a f f i c p r o j e c t i o n s c o n t a i n e d i n s e c t i o n 4.2 t h i s c a p a c i t y w i l l be r e a c h e d i n 1981, when t h e y e a r l y volume s h o u l d r e a c h a p p r o x i m a t e l y 115,000 t r a i l e r s . The l i f t - o f f c a p a c i t y c o u l d be i n c r e a s e d by an a d d i t i o n a l s a i l i n g o f t h e " T r a i l e r P r i n c e s s " , and t h e " C a r r i e r P r i n c e s s " , o p e r a t i n g on h e r summer s c h e d u l e y e a r r o u n d . T h i s w o u l d s a t i s f y p r o j e c t e d volumes up t o and i n -c l u d i n g 1981 . The r e m a i n i n g B.C.C.S.S.-owned v e s s e l , "The P r i n c e s s o f V a n c o u v e r " i s c u r r e n t l y o p e r a t i n g a t c a p a c i t y w i t h t h r e e r o u n d t r i p s o f a p p r o x i m a t e l y 7 and 1/2 h o u r s e a c h . B.C.C.S.S. e x p e r -i e n c e much l o n g e r t u r n a r o u n d t i m e s w i t h d r o p t r a i l e r s t h a n does B.C. F e r r i e s w i t h a u t o s and l i v e t r u c k s . On a v e r a g e , B.C. F e r r i e s l o a d a c a r e v e r y 3 s e c o n d s w h i l e B.C.C.S.S. u s u a l l y t a k e s o v e r one m i n u t e p e r t r a i l e r . 2 P e r s o n a l I n t e r v i e w w i t h J . Y a t e s , Manager B.C.C.S.S. and J . F i n n y , T r a f f i c S u p e r v i s o r , B.C.C.S.S. - 9 2 -The s i z e and p h y s i c a l l a y o u t o f B.C.C.S.S.'s p a r k i n g f a c i l i t i e s i s a c o n s t a n t s o u r c e o f o p e r a t i o n a l p r o b l e m s . The maximum number o f t r a i l e r s t h a t c a n be p a r k e d i n an o r d e r l y f a s h i o n 3 i s a b o u t 130. S l i g h t l y more c a n be p a r k e d , b u t t h i s l e a d s t o o v e r c r o w d i n g and c o n g e s t i o n . As a r e s u l t , B.C.C.S.S. must be i n c o n s t a n t c o m m u n i c a t i o n w i t h c a r r i e r s r e g a r d i n g r e m o v a l o f i n c o m i n g t r a i l e r s . The c o n g e s t i o n r e s u l t s f r o m t h e p o p u l a r i t y o f t h e o v e r -n i g h t s a i l i n g s , and i s t h u s a p e a k i n g p r o b l e m . I f e x t r a s a i l i n g s were added d u r i n g t h e day, t h e n t h e p a r k i n g l o t s c o u l d h a n d l e t h e a d d i t i o n a l t r a f f i c . However, as t h e r e i s a d i s t i n c t p r e f e r e n c e f o r n i g h t s a i l i n g s , t h i s p o s s i b i l i t y seems remot e , u n l e s s t h e r e a r e f i n a n c i a l i n d u c e m e n t s t o s e n d t r a i l e r s d u r i n g t h e day. The p i e r s u s e d f o r l o a d i n g and u n l o a d i n g t h e f e r r i e s a r e i n t h e same p o s i t i o n . They a r e o p e r a t i n g c l o s e t o c a p a c i t y d u r i n g t h e e v e n i n g h o u r s , b u t once a g a i n , c o u l d be b e t t e r u t i l i z e d d u r i n g t h e day. The f i x e d f a c i l i t i e s c a n n o t h a n d l e more s a i l i n g s d u r i n g t h e e v e n i n g h o u r s , t h u s t h e y a r e c l o s e l y t i e d t o t h e v e s s e l s w i t h r e s p e c t t o r e a c h i n g f u l l c a p a c i t y . The a b i l i t y t o i n c r e a s e o p e r a t i n g e f f i c i e n c y by e n l a r g i n g t h e p a r k i n g l o t i s re m o t e . I n t h e f i r s t p l a c e , t h e t e r m i n a l i s 3 Mr. J . F i n n e y , T r a f f i c S u p e r v i s o r , B.C.C.S.S. -93-i n a h i g h l y d e v e l o p e d a r e a . T h e r e i s no. v a c a n t l a n d i n t h e immed-i a t e a r e a i n w h i c h t o expand. The r a i l w a y t r a c k s and t h e downtown c o r e p r e v e n t e x p a n s i o n s o u t h w a r d . L a n d e a s t and w e s t o f t h e C.P.R. y a r d s i s p r e s e n t l y o c c u p i e d by o t h e r w a t e r f r o n t u s e r s . 5.2 L o c a t i o n A n a l y s i s 5.2.1 N e c e s s i t y o f P r e s e n t L o c a t i o n B e s i d e s t h e p h y s i c a l l i m i t a t i o n s o f t h e p r e s e n t f a c i l i t i e s , t h e r e a r e o t h e r f a c t o r s i n v o l v e d w h i c h p r e s e n t p r o b l e m s t o t h e p r e s e n t t e r m i n a l . M o s t o f t h e s e a r i s e as a r e s u l t o f t h e l o c a t i o n o f t h e f a c i l i t i e s r e l a t i v e t o o t h e r downtown d e v e l o p m e n t . One u n d e r l y i n g q u e s t i o n i n t h i s r e g a r d i s w h e t h e r o r n o t t h e c u r r e n t l o c a t i o n i s n e c e s s a r y f o r p r e s e n t and f u t u r e o p e r a t i o n s . H i s t o r i c a l l y , d u r i n g t h e e a r l y d e v e l o p m e n t o f Canada, t h e r a i l w a y was t h e p r i m e (and o f t e n t h e o n l y ) means o f t r a n s p o r t a t i o n f o r b o t h p a s s e n g e r s and f r e i g h t . Thus a c e n t r a l l o c a t i o n on t h e w a t e r f r o n t was v i t a l . T o d ay, C.P.'s m a i n y a r d s a r e l o c a t e d i n C o q u i t l a m , and o n l y t h o s e c a r s bound f o r t h e i s l a n d use t h e down-town y a r d . The t r u c k i n g o p e r a t i o n s do n o t r e q u i r e t h e c e n t r a l l o c a t i o n , and i n many c a s e s f i n d i t i n c o n v e n i e n t . Thus most p a r -t i e s w o u l d a g r e e t h a t p r e s e n t o p e r a t i o n s c o u l d be c a r r i e d on w i t h -o u t any l o s s i n e f f i c i e n c y a t an a l t e r n a t e l o c a t i o n . T h i s f a c t o r c o u p l e d w i t h t h e u n a t t r a c t i v e n e s s o f t h e r a i l l i n e s , p a r k e d t r a i l e r s and w h a r f s s e t a g a i n s t downtown V a n c o u v e r h ave l e a d s e v e r a l -94-p a r t i e s t o b e l i e v e t h e f a c i l i t y s h o u l d be r e l o c a t e d . 5.2.2 P o l i t i c a l P r e s s u r e P e r h a p s t h e most i m p o r t a n t i s s u e w i t h t h e p r e s e n t o p e r a -t i o n s , i s t h e i r i n c o n s i s t e n c y w i t h f u t u r e p l a n s f o r t h e a r e a . L i k e most m a j o r N o r t h A m e r i c a n c i t i e s u r b a n r e n e w a l and r e d e v e l o p -ment have b e e n t a k i n g p l a c e . The w a t e r f r o n t a r e a between M a i n S t r e e t and S t a n l e y P a r k h a s b e e n t h e s u b j e c t o f an e x t e n s i v e s t u d y by t h e C i t y P l a n n i n g D e p a r t m e n t . O v e r a p e r i o d o f 3 y e a r s t h e s t u d y g r o u p has p r e s e n t e d f o u r r e p o r t s known as t h e " W a t e r f r o n t 4 P l a n n i n g S t u d y " . The s t u d y c a l l s f o r t h e u r b a n i z a t i o n and r e s i -d e n t i a l u s e s combined w i t h " p u b l i c o p en s p a c e s " . The p r i m e a s -p i r a t i o n i s t o l i n k t h e w a t e r f r o n t p h y s i c a l l y and s o c i a l l y w i t h t h e p e r m a n e n t l y d e v e l o p e d downtown p e n n i s u l a . The new d e v e l o p m e n t w o u l d have t o be c o m p a t a b l e w i t h e x i s t i n g u s e r s s u c h as S t a n l e y P a r k and Gastown. L i s t e d as p o s s i b l e means o f a c h i e v i n g s u c h g o a l s w o u l d be t h e r e l o c a t i o n o f a l l o r p a r t o f t h e r a i l w a y w e s t o f M a i n S t r e e t , and t h e c u r t a i l m e n t o f h e a v y t r u c k movements t o and f r o m t h e a r e a . The C i t y has r e c e n t l y a c c e p t e d i n p r i n c i p l e t h e p l a n s o u t l i n e d i n t h e s t u d y . I n l i g h t o f t h i s , f u r t h e r d e v e l o p m e n t and 4 Mann, R.C. p r o j e c t Manager, W a t e r f r o n t P l a n n i n g S t u d y . A j o i n t s t u d y s p o n s o r e d by t h e C i t y o f V a n c o u v e r and t h e M i n i s t r y o f S t a t e f o r U r b a n A f f a i r s , V a n c o u v e r , 19 74. -95-e x p a n s i o n i n t h e a r e a w o u l d n o t r e c e i v e t h e C i t y C o u n c i l ' s a p p r o -v a l . E v e n i f f u r t h e r e x p a n s i o n by C P . was p h y s i c a l l y p o s s i b l e , p e r m i s s i o n t o do s o w o u l d be w i t h h e l d by t h e c i t y > t h e r e b y e f f e c t i v e l y p r e v e n t i n g any new d e v e l o p m e n t . The c o n v e n i e n c e and e x p o s u r e o f t h e a r e a a r e e x t r e m e l y f a v o r a b l e f o r t h e r e c r e a t i o n a l and r e s i d e n t i a l p r o p o s a l s c o n t a i n e d i n t h e w a t e r f r o n t s t u d y . The l a n d i s a l o n g t h e w a t e r f r o n t a d j a -c e n t t o t h e l a r g e s t c o m m e r c i a l , f i n a n c i a l and b u s i n e s s d i s t r i c t i n w e s t e r n Canada, and c l o s e t o s e v e r a l h i g h r i s e and m u l t i - u n i t d w e l l i n g s . The c e n t r a l downtown l o c a t i o n makes i t c o n v e n i e n t t o a l a r g e number o f p e r s o n s . I n 1972 t h e r e were 46,000 p e r s o n s l i v i n g i n t h e downtown p e n n i s u l a ( a r e a 4 s q u a r e m i l e s ) and t h i s f i g u r e i s e x p e c t e d t o grow t o 64,500 by t h e y e a r 1985. The o r i e n t a t i o n o f t h e l a n d i s e x c e l l e n t . I t i s i n a s h e l t e r e d h a r -b o u r , a d j a c e n t t o S t a n l e y P a r k , w i t h an e x c e l l e n t v i e w o f t h e n o r t h s h o r e m o u n t a i n s . The w a t e r f r o n t p l a n n i n g c o m m i t t e e s u g g e s t s t h e b e s t u s e s o f t h e a r e a w o u l d be t h o s e w h i c h s t r e s s t h e p o t e n t i a l f o r s o c i a l , c o m m e r c i a l , and r e c r e a t i o n a l a c t i v i t i e s w h i l e p r e s e r v -i n g t h e a e s t h e t i c q u a l i t i e s o f t h e a r e a . B e s i d e s t h e c i t y ' s p l a n s , t h e r e a r e p r o b l e m s c a u s e d by t h e c e n t r a l l o c a t i o n o f B.C.C.S.S.'s f a c i l i t i e s . P e r h a p s t h e most ^ P e r s o n a l I n t e r v i e w w i t h Mr. T. Nonay, C i t y P l a n n i n g D e p a r t m e n t . o p . c i t . , W a t e r f r o n t P l a n n i n g S t u d y - r o u g h w o r k i n g p a p e r s . The same s t u d y e s t i m a t e s t h a t by 1985, 95,000 p e r s o n s w i l l b e w o r k i n g i n t h e same a r e a . -96-i m p o r t a n t a r e t h o s e c o n c e r n e d w i t h t h e a c c e s s t o and f r o m t h e f a c i l i t i e s . F i r s t , t h e r e a r e o n l y two e n t r a n c e s t o t h e t e r m i n a l f a c i l i t i e s . B u r r a r d S t r e e t i s t h e most i m p o r t a n t , and t h e o n l y e n t r a n c e f a c i n g s o u t h . The s e c o n d e n t r a n c e i s on t h e e a s t end on a p r i v a t e r o a d n o r t h o f A l e x a n d e r S t r e e t . T h i s r o a d p a s s e s u n d e r t h e end o f P i e r B-C and r e q u i r e s t i g h t m a n o e u v r i n g . A c c e s s t o t h e s e e n t r a n c e s i s u s u a l l y made a l o n g B u r r a r d S t r e e t v i a Broadway and Oak, o r a l o n g H a s t i n g s , M a i n o r K i n g s w a y . I n a l l c a s e s , a c c e s s t o t h e f a c i l i t y i n v o l v e s a t r i p t h r o u g h down-town V a n c o u v e r . C u r r e n t l y f o r c a r r i e r s l i k e J o h n s t o n T e r m i n a l s and C P . T r a n s p o r t , t h e d i s t a n c e i s n o t g r e a t b u t i s t i m e c o n -suming. C P . T r a n s p o r t however, a r e i n t h e p r o c e s s o f r e l o c a t i n g t h e i r t e r m i n a l t o C o q u i t l a m . F o r o t h e r c a r r i e r s l i k e Domans and Safeway who a r e l o c a t e d o u t s i d e V a n c o u v e r c i t y l i m i t s , t h e t r i p i s b o t h l e n g t h y and t i m e c o n s u m i n g . The p r e s e n c e o f t h e s e l a r g e t r u c k s on c i t y s t r e e t s i s a c o n s t a n t s o u r c e o f c o m p l a i n t s f r o m b o t h r e s i d e n t s and m o t o r i s t s . T h e s e t r u c k s a r e g e n e r a l l y n o i s i e r , s l o w e r and c o n t r i b u t e d i s p r o -p o r t i o n a l l y t o t r a f f i c a nd e n v i r o n m e n t a l p r o b l e m s . 5.2.4 R e l o c a t i o n Q u e s t i o n The o p e r a t i o n a l p r o b l e m s o f c o n g e s t i o n , a c c e s s and l i m i t e d - 9 7 -room f o r e x p a n s i o n , as w e l l as t h e p o l i t i c a l p r e s s u r e s i n v o l v e d h ave r a i s e d t h e q u e s t i o n o f r e l o c a t i o n . T h i s i s a v e r y complex p r o b l e m due t o t h e number o f p a r t i e s i n v o l v e d , s u c h as t h e N a t i o n a l H a r b o u r s B o a r d , t h e C i t y o f V a n c o u v e r , M a r a t h o n R e a l t y > C P . R a i l and B.C.C.S.S. As w e l l , a d e c i s i o n t o r e l o c a t e w o u l d have s e v e r e e f f e c t s on t h e t r u c k i n g c o m p a n i e s , e s p e c i a l l y t h o s e l i k e J o h n s t o n T e r m i n a l s and C a p i t a l F r e i g h t w a y s whose p o o l i n g t e r m i n a l s a r e l o c a t e d i n downtown V a n c o u v e r , f a i r l y c l o s e t o t h e f e r r y t e r m i n a l . The r e l o c a t i o n i s s u e w i l l l i k e l y i n v o l v e c o n c e s s i o n s by t h e g o v e r n m e n t a g e n c i e s , s i n c e C P . i s s u c h a l a r g e l a n d h o l d e r i n t h e a r e a . As a r e s u l t o f t h e i n t r i c a c i e s i n v o l v e d , and t h e f a c t t h a t no c o n c r e t e d e c i s i o n s have y e t b e e n made, a l l i n t e r e s t e d p a r t i e s as w e l l as B.C.C.S.S. a r e v e r y r e l u c t a n t t o d i s c u s s t h e m a t t e r . 5.2.5 A l t e r n a t i v e s F a c e d w i t h t h e p r o s p e c t o f r e l o c a t i o n , C P . w i l l have s e v e r a l a l t e r n a t i v e s t o c h o o s e f r o m . To d a t e t h e y h a v e c o m m i s s i o n -e d a s t u d y t o a s s e s s t h e o p i n i o n s o f t h e m a j o r u s e r s w i t h r e s p e c t t o l o c a t i o n . The a l t e r n a t i v e s r a n g e f r o m a c o m p l e t e r e l o c a t i o n o f a l l f a c i l i t i e s , t o r e m a i n i n g where t h e y a r e . Any d e c i s i o n t o r e l o c a t e -98-would have a great impact on the users of the f a c i l i t i e s , expec-i a l l y those l o c a t e d near the f a c i l i t y i n the downtown area. An examination of a l l the p o s s i b l e a l t e r n a t i v e s i s beyond the scope of t h i s t h e s i s . Rather the t h e s i s w i l l analyse one p a r t i c u l a r a l t e r n a t i v e , which i n t h i s case i s an immediate p a r t i a l r e l o c a t i o n . Under t h i s scheme, which C P . has considered, a p o r t i o n of the drop t r a i l e r t r a f f i c would be d i v e r t e d away from downtown to a l e s s congested area. The area which has been considered, i s lo c a t e d on the North Arm of the Fraser R i v e r , c l o s e to the south 7 s i d e of the Knight S t r e e t Bridge. This l o c a t i o n has ample space a v a i l a b l e , i s adjacent to the r i v e r , has convenient s t r e e t access, and i s l o c a t e d i n an i n d u s t r i a l park. This area of north Richmond i s r a p i d l y becoming the l a r g e s t warehousing d i s t r i c t i n Greater Vancouver, .a r e s u l t of the co n t i n u i n g trend of l o c a t i n g away from downtown Vancouver. The r a t i o n a l e behind a p a r t i a l r e l o c a t i o n can be found i n the concept that only those u n i t s o r i g i n a t i n g from the downtown area, North Vancouver, P o r t Moody and surrounding areas would use the present f a c i l i t i e s . T r a f f i c o r i g i n a t i n g i n New Westminister, Richmond, D e l t a , Surrey and other o u t l y i n g areas would use the new f a c i l i t i e s . 7 Personal Interview w i t h Mr. J . Yates and Mr. A t k i n , B.C.C.S.S. j -99-The d e c i s i o n t o r e l o c a t e o n l y p a r t o f t h e f a c i l i t i e s w o u l d e n a b l e C P . t o c o n t i n u e t o grow, as w e l l as r e t a i n t h e i r f a c i l i t i e s i n t h e p r e s e n t l o c a t i o n , p o s s i b l y f o r o t h e r u s e s i n t h e f u t u r e . I n any c a s e i t w o u l d a l l o w C P . t o p r o l o n g h a v i n g t o make a f i n a l d e c i s i o n f o r some t i m e y e t . The move w o u l d s o l v e C.P.'s i m m e d i a t e c o n g e s t i o n p r o b l e m s . As w e l l , t h e r e i s ample l a n d a v a i l a b l e t o accomodate f u r t h e r e x p a n s i o n a t t h e new l o c a t i o n . On a w i d e r s c a l e , i t w o u l d p r o v i d e b e n e f i t s t o o t h e r p a r -t i e s s u c h as t h e c i t y > m a j o r u s e r s , and t h e p u b l i c . - I n o r d e r t o e v a l u a t e s u c h a p r o j e c t , a B e n e f i t - C o s t A n a l y s i s i s emplo y e d . C h a p t e r 6 B e n e f i t C o s t A n a l y s i s o f R e l o c a t i o n -101-T h i s c h a p t e r p r e s e n t s a b e n e f i t - c o s t a n a l y s i s o f a p a r t i a l r e l o c a t i o n o f B.C.C.S.S.'s f a c i l i t i e s . The f i r s t s e c t i o n o f t h e c h a p t e r d e a l s w i t h t h e u s e f u l n e s s o f b e n e f i t - c o s t a n a l y s i s as a t o o l i n d e c i s i o n m a k i n g . The n e x t two s e c t i o n s d e a l w i t h t h e c o s t s and b e n e f i t s o f s u c h an a l t e r n a t i v e . F i n a l l y t h e r e s u l t s o f t h e a n a l y s i s a r e p r e s e n t e d i n E x h i b i t 6.2 and d i s c u s s e d i n t h e c o n c l u -s i o n . 6.1 B e n e f i t C o s t A n a l y s i s 6.1.1 U s e f u l n e s s o f B e n e f i t C o s t A n a l y s i s B e n e f i t - C o s t A n a l y s i s has b e e n c h o s e n as an a p p r o p r i a t e means o f e v a l u a t i n g t h e p r o p o s e d p r o j e c t . By t h e b a s i c d e f i n i t a -t i o n o f a n a l y s i s one must f o c u s on q u e s t i o n s w h i c h go b e y o n d a d e s c r i p t i o n o f a s i t u a t i o n t o u n d e r s t a n d t h e " c a u s a l i t y and i n t e r -a c t i o n o f f o r c e s and t o draw c o n c l u s i o n s o r i m p l i c a t i o n s f r o m them" B e n e f i t - C o s t A n a l y s i s f i n d s i t s i m p o r t a n c e i n p r o v i d i n g a framework i n w h i c h a number o f a l t e r n a t i v e s c a n be e v a l u a t e d . I t i s e x t r e m e l y u s e f u l f o r s e t t i n g o u t a l l t h o s e f a c t o r s w h i c h w i l l be t a k e n i n t o a c c o u n t i n making a d e c i s i o n o r a c h o i c e . I t f o r c e s a d e t a i l e d s t u d y o f e a c h s i t u a t i o n . S i n c e t h e r e w i l l be a number o f a l t e r n a t i v e s i n t h i s c a s e , u n d e r s t a n d i n g t h e c o n s e q u e n c e s o f a l t e r n a t i v e a c t i o n s i n "*"Waters,. W.G. , E c o n o m i c s , A n a l y s i s , and, t h e E v a l u a t i o n o f ' - ' ' P o l i c y A l t e r n a t i v e s " , ' u n p u b l i s h e d p a p e r . -102-o r d e r t o make r a t i o n a l d e c i s i o n s i s n e c e s s a r y . Thus b e n e f i t - c o s t a n a l y s i s c a n be an i n d e s p e n s i b l e t o o l i n d e c i s i o n m a k i n g . 6.1.2 C o s t s As t h e p r o p o s e d p r o j e c t w o u l d n o t i n v o l v e a c o m p l e t e r e -l o c a t i o n , n o t a l l t h e f u n c t i o n s w o u l d be r e q u i r e d t o move. I n p a r t i c u l a r t h e o f f i c e and a d m i n i s t r a t i v e f u n c t i o n s w o u l d r e m a i n a t t h e i r p r e s e n t l o c a t i o n . T h i s n o t o n l y a v o i d s t h e c o s t o f an ex-p e n s i v e c o n s t r u c t i o n on t h e new s i t e , b u t p r o v i d e s t h e company w i t h g r e a t e r m o b i l i t y s h o u l d t h e y d e c i d e t o move t o an a l t e r n a t e s i t e f o r c o m p l e t e r e l o c a t i o n a t a l a t e r d a t e . The o n l y b u i l d i n g r e -q u i r e d w o u l d be a s m a l l non-permanent o f f i c e f o r t h e t r a f f i c s u p e r -v i s o r . The l a n d a c q u i s i t i o n w o u l d r e p r e s e n t one o f t h e m a j o r c o s t i t e m s . The amount o f l a n d r e q u i r e d , w i t h p o t e n t i a l f o r ex-p a n s i o n w o u l d be a p p r o x i m a t e l y 15 a c r e s . The p a r k i n g o f e a c h t r a i l e r r e q u i r e s an a r e a o f 45 f e e t by 12 f e e t . F o r e f f i c i e n t h a n d l i n g , e a c h row o f t r a i l e r s s h o u l d be s e p a r a t e d by a 75 f o o t a i s l e . The t r a i l e r s must a l s o be s e p a r a t e d i n t o i n c o m i n g and o u t -g o i n g t r a i l e r s . Thus w i t h 12 a c r e s f o r p a r k i n g and a s s u m i n g 30 t r a i l e r s p e r row, t h e new f a c i l i t y c o u l d p a r k a p p r o x i m a t e l y 360 t r a i l e r s a t one t i m e . 2 B.C.C.S.S. p u b l i c a t i o n A R e p o r t on H a n d l i n g R o l l - O n R o l l - O f f T r a f f i c a t V a n c o u v e r . V a n c o u v e r , 19 75. -103-The s e c o n d l a r g e s t s i n g l e c o s t o f t h e new f a c i l i t y w o u l d be t h e c o n s t r u c t i o n o f t h e p i e r . An e s t i m a t e o f t h i s c o s t was 3 o b t a i n e d f r o m B.C.C.S.S. As w e l l , t h e r e w i l l l i k e l y be a c e r t a i n amount o f d r e d g i n g a r o u n d t h e p i e r r e q u i r e d . A p p r o x i m a t e l y t h r e e h o s t l e r s w o u l d be r e q u i r e d f o r t h e l o a d i n g and u n l o a d i n g o p e r a t i o n s . W i t h an e f f i c i e n t l a y o u t , t h e s e o p e r a t i o n s c a n be p e r f o r m e d w i t h a 10-15 m i n u t e t i m e s a v i n g s p e r s h i p o v e r t h e e x i s t i n g t e r m i n a l . The f o l l o w i n g f i g u r e s r e p r e s e n t t h e c o s t s f o r c o n s t r u c t i n g t h e new d r o p t r a i l e r f a c i l i t y on t h e n o r t h arm o f t h e F r a s e r R i v e r . T h e s e f i g u r e s a r e e s t i m a t e s b a s e d on c o n v e r s a t i o n s w i t h v a r i o u s p e r s o n s . The c o n s t r u c t i o n p e r i o d i s e s t i m a t e d a t e i g h t months. C a p i t a l C o s t s L a n d A c q u i s i t i o n $ 1,^200,000 P i e r C o n s t r u c t i o n 600,000 A c c e s s and P a r k i n g 200,000 T r a f f i c O f f i c e 20,000 L i g h t i n g 40,000 E q u i p m e n t 106,000 D r e d g i n g ( e s t . ) 100,000 $ 2,266,000 P e r s o n a l I n t e r v i e w w i t h Mr. A k i n , B.C.C.S.S. -104-S i n c e t h e new f a c i l i t y w o u l d be l o c a t e d i n an i n d u s t r i a l p a r k , u n r e s t r i c t e d movements o f l a r g e t r a c t o r - t r a i l e r u n i t s w o u l d be p e r m i t t e d , s o t h e r e w o u l d be no n o i s e o r c o n g e s t i o n c o s t s . 6.1.3 B e n e f i t s T h e r e a r e s e v e r a l b e n e f i t s w h i c h w o u l d r e s u l t f r o m t h e d i v e r s i o n o f a p o r t i o n o f t r a f f i c f r o m t h e downtown l o c a t i o n t o t h e new f a c i l i t y . T h e s e b e n e f i t s r a n g e f r o m p r e v e n t i n g a s a t -u r a t i o n o f c a p a c i t y and i n c r e a s e d a c c e s s i b i l i t y t o d e c r e a s i n g t r a f f i c and n o i s e i n t h e downtown a r e a . However, some d i f f i c u l -t i e s a r e e n c o u n t e r e d due i n t h e measurements o f t h e s e b e n e f i t s . S i n c e a l l b e n e f i t s a r e t o be e x p r e s s e d on t h e same s c a l e ( i . e . d o l l a r s ) , a v a l u e f o r s u c h i n t a n g i b l e i t e m s s u c h as t i m e and c o n -g e s t i o n must be computed. One o f t h e most c r i t i c a l a r e a s i n t h e a n a l y s i s i s t h e d e t e r m i n a t i o n o f f u t u r e volumes u s i n g t h e f a c i l i t i e s . The two l a r g e s t b e n e f i t s a r e t h e r e s u l t o f i n c r e a s e d c a p a c i t y o f t h e s y s -tem, and g r e a t e r a c c e s s i b i l i t y f o r d i v e r t e d t r a f f i c . B o t h o f t h e s e d e p e n d on t h e amount o f t r a f f i c t h a t w i l l be d i v e r t e d . I n -c r e a s e d c a p a c i t y i s n o t a b e n e f i t i t s e l f , r a t h e r t h e b e n e f i t i s t h e v a l u e o f a d d i t i o n a l t r a f f i c o r a d e c r e a s e i n o p e r a t i n g c o s t s t o a g i v e n t r a f f i c v olume. S e c t i o n 4.2 has p r o v i d e d a f o r e c a s t o f f u t u r e d r o p t r a i l e r t r a f f i c . S e c t i o n 5.1.2 o f t h e l a s t c h a p t e r e s t i m a t e d t h e -105-p o i n t a t w h i c h c a p a c i t y w o u l d be s a t u r a t e d w o u l d be i n 19 81 a t t h e l a t e s t . A f t e r t h a t t i m e , a l l new t r a f f i c w o u l d h ave t o u s e t h e B.C. F e r r i e s and c r o s s t h e S t r a i t as l i v e t r u c k s . T h e r e f o r e , one b e n e f i t o f t h e p r o p o s e d f a c i l i t y w o u l d be t h e a b i l i t y t o c a r r y t h o s e u n i t s w h i c h w o u l d o t h e r w i s e have t o use B.C. F e r r i e s . An e s t i m a t e o f t h i s b e n e f i t c a n be d e r i v e d f r o m t h e p r e v i o u s a n a l y s i s o f t h e e c o n o m i c s o f d r o p t r a i l e r s . I n t h a t a n a l y s i s , ( S e c t i o n 3.3) i t was d e t e r m i n e d t h a t t h e u s e o f d r o p t r a i l e r s r e -s u l t e d i n a s a v i n g s o f a t l e a s t $49.60 p e r one way t r i p . I t w i l l b e s l i g h t l y l a r g e r when i n c r e a s e d t i m e a c c e s s i n g t h e f a c i l i t y i s c o n s i d e r e d . T h i s b e n e f i t a p p l i e s o n l y t o t h o s e u n i t s i n e x c e s s o f t h e 1981 t r a f f i c , o r t r a f f i c w h i c h w o u l d o t h e r w i s e h a v e t o use B.C. F e r r i e s . The d o l l a r v a l u e o f t h i s b e n e f i t t o g e n e r a t e d t r a f f i c has b e e n c a l c u l a t e d f o r e a c h y e a r and a p p e a r s i n Column A o f E x h i b i t 6.2. A s e c o n d b e n e f i t i s a s a v i n g s i n c o s t s t o v a r i o u s t r u c k -i n g f i r m s due t o a g r e a t e r a c c e s s i b i l i t y o f f a c i l i t i e s . T h i s i s a s a v i n g s i n t i m e and o p e r a t i n g c o s t s . S i n c e a l a r g e number o f t r i p s a r e g e n e r a t e d i n t h e Richmond, D e l t a and New W e s t m i n i s t e r a r e a s , a j o u r n e y t h r o u g h t h e c e n t r e o f V a n c o u v e r c o u l d be a v o i d e d . The s i z e o f t h i s b e n e f i t w i l l d epend on t h e volume o f t r a f f i c m o v i n g t h r o u g h t h e new f a c i l i t y . B.C.C.S.S. has e s t i m a t e d t h a t 40 p e r c e n t o f t h e t r a f f i c w o u l d be r o u t e d t h r o u g h i t . T h i s f i g u r e has b e e n s u b s t a n t i a t e d t h r o u g h an a n a l y s i s o f t r u c k i n g l o -c a t i o n s and movements. T h i s i n v o l v e d c o n t a c t s w i t h most c a r r i e r s -106-u s i n g B.C.C.S.S. f a c i l i t i e s . A l t h o u g h a l l c a r r i e r s were r e l u c -t a n t t o g i v e o u t d e t a i l e d i n f o r m a t i o n f o r c o m p e t i t i v e r e a s o n s , some g e n e r a l i z a t i o n s on t r a f f i c movements were o b t a i n e d . F o r some c a r r i e r s , t h e new l o c a t i o n w o u l d be much c l o s e r t o t h e i r t e r m i n a l s and a c c o r d i n g l y a l l t h e i r movements w o u l d be r o u t e d t h r o u g h i t . Domans f o r example, w o u l d be a l m o s t a d j a c e n t t o t h e t e r m i n a l . S a f e w a y , l o c a t e d i n s o u t h B u r n a b y , w o u l d f i n d 4 i t much more c o n v e n i e n t t o u s e t h e new f a c i l i t y . E x h i b i t 6.1 shows t h e l o c a t i o n s o f t h e m a j o r V a n c o u v e r - b a s e d u s e r s o f t h e d r o p t r a i l e r f a c i l i t i e s . As w e l l t h e l o c a t i o n s o f t h e p r o p o s e d f a c i l -i t y and t h e p r e s e n t f a c i l i t y a r e n o t e d . The c a r r i e r s n o t l i s t e d on t h e map a r e g e n e r a l l y b a s e d on V a n c o u v e r I s l a n d . The e s t i m a t e d number o f d a i l y t r a i l e r movements t h r o u g h t h e new f a c i l i t y a s s u m i n g i t w o u l d be c o m p l e t e d by t h e b e g i n n i n g o f 1978 a r e c o n t a i n e d i n - T a b l e 6.1. P e r s o n a l I n t e r v i e w w i t h Mr. M.T.. O l i v e r , T r u c k i n g D e p a r t m e n t Manager, Canada Safeway L i m i t e d . -10 7-EXHIBIT 6.1 GREATER VANCOUVER L e g e n d 1 P r e s e n t B.C.C.S.S. T e r m i n a l 6 C a p i t a l F r e i g h t w a y s 2 P r o p o s e d T e r m i n a l 7 Safeway 3 J o h n s t o n T e r m i n a l s 8 S i d n e y F r e i g h t L i n e s 4 C P . • T r a n s p o r t 9 Route o f t h e H i a d a s 5 Domans T r a n s p o r t 10 M a i r s T r a n s p o r t N o t e : 4A L o c a t i o n o f C P . T r a n s p o r t ' s p r o p o s e d t e r m i n a l . -108-TABLE 6.1 ANNUAL DIVERTED TRAFFIC VOLUMES Y e a r No. Y e a r No. 1978 40,560 1983 50,632 1979 42,574 1984 52,646 1980 44,589 1985 54,661 1981 46,603 1986 56,675 1982 48,618 1987 58,689 To o b t a i n t h e c o s t s a v i n g s f o r u n i t s d i v e r t i n g t o t h e new f a c i l i t y , t h e s a v i n g s i n t i m e and d i s t a n c e must be c a l c u l a t e d . T h i s i n v o l v e s d e t e r m i n i n g t h e number o f u n i t s m o v i n g f r o m e a c h 5 a r e a . I n f o r m a t i o n f r o m t h e C i t y E n g i n e e r i n g D e p a r t m e n t , B.C.C.S.S and t h e t r u c k i n g c ompanies were u s e f u l i n ma k i n g t h e e s t i m a t e s . The t r a f f i c o r i g i n s were t h e n g r o u p e d i n t o t h r e e a r e a s where t h e change i n d i s t a n c e s t o t h e t e r m i n a l s w o u l d be a p p r o x i m a t e l y t h e same. The t h r e e g r o u p s a r e : 1. Richmond and D e l t a T h i s g r o u p a l s o i n c l u d e s t h e i n d u s t r i a l a r e a a l o n g t h e n o r t h s h o r e o f t h e N o r t h Arm. T h i s g r o u p w o u l d have e a s i e s t a c c e s s t o t h e new f a c i l i t y , a nd a v o i d a t r i p a c r o s s V a n c o u v e r . 2. New W e s t m i n i s t e r T h i s g r o u p a l s o i n c l u d e s s o u t h B u r n a b y . T r a f f i c f r o m t h i s a r e a w o u l d use M a r i n e D r i v e t o a c c e s s C i t y P l a n n i n g D e p a r t m e n t T r u c k R o u t e S t u d y , V a n c o u v e r , 1974 and 19 75 T r u c k 0-D S t u d y , u n p u b l i s h e d p r e l i m i n a r y d a t a 1975. -109-t h e new t e r m i n a l r a t h e r t h a n K ingsway and M a i n t o downtown. 3. F r a s e r M i l l s , C o q u i t l a n and P o i n t s E a s t on Hwy. 401 T h i s t r a f f i c w o u l d n o r m a l l y u s e Highway 401 o r t h e L o u g h e e d Highway t o a c c e s s H a s t i n g s S t r e e t o r G r a n d v i e w S t r e e t . F o r e a c h o f t h e s e t h r e e g r o u p s , t h e d i s t a n c e and t i m e s a v i n g s were c a l c u l a t e d . T h e s e , as w e l l as t h e t r a f f i c f l o w s a r e c o n t a i n e d i n t h e f o l l o w i n g t a b l e . TABLE 6.2 DIVERTED TRAFFIC A r e a 1. D e l t a and Richmond 2. New W e s t m i n i s t e r T r a f f i c S o u r c e 45% 35% 3. F r a s e r M i l l s , C o q u i t l a n , P o i n t s E a s t 20% S a v i n g s i n M i l e s 8.5 6.0 2.0 S a v i n g s i n Time 45 m i n u t e s 30 m i n u t e s 12 m i n u t e s The i m p o r t a n c e o f t h e b e n e f i t t o d i v e r t e d t r a f f i c l i e s i n t h e s a v i n g o f t i m e . The i m p o r t a n t q u e s t i o n i s what i s t h e v a l u e o f t h i s t i m e s a v i n g s ? I n m o s t B e n e f i t - C o s t s t u d i e s i n v o l -v i n g p u b l i c t r a n s p o r t p r o j e c t s t h i s q u e s t i o n l e a d s t o v a r i e d o p i n i o n s . T h e r e i s no " c o r r e c t " v a l u e as e v e r y o n e v a l u e s t i m e i n a d i f f e r e n t way. I n t h i s c a s e t h e v a l u e o f t i m e i s l e s s c omplex s i n c e we a r e v a l u i n g t h e t i m e o f a r e l a t i v e l y homogeneous r e s o u r c e , a t r a c t o r - t r a i l e r c o m b i n a t i o n . The t i m e s a v e d a l l o w s f u r t h e r a c t i v i t i e s t o be engaged, h e n c e more e c o n o m i c v a l u e can be p r o --110-duced w i t h the l a b o u r and resources r e l e a s e d . The value of time becomes the o p p o r t u n i t y c o s t of the u n i t . In Chapter 3, the o p p o r t u n i t y c o s t of a t r a c t o r t r a i l e r u n i t was determined to be approximately $22.63 per hour. T h i s f i g u r e i s then a p p l i e d to the time savings f o r each area on a y e a r l y b a s i s . For example, i n 19 80, the t r a f f i c from area three would save approximately 1783 hours, w i t h a value of $40,349. These b e n e f i t s appear i n column B of E x h i b i t 6.2. There would be a b e n e f i t to downtown Vancouver i f drop t r a i l e r t r a f f i c d i v e r t e d to an a l t e r n a t e l o c a t i o n . T h i s b e n e f i t would be i n the form of l e s s c o n g e s t i o n , n o i s e and p o l l u t i o n . The s i z e of the b e n e f i t would depend on the amount of t r a f f i c d i -v e r t e d . The C i t y E n g i n e e r i n g Department, i n t h e i r study o f t r u c k routes determined t h a t t r u c k s make up 15 p e r c e n t of the urban t r a f f i c stream.^ About 70 p e r c e n t of t h i s t r a f f i c i s composed of l i g h t e r t r u c k s (2 axle w i t h l e s s than 40,000 GVW) w i t h operat-i n g c h a r a c t e r i s t i c s s i m i l a r to c a r s . Truck i n t e r f e r e n c e w i t h g e n e r a l t r a f f i c i s thus caused by the l a r g e r t r u c k s which account f o r l e s s than 5 p e r c e n t of a l l v e h i c l e s i n the t r a f f i c stream. 6 I b i d . , Truck Route Study, p. 7. -111-Of a l l the trucks i n the over 40,000 GVW class, t r a c t o r t r a i l e r units account for approximately 30 percent, the remainder 7 bexng 3-axle and dump trucks. However, even though t h e i r num-bers are small, they do have a disproportionate influence on con-gestion due to th e i r size and acceleration/deceleration charac-t e r i s t i c s . Larger trucks also have the d i s t i n c t i o n of being very noisy. The human ear can adjust to sounds up to 80 decibels (db). Lighter units such as 2-axle trucks usually generate noise levels less than 75 db. Tractor t r a i l e r units however, often generate noise greater than 80 db. Noise monitering studies indicate that d i e s e l trucks are approximately 8 db. louder than gasoline powered o trucks, and 13 db. louder than automobiles. The r e s u l t i s that large trucks are c l e a r l y audible and a major cause of annouance, i n the form of loss of sleep, i n t e r -ference with conversation, and loss of amenities afforded by a quiet environment. Numerous studies e x i s t r e l a t i n g to the topic of noise and i t s effects on the surrounding environment. As vechular t r a f f i c continues to increase, noise l e v e l s w i l l also, and the environmentally aware public w i l l put increasing pressure on government for tighter controls and r e s t r i c t i o n s . 7 Ibid., Truck Route Study. g Shaw,.Michael F., Truck Noise Reudction: A Review of Alternative Strategies. Report 42 Canadian Transport Commission,. Ottawa, Ontario. 1972, page 9. - 1 1 2 -U n l i k e t h e o t h e r b e n e f i t s o f a p a r t i a l r e l o c a t i o n , t h e d e c r e a s e i n n o i s e and c o n g e s t i o n has a f i n i t e t e r m . I t w i l l l a s t u n t i l t h e c a p a c i t y o f t h e p r e s e n t s y s t e m i s r e a c h e d g i v e n t h a t t h e a l t e r n a t e l o c a t i o n i s c o m p l e t e d . The b e n e f i t i s d e r i v e d f r o m l e s s h e a v y t r u c k t r a f f i c i n t h e downtown a r e a . F i g u r e A p r e s e n t s a v i s u a l i n t e r p r e t a t i o n o f t h e volume o f t r a f f i c t h e b e n e f i t i s g e n e r a t e d f r o m . FIGURE A DIVERTED TRAFFIC Number o f U n i t s Time I n F i g u r e A, t h e l i n e AB r e p r e s e n t s t h e e x p e c t e d t r a f f i c t o t h e downtown f a c i l i t y p r o v i d i n g no a l t e r n a t e l o c a t i o n was c o n s t r u c t e d . F u l l c a p a c i t y w o u l d be r e a c h e d a t p o i n t B. The l i n e DC i s t h e t r a f f i c t o t h e downtown f a c i l i t y i f t h e new f a c i l i t y i s b u i l t . T h i s t r a f f i c w o u l d a l s o r e a c h c a p a c i t y , r e p r e s e n t e d by t h e l i n e BC. L i n e AD w o u l d be t h e t r a f f i c d i v e r t e d t o t h e new -113-f a c i l i t y a t i t s opening. The shaded area i s the amount of t r a f f i c d i v e r t e d from the o l d f a c i l i t y , u n t i l t h a t f a c i l i t y i s again a t i t s f u l l c a p a c i t y . I t i s the removal of t h i s t r a f f i c from the downtown area t h a t produces the b e n e f i t of l e s s n o i s e and conges-t i o n . V a l u a t i o n of t h i s i n t a n g i b l e b e n e f i t i s extremely d i f f i c u l t . S e v e r a l s t u d i e s have been conducted i n r e c e n t years concerning the measuring of the c o s t s of n o i s e and a i r p o l l u t i o n , e s p e c i a l l y t h a t i n and around a i r p o r t s . F e l l e r and Nelson suggest s e v e r a l c o n c e p t u a l problems s t i l l e x i s t i n the v a l u a t i o n and enumeration of such c o s t s , and as y e t u s e f u l g u i d e l i n e s f o r p o l i c y 9 f o r m u l a t i o n do not e x i s t . S e v e r a l methods have been used i n the attempt to measure nuisance c o s t s . The i d e a l measure i n t h i s study would be the e x t r a nuisance generated by one t r u c k . An a l t e r n a t e e s t i m a t i o n c o u l d be achieved through d i r e c t i n t e r v i e w s of persons a f f e c t e d . The c o s t of the nuisance i s then the maximum sum they would be w i l l i n g to g i v e to be on the same l e v e l of u t i l i t y w ithout the n u i s a n c e . 1 ^ E m p e r i c a l problems e x i s t w i t h t h i s approach because people would tend to g i v e b i a s e d answers. A l s o i t would not sim-u l a t e r e a l market c o n d i t i o n s . 9 F e l l e r , I . , Nelson Jon P., Economic Aspects of Noise P o l l u t i o n , U n i v e r s i t y Park, P e n n s y l v a n i a 16802, A p r i l 1973, page 13. " ^ G a u t r i n , J.F., The Economics of A i r c r a f t Noise, U n i v e r s i t e L a v a l , June 1971. -114-One of the most wi d e l y used approaches f o r the measure-ment of nuisance i s i t s e f f e c t on r e s i d e n t i a l p r o p e r t y v a l u e s . The theory behind t h i s method i s t h a t persons purchase p r o p e r t y (land and improvements) f o r the stream or flow of s e r v i c e s they produce, i . e . , space, l o c a t i o n , p r o t e c t i o n a g a i n s t crime and the elements, and v a r i o u s a m e n i t i e s . The p r i c e o f a house w i l l i n -crease or decrease depending on the flow of s e r v i c e s from i t . Thus the presence o f a nuisance w i l l reduce the v a l u a t i o n of the amenity s e r v i c e . The decrease i n the v a l u a t i o n o f the amenity s e r v i c e w i l l be e x a c t l y equal to the f a l l i n the house p r i c e . T h e r e f o r e , f o r a g i v e n area t h a t i n c l u d e s "noisy and q u i e t " houses the c o s t of the n o i s e should be r e f l e c t e d i n the change i n the p r i c e s of the houses, a l l other t h i n g s being e q u a l . F i g u r e B presents t h i s theory g r a p h i c a l l y . FIGURE B HOUSE PRICES M a r g i n a l Money Values n o i s y N i N , q u i e t -115-The l i n e MM' i s t h e m a r g i n a l money v a l u a t i o n a t t a c h e d t o a house w i t h a p a r t i c u l a r n o i s e l e v e l . An i n c r e a s e i n t h e l e v e l o f n o i s e f r o m N Q t o N^ w o u l d p r o d u c e a change i n t h e p r i c e o f t h e h o u s e B. The sum o f t h e d e c r e a s e s o f a l l h o u s e s a f f e c t e d by t h e i n t r o d u c t i o n on a n o i s e w o u l d r e p r e s e n t t h e c o s t o f t h a t n o i s e . F e l l e r and N e l s o n n o t e t h e s t u d i e s u s i n g t h i s a p p r o a c h i n d i c a t e t h a t r e d u c t i o n i n p r o p e r t y v a l u e s does o c c u r due t o p o l l u t i o n , b u t s u g g e s t some u n c e r t a i n t y as t o t h e m a g n i t u d e o f t h e r e d u c t i o n s . A l l t h e s e a p p r o a c h e s t o t h e measurement o f n u i s a n c e c o s t s s h a r e t h e same c h a r a c t e r i s t i c s . They a r e l a r g e cumbersome u n d e r -t a k i n g s , c o s t l y , t i m e c o n s u m i n g , and c o n t a i n s e v e r a l p r o b l e m s . As a r e s u l t t h e y do n o t l e n d t h e m s e l v e s t o a g o o d e s t i m a t e f o r t h e p u r p o s e s o f t h i s s t u d y w i t h o u t a m a j o r u n d e r t a k i n g . To a v o i d t h e i n a c c u r a c y u s i n g a " f a s t and d i r t y " number w h i c h c o u l d a l s o i m p a i r t h e o t h e r r e s u l t s , t h e m e a s u r i n g o f t h e n u i s a n c e b e n e f i t w i l l be i g n o r e d f o r t h e p r e s e n t t i m e . T h i s does n o t p r e s e n t any. s e r i o u s p r o b l e m s as t h e b e n e f i t s and c o s t s c a n be compared w i t h t h e a b s e n c e o f t h i s b e n e f i t . T h i s a l l o w s one t o s e e i f t h e n u i s a n c e b e n e f i t w o u l d be i n a p o s i t i o n t o s e r i o u s l y i n f l u e n c e t h e r e s u l t s d e p e n d i n g on i t s m a g n i t u d e . -116-6.1.4 D i s c o u n t R a t e The c h o i c e o f an a p p r o p r i a t e d i s c o u n t r a t e i s i m p o r t a n t as i t d i r e c t l y a f f e c t s t h e s i z e o f f u t u r e c a s h f l o w s . The m a i n c o n s i d e r a t i o n w i t h t h i s p a r t i c u l a r a n a l y s i s i s t h a t i t w o u l d be u n d e r t a k e n i n t h e p r i v a t e s e c t o r . Thus t h e most a p p r o p r i a t e i n t e r e s t r a t e w o u l d be t h e p r i v a t e o p p o r t u n i t y c o s t . The p r o b l e m l i e s i n m e a s u r i n g t h i s r a t e . A g u i d e t o t h i s d i s c o u n t r a t e w o u l d be t h e i n t e r n a l r a t e o f r e t u r n on p r o j e c t s f o r e g o n e . Un-f o r t u n a t e l y t h i s i n f o r m a t i o n i s n o t a v a i l a b l e , however a f a i r l y g o o d e s t i m a t e c a n be made. The r a t e o f r e t u r n on a s s e t s f o r C P . R a i l i s e x t r e m e l y low, and i s n o t c o n s i d e r e d a g o od a p p r o x i -m a t i o n . The r a t e o f r e t u r n on e q u i t y , w h i c h c a n be u s e d f o r a g u i d e was i n t h e 8.7 t o 9.8 p e r c e n t r a n g e i n t h e p a s t two y e a r s . A n o t h e r g u i d e i s t h e l o n g t e r m d e b t r a t e . Bonds i s s u e d i n 19 74 and 19 75 were 10.35 p e r c e n t and 11.25 percent-. W i t h t h e s e two f i g u r e s as a g u i d e , a r a t e o f 12 p e r c e n t has b e en u s e d . To t e s t t h e s e n s i t i v i t y o f t h e r e s u l t s t o t h e d i s c o u n t r a t e , o t h e r r a t e s o f 10 p e r c e n t and 14 p e r c e n t h a v e b e e n u s e d as w e l l . The c o s t s and b e n e f i t s f o r t h e p r o p o s e d r e l o c a t i o n a r e s ummarized i n E x h i b i t 6.2 on a y e a r l y b a s i s . S i n c e t h e p u r p o s e o f r e l o c a t i o n i s t o s a t i s f y B.C.C.S.S.'s i n t e r m e d i a t e r e q u i r e m e n t s , a t e r m o f 10 y e a r s i s u s e d . A f t e r t h a t t i m e a c o m p l e t e r e l o -c a t i o n o f t h e downtown f a c i l i t i e s w i l l t a k e p l a c e t o t h i s o r a n o t h e r l o c a t i o n . E X H I B I T 6 . 2 B E N E F I T S AND C O S T S O F B U I L D I N G AN A D D I T I O N A L DROP T R A I L E R F A C I L I T Y I. B E N E F I T S : A . B . Y E A R C O S T S A V I N G S (S) C O S T S A V I N G S T O D I V E R T E D T R A F F I C : (BY A R E A ) ($) (1) (2) (3;) 12% T O T A L B E N E F I T S D I S C O U N T E D A T : 10% 14% 1 9 7 8 3 0 9 , 7 8 2 1 6 0 , 6 2 8 3 6 , 7 0 6 4 5 2 , 7 5 3 4 6 1 , 0 1 9 4 4 4 , 8 4 2 1 9 7 9 3 2 5 , 1 7 0 1 6 8 , 6 1 6 3 8 , 5 1 6 4 2 4 , 3 5 1 4 3 9 , 8 9 4 4 0 9 , 6 0 6 1 9 8 0 3 4 0 , 5 8 9 1 7 6 , 5 8 2 4 0 , 3 4 9 3 9 6 , 8 4 3 4 1 8 , 8 6 4 3 7 6 , 3 2 6 1 9 8 1 7 4 , 7 9 6 3 5 5 , 9 2 5 1 8 4 , 5 4 8 4 2 , 1 8 2 4 1 7 , 8 1 0 4 4 9 , 0 3 9 3 8 9 , 2 7 7 1 9 8 2 3 2 4 , 5 8 2 3 7 1 , 3 3 6 1 9 2 , 5 3 6 4 3 , 9 9 2 5 2 9 , 0 6 9 5 7 8 , 9 5 6 4 8 4 , 2 1 9 1 9 8 3 5 7 4 , 3 6 8 3 8 6 , 7 0 1 2 0 0 , 5 2 4 4 5 , 8 2 6 6 1 1 , 6 7 8 6 8 1 , 5 8 8 5 5 0 , 1 0 1 1 9 8 4 8 2 4 , 1 5 4 4 0 2 , 1 5 8 2 0 8 , 4 9 0 4 7 , 6 3 6 6 7 0 , 5 0 7 7 6 0 , 7 8 7 5 9 2 , 3 8 2 1 9 8 5 1 , 0 7 3 , 9 3 9 4 1 7 , 4 7 8 2 1 6 , 4 7 8 4 9 , 4 6 9 7 0 9 , 7 9 9 8 1 9 , 8 1 0 6 1 6 , 1 3 2 1 9 8 6 1 , 3 2 4 , 2 2 1 4 3 2 , 8 6 6 2 2 4 , 4 4 4 5 1 , 2 7 9 7 3 3 , 0 3 1 8 5 3 , 9 8 3 6 2 5 , 0 8 9 1 9 8 7 1 , 5 7 3 , 5 1 0 4 4 8 , 2 5 5 2 3 2 , 4 2 3 5 3 , 1 1 3 7 4 2 , 7 2 0 5 , 6 8 8 , 5 6 1 8 8 9 , 4 6 4 6 , 3 5 3 , 4 0 4 6 2 2 , 2 7 9 5 , 1 1 0 , 2 5 3 I I . C O S T S : ( F r o m S e c t i o n 6 . 1 .2 ) $ 2 , 2 6 6 , 0 0 0 l e s s R e s i d u a l a n d p i e r v a l u e o f l a n d ( 1 , 8 0 0 , 0 0 0 ) 1 , 6 8 6 , 5 8 0 1 , 5 7 2 , 1 0 0 1 , 7 8 0 , 5 4 0 I I I . N E T B E N E F I T S 4 , 0 0 1 , 9 8 1 4 , 7 8 1 , 3 0 4 3 , 3 2 9 , 7 1 3 -118-6.2 C o n c l u s i o n s E x h i b i t 6.2 i n d i c a t e s t h a t t h e n e t b e n e f i t s o f r e l o c a t i n g p a r t o f t h e p r e s e n t f a c i l i t i e s a r e s u b s t a n t i a l . The new f a c i l i t y c a n be c o n s t r u c t e d and p u t i n t o o p e r a t i o n w i t h a minimum amount o f c o n s t r u c t i o n and c a p i t a l o u t l a y . The E x h i b i t a l s o i n d i c a t e s t h e p r o j e c t i s a t t r a c t i v e i f C.P.'s p l a n n i n g h o r i z o n i s l e s s t h a n t e n y e a r s . I n o r d e r t o t e s t t h e s e n s i t i v i t y o f t h e r e s u l t s t o t h e f o r e c a s t e d v o l u m e s , an a n a l y s i s i s a l s o made u s i n g t h e l o w e r l i m i t e s t i m a t e d e v e l o p e d i n S e c t i o n 4.2. E v e n t h o u g h t h e a n n u a l i n c r e a s e i s 20 p e r c e n t l o w e r , t h e n e t b e n e f i t s a r e s t i l l p o s i t i v e i n d i c a t -i n g t h e p r o j e c t s w o u l d be a c c e p t a b l e . W i t h a 12 p e r c e n t d i s c o u n t r a t e , t h e n e t b e n e f i t s w o u l d be $2,713,213 and $2,193,792 f o r a 14 p e r c e n t d i s c o u n t r a t e . The weakness a s s o c i a t e d w i t h t h i s a n a l y s i s i s t h a t up t o now i t has i g n o r e d t h e f i n a n c i n g o f t h e p r o j e c t . I n E x h i b i t 6.2 a l l t h e b e n e f i t s a c c r u e t o p a r t i e s o t h e r t h a n t h e B.C.C.S.S. T y p i c a l l y i n s o c i a l c o s t b e n e f i t a n a l y s i s t h e d i s t r i b u t i o n a l e f f e c t s a r e i g n o r e d s o l o n g as t h e g a i n e r c o u l d compensate t h e l o s e r s . I n t h i s p r o j e c t a p r i v a t e f i r m w i l l have t o make t h e de-c i s i o n as w e l l as t h e c a p i t a l e x p e n d i t u r e s , t h u s an e x a m i n a t i o n o f t h e d i s t r i b u t i o n o f b e n e f i t s and c o s t s i s n e c e s s a r y . T h e o r e t i c a l l y , t h e g a i n e r s i n t h i s p r o j e c t , i . e . t h e -119-t r u c k i n g c ompanies who use t h e f a c i l i t y , s h o u l d be w i l l i n g t o pay a premium t o u s e t h e new f a c i l i t y s i n c e i t w o u l d p r o d u c e a s a v i n g s t o them. The amount o f t h i s premium w o u l d be l e s s t h a n o r e q u a l t o t h a t s a v i n g . A n o t h e r a p p r o a c h w o u l d be t o examine t h e b e n e f i t s f r o m t h e p o i n t o f v i e w o f t h e B.C.C.S.S. The b e n e f i t t o them w o u l d be t h e a b i l i t y t o i n c r e a s e r e v e n u e s and t h u s p r o f i t s by b e i n g a b l e t o e x t e n d t h e i r c a p a c i t y b e y o n d 19 79. I f t h e B.C.C.S.S. o p e r a t i n g e c o n o m i c s and p r o f i t a b i l i t y were known, i t w o u l d be a f a i r l y s i m -p l e t a s k t o measure t h e b e n e f i t o f g e n e r a t e d t r a f f i c . I f t h e p r o -f i t s f r o m l o s t t r a f f i c due t o no f a c i l i t i e s a r e e q u a l t o t h e c o s t o f b u i l d i n g t h e f a c i l i t i e s , t h e n i t w o u l d be b u i l t . S i n c e t h e p r o f i t m a r g i n on f e r r y i n g d r o p t r a i l e r s i s n o t known, t h e s i z e o f t h e b e n e f i t c a n n o t be d e t e r m i n e d . However -the b e n e f i t c a n be a n a l y z e d by two a l t e r n a t e methods. F i r s t , we c a n assume a r e q u i r e d r a t e o f r e t u r n on c a p i t a l i n v e s t e d , and d e t e r m i n e i f t h e p r o f i t s g e n e r a t e d w o u l d j u s t i f y t h e e x p e n d i t u r e . S e c o n d l y , t h e r a t e c a n be d e t e r m i n e d t h a t w i l l j u s t i f y t h e e x p e n d i t u r e . I n o t h e r words, t h a t r a t e t h a t w i l l e q u a t e t h e d i s c o u n t e d c o s t s and b e n e f i t s . The f i r s t method s u g g e s t s we assume a r a t e o f r e t u r n . S i n c e t h e d i s c o u n t r a t e o f 12 p e r c e n t was u s e d p r e v i o u s l y as t h e r a t e on p r o j e c t s f o r e g o n e , t h e same r a t e w o u l d be a p p r o p r i a t e f o r t h i s a n a l y s i s . The f i r s t s t e p i s t o d e t e r m i n e t h e number o f u n i t s - 1 2 0 -g e n e r a t e d b y t h e n e w f a c i l i t y , t h e r e v e n u e t h e y p r o d u c e , a n d t h e p r o f i t s t h e y g e n e r a t e . S i n c e t h e e x i s t i n g f a c i l i t i e s w o u l d n o t b e s a t u r a t e d u n t i l m i d 19 8 1 , t h e t r a f f i c w e a r e i n t e r e s t e d i n i s t h e e x c e s s b e y o n d t h a t d a t e . T h i s i n f o r m a t i o n i s i n c l u d e d i n T a b l e 6 . 3 . T A B L E 6 . 3 R E V E N U E AND P R O F I T E S T I M A T E S Y E A R T R A F F I C R E V E N U E P R O F I T 1 N o . o f U n i t s $ ( A v e r a g e ) $ 1 9 8 1 1 , 5 0 8 1 2 2 , 9 0 2 9 , 3 7 3 1 9 8 2 6 , 5 4 4 5 3 3 , 3 3 6 3 6 , 3 1 3 1 9 8 3 1 1 , 5 8 0 9 4 3 , 7 7 0 5 7 , 3 7 4 1 9 8 4 1 6 , 6 1 6 1 , 3 5 4 , 2 0 4 7 3 , 5 0 0 1 9 8 5 2 1 , 6 5 2 1 , 7 6 4 , 6 3 8 8 5 , 5 2 8 1 9 8 6 2 6 , 6 8 8 2 , 1 7 5 , 0 7 2 9 4 , 1 2 0 1 9 8 7 3 1 , 7 2 4 2 , 5 8 5 , 5 0 6 9 9 , 8 7 2 1 9 8 8 3 6 , 7 6 0 2 , 9 9 5 , 9 4 0 1 0 3 , 3 5 9 1 9 8 9 4 1 , 7 9 6 3 , 4 0 6 , 3 7 4 1 0 4 , 9 2 9 1 9 9 0 4 6 , 8 3 2 3 , 8 1 6 , 8 0 8 1 0 4 , 9 7 7 7 6 9 , 3 4 5 N O T E 1. P r o f i t f i g u r e s a r e d i s c o u n t e d a t 12 p e r c e n t . T a b l e 6 . 3 i n d i c a t e s t h a t t h e d i s c o u n t e d s t r e a m o f p r o -f i t s u p t o a n d i n c l u d i n g 1 9 9 0 a r e $ 7 6 9 , 3 4 5 a s s u m i n g a r e q u i r e d r a t e o f 12 p e r c e n t , a n d a 10 y e a r l i f e . T h e r e f o r e , i f t h e a s s u m p -t i o n o f B . C . C . S . S . ' s r a t e o f r e t u r n i s c o r r e c t , t h e n t h e p r o j e c t w o u l d n o t b e a c c e p t a b l e s i n c e t h e d i s c o u n t e d b e n e f i t s w o u l d b e l e s s t h a n t h e d i s c o u n t e d c o s t s o f $ 8 6 0 , 6 2 3 . T h e n e t b e n e f i t s d o b e c o m e p o s i t i v e , o r t h e p r o j e c t b e c o m e s a c c e p t a b l e i f t h e p l a n n i n g h o r i z o n e x t e n d s b e y o n d t e n y e a r s , o r i f t h e d i s c o u n t r a t e i s 1 0 % . -121-The o b v i o u s q u e s t i o n w h i c h a r i s e s f r o m T a b l e 6.3 i s t h e a c t u a l c o n s t r u c t i o n t i m e o f t h e p r o j e c t , C o m p a r i n g T a b l e 6.3 and E x h i b i t 6.2, f r o m t h e p o i n t o f v i e w o f t h e B.C.C.S.S., t h e p r o j e c t n e e d n o t be s t a r t e d u n t i l m i d 1981 when t h e e x i s t i n g f a c i l i t y i s n e a r i n g a b s o l u t e c a p a c i t y . The b e n e f i t i n w a i t i n g however, w o u l d be t o keep v a r i o u s o p t i o n s open as l o n g as p o s s i b l e . The s e c o n d method o f a n a l y s i n g t h e a c c e p t a b i l i t y f r o m t h e v i e w o f t h e p r i v a t e f i r m i s t o d e t e r m i n e t h e r a t e a t w h i c h t h e d i s c o u n t e d b e n e f i t s ( p r o f i t s ) a c c u r i n g t o B.C.C.S.S. w i l l e q u a l t h a t o f t h e c a p i t a l e x p e n d i t u r e . T h i s method i n v o l v e s a c e r t a i n amount o f t r i a l and e r r o r c a l c u l a t i o n / as w e l l as i n t e r -p o l a t i o n . However, t h e r e s u l t i s t h a t t h e p r o j e c t w o u l d have t o e a r n a r a t e o f 13.42 p e r c e n t i n o r d e r t o meet t h e c a p i t a l o u t l a y . Thus t h e d e c i s i o n o f management, ( i f e c o n o m i c s were t h e o n l y 1 c r i t e r i a ) c a n be p u t i n t o p e r s p e c t i v e . I n o t h e r w o r d s , i f t h e p r i c i n g s t r u c t u r e o f B.C.C.S.S. was c o n s t r u c t e d t o g e n e r a t e a r a t e o f s a y 13.42 p e r c e n t o r b e t t e r , t h e n t h e p r o j e c t w o u l d be a c c e p t e d . Chapter 7 Summary and Con c l u s i o n s -123-7.1 Review and Summary The s i z e o f V a n c o u v e r I s l a n d , i n terms o f p o p u l a t i o n and e c o n o m i c i m p o r t a n c e n e c e s s i t a t e s an e f f i c i e n t and c o n t i n u o u s l i n k w i t h t h e B.C. M a i n l a n d . The f e r r y s y s t e m has b e e n a v i t a l component i n p r o v i d i n g s u c h c o m m u n i c a t i o n . F r e i g h t t r a f f i c i s p a r t i c u l a r i t y i m p o r t a n t , s i n c e i t i s a l m o s t e n t i r e l y d e p e n d e n t on w a t e r t r a n s p o r t a t i o n . T h i s t r a f f i c has been g r o w i n g s t e a d i l y , w i t h an i n c r e a s e d e m p h a s i s on m o t o r f r e i g h t t r a n s p o r t a t i o n . T h i s t h e s i s has s t u d i e d a number o f a s p e c t s o f d r o p t r a i l e r t r a f f i c , a s u b j e c t h i t h e r t o l a c k i n g i n p u b l i s h e d i n f o r -m a t i o n . By m e e t i n g t h e o b j e c t i v e s o f t h e t h e s i s , i t i s h o p e d a l a r g e s t e p c a n be made i n f i l l i n g t h i s v o i d . The f i r s t o b j e c t i v e i s an a n a l y s i s o f t h e e c o n o m i c s o f s h i p p i n g v i a d r o p t r a i l e r . S e c o n d l y , t h e s i z e i m p o r t a n c e a n d r e c e n t t r e n d s i n t h i s t r a f f i c i s s t u d i e d , and a p r o j e c t i o n o f f u t u r e t r a f f i c i s made. The t h i r d o b j e c t i v e i s an a n a l y s i s o f t h e p h y s i c a l f a c i l -i t i e s a v a i l a b l e t o d r o p t r a i l e r s . T h i s a n a l y s i s d e a l s w i t h t h e c u r r e n t q u e s t i o n o f a r e l o c a t i o n o f f a c i l i t i e s . One a l t e r n a t i v e t o ^complete r e l o c a t i o n , i s a p a r t i a l r e l o c a t i o n o f f a c i l i t i e s . An a n a l y s i s o f t h e c o s t s a n d b e n e f i t s i s p e r f o r m e d t o d e t e r m i n e t h e n e t b e n e f i t s o f s u c h a p r o j e c t . The body o f i n f o r m a t i o n c o n t a i n e d i n t h i s t h e s i s w i l l be u s e f u l as a b a s e f o r f u t u r e r e s e a r c h e r s w o r k i n g i n r e l a t e d a r e a s . -124-I n o r d e r t o u n d e r s t a n d t h e c u r r e n t s i t u a t i o n i n t h e d r o p • t r a i l e r i n d u s t r y , a k nowledge o f i t s e v o l u t i o n and d e v e l o p m e n t i s i m p o r t a n t . T h i s i n f o r m a t i o n i s c o n t a i n e d i n C h a p t e r 2 w h i c h d e v e l o p s t h e i m p o r t a n c e o f V a n c o u v e r I s l a n d , t h e g e n e r a l p r o b l e m o f f r e i g h t t r a n s p o r t a t i o n t o i t , and a b r i e f h i s t o r y o f t h e f e r r y s y s t e m . Up u n t i l 1958, t h e f e r r y s e r v i c e t o t h e I s l a n d was o p e r -a t e d e n t i r e l y by p r i v a t e e n t e r p r i s e . A f t e r t h a t d a t e , t h e Government t o o k o v e r t h e s e r v i c e , and embarked on a r a p i d e x p a n -s i o n o f t h e f l e e t and t e r m i n a l f a c i l i t i e s . I t became an e f f i c i e n t s y s t e m o r i e n t e d t o a u t o m o b i l e and p a s s e n g e r t r a f f i c , and f e a t u r e d r a p i d s a i l i n g and t u r n a r o u n d t i m e s . As t h e h a n d l i n g o f d r o p t r a i l e r s and o t h e r t r a f f i c d i d n o t mix w e l l , t h e y were r e s t r i c t e d i n 1968, and t o t a l l y b a n n e d i n 1973. As a r e s u l t , B r i t i s h C o l u m b i a C o a s t a l S t e a m s h i p S e r v i c e h a n d l e d t h i s t r a f f i c and has emerged as p r i m a r i l y a s p e c i a l i z e d d r o p t r a i l e r c a r r i e r . W i t h t h e c u r r e n t c o n g e s t i o n and p e a k i n g p r o b l e m s on B.C. F e r r i e s , B.C.C.S.S.'s s e r v i c e i s now an i m p o r t a n t s u p p l e m e n t t o t h e i r c a p a c i t y . Thus t h e two c a r r i e r s a r e e s s e n t i a l l y n o n - c o m p e t i n g w i t h r e s p e c t t o t h e i r t r a f f i c . B.C.C.S.S. i s now t h e o n l y company t o p r o v i d e d r o p t r a i l e r s e r v i c e t o t h e I s l a n d . S e v e r a l t r u c k i n g c o m p a n i e s m o v i n g t r a i l e r s t o t h e I s l a n d have f o u n d t h i s s e r v i c e v e r y a d v a n t a g e o u s t o t h e i r o p e r a t i o n s . I t a l l o w s them t o r e s e r v e s p a c e on e a c h s a i l i n g , d e l i v e r t h e t r a i l e r t o t h e y a r d a t t h e i r c o n v e n i e n c e and l i t e r a l l y d r o p them o f f , and h a ve p r i o r i t y o v e r a u t o m o b i l e t r a f f i c . The s y s t e m e l i m i n a t e s t h e n e e d f o r t h e d r i v e r and t r a c t o r u n i t t o -125-accompany t h e t r a i l e r on t h e f e r r y , t h e r e b y s a v i n g c o s t l y i d l e t i m e . The a n a l y s i s o f t h e e c o n o m i c s o f d r o p t r a i l e r s f o u n d t h a t on t h e V a n c o u v e r t o I s l a n d r o u t e s , t h e u s e r o f t h e s y s t e m c o u l d s a v e a minimum o f a p p r o x i m a t e l y $49 p e r t r i p r a t h e r t h a n s e n d i n g i t as a l i v e u n i t on B.C. F e r r i e s . The t r a f f i c a n a l y s i s f o u n d t h a t t h e r e i s a s m a l l number o f companies u s i n g t h e d r o p t r a i l e r f a c i l i t i e s . However, t h e s e u s e r s h a v e b e e n s h i p p i n g t r a i l e r s i n s u b s t a n t i a l v o l u m e s . The s e r v i c e demanded by t h e s e u s e r s i s o v e r n i g h t , t h u s t h e s a i l i n g s a r e s c h e d u l e d t o meet t h i s n e e d . Drop t r a i l e r t r a f f i c has b e e n g r o w i n g a t an a v e r a g e a n n u a l r a t e o f a b o u t 7.3 p e r c e n t o v e r t h e p a s t 10 y e a r s . A i d i n g t h i s g r o w t h has b e e n a c o n t i n u i n g s h i f t o f r a i l t r a f f i c t o h ighway t r a n s p o r t . Volume f i g u r e s i n d i c a t e r a i l -c a r t r a f f i c has b e e n d e c l i n i n g a t 5 p e r c e n t o v e r t h e l a s t 8 y e a r s . Drop t r a i l e r s s u f f e r f r o m a f r e i g h t i m b a l a n c e o f 4:1 i n f a v o r o f w e s t b o u n d movements o v e r e a s t b o u n d . F o r t h e r a i l w a y s , t h e i m b a l a n c e i s more s e v e r e , 6:1, b u t i n f a v o r o f e a s t b o u n d s h i p -ments o v e r w e s t b o u n d . The s o l u t i o n t o t h e t w i n b a c k h a u l p r o b l e m may l i e i n a move t o a s i n g l e mode, i f i t c a n be shown t o be e c -o n o m i c a l l y p o s s i b l e . Drop t r a i l e r t r a f f i c d oes n o t s u f f e r f r o m t h e s e a s o n a l v a r i a t i o n s t h a t p l a g u e t h e B.C. F e r r i e s . The m a i n c o m m o d i t i e s c a r r i e d by d r o p t r a i l e r s a r e g e n e r a l m e r c h a n d i s e and consumer g o o d s , w h i c h do n o t v a r y g r e a t l y by s e a s o n . A r e g r e s s i o n a n a l y s i s o f t h e t r a f f i c v olumes p r o d u c e d a r e g r e s s i o n e q u a t i o n f o r t h e g r o w t h . -126-U s i n g t h i s t r e n d , t h e a n t i c i p a t e d f u t u r e v o l u m e s o f t r a f f i c a r e e x p e c t e d t o i n c r e a s e a t 5,036 u n i t s p e r y e a r . An a n a l y s i s o f B.C.C.S.S. f a c i l i t i e s r e v e a l e d s e v e r a l p r o b l e m s w h i c h w i l l g r e a t l y a f f e c t f u t u r e o p e r a t i o n s . The c a p a c i t y o f t h e s y s t e m was f o u n d t o be r a p i d l y a p p r o a c h i n g a p o i n t o f s a t -u r a t i o n . T h i s a p p l i e s t o b o t h v e s s e l c a p a c i t y and t e r m i n a l f a c i l -i t i e s . U n d e r t h e p r e s e n t s c h e d u l e c a p a c i t y w i l l be r e a c h e d by 198/, . N o t o n l y a r e t h e r e p h y s i c a l l i m i t a t i o n s t o e x p a n s i o n , b u t p o l i t i c a l ones as w e l l . The c e n t r a l l o c a t i o n o f t h e f a c i l i -t i e s , i t s e a s y a c c e s s by t h e p u b l i c , and t h e a e s t h e t i c q u a l i t i e s have made i t t h e s u b j e c t o f t h e C i t y ' s r e d e v e l o p m e n t p l a n . D e v e l -opment o r e x p a n s i o n i n t h e a r e a by B.C.C.S.S. w o u l d be e f f e c t i v e l y p r e v e n t e d by C i t y C o u n c i l ' s w i t h h o l d i n g o f b u i l d i n g p e r m i t s . The c e n t r a l l o c a t i o n o f t h e f a c i l i t i e s a l s o p r e s e n t s o t h e r p r o b l e m s t o some t r u c k i n g c o m p a n i e s . T h e s e a r e m a i n l y i n t h e a r e a o f c o n v e n i e n c e and a c c e s s i b i l i t y . N o t o n l y i s t h e r e l i m i t e d a c c e s s t o t h e t e r m i n a l y a r d , r e s t r i c t e d t r u c k r o u t e s , b u t t r a v e l t h r o u g h downtown V a n c o u v e r i s d i f f i c u l t a nd t i m e c o n s u m i n g . L a r g e t r u c k s a l s o c o n t r i b u t e d i s p r o p o r t i o n a t e l y t o -noise,, and .con-g e s t i o n i n downtown. W i t h t h e s e c o n s i d e r a t i o n s B.C.C.S.S. have h a d t o c o n s i d e r r e l o c a t i o n o f f a c i l i t i e s as a means o f s o l v i n g some o f t h e s e p r o --127-b l e m s . One a l t e r n a t i v e u n d e r c o n s i d e r a t i o n i s t h e c o n s t r u c t i o n o f a n o t h e r f a c i l i t y a t a new l o c a t i o n , and d i v e r t i n g a p o r t i o n o f t h e d r o p t r a i l e r t r a f f i c t o i t f r o m downtown. The a n a l y s i s o f t h i s a l t e r n a t i v e f o u n d t h a t n o t o n l y d i d i t s o l v e many o f t h e p r o b l e m s w i t h t h e e x i s t i n g f a c i l i t y , b u t t h e n e t b e n e f i t s o f s u c h a p r o j e c t c o u l d be v e r y c o n s i d e r a b l e . 7.2 A r e a s f o r F u t u r e R e s e a r c h A number o f r e l a t e d t o p i c s h a v e a r i s e n as a r e s u l t o f t h e a n a l y s i s o f d r o p t r a i l e r t r a f f i c . T h e s e t o p i c s s h o u l d be g i v e n c a r e f u l c o n s i d e r a t i o n and e x a m i n a t i o n as t h e y a r e e x t r e m e l y i m p o r -t a n t t o t h e f u t u r e o f t h e M a i n l a n d - I s l a n d f e r r y s y s t e m . The B.C. F e r r y p o l i c i e s r e g a r d i n g c e r t a i n t r a f f i c move-ments s h o u l d be a n a l y s e d . T r a f f i c f a l l i n g i n t o t h i s c a t e g o r y w o u l d be o v e r h e i g h t v e h i c l e s s u c h as c o m m e r c i a l u n i t s and r e c r e a -t i o n a l t r a f f i c . T h e s e u n i t s i n t e r f e r e w i t h t h e l o a d i n g , u n l o a d i n g and c a p a c i t y o f t h e B.C. F e r r y f l e e t . The a n a l y s i s w o u l d be e v e n more i m p o r t a n t f r o m t h e s t a n d p o i n t o f B.C.C.S.S., g i v e n t h a t t h e new t r a i l e r f e r r y i s s c h e d u l e d t o go i n t o o p e r a t i o n i n 1976. A change i n B.C. F e r r y p o l i c y r e g a r d i n g d r o p t r a i l e r s w o u l d h ave a l a r g e i m p a c t on B.C.C.S.S.'s o p e r a t i o n s , e s p e c i a l l y i n v e s t m e n t p l a n s . A s e c o n d t o p i c o f i m p o r t a n c e w o u l d be a f e a s i b i l i t y s t u d y o f t r u c k i n g lumber from t h e I s l a n d t o t h e M a i n l a n d . The e x p e r i e n c e -128-o f Doman's T r a n s p o r t w o u l d s u g g e s t t h i s as a f e a s i b l e method o f m i t i g a t i n g t h e t w i n b a c k h a u l p r o b l e m s c u r r e n t l y e x p e r i e n c e d b y r a i l c a r s and d r o p t r a i l e r s . T h i s q u e s t i o n c o u l d b e p a r t o f a l a r g e r s t u d y d e a l i n g w i t h t h e r a i l - t r u c k c o m p e t i t i o n on t h e I s l a n d . The t r e n d o f v i e w i n g V a n c o u v e r as a d i s t r i b u t i o n c e n t e r f o r t h e I s l a n d , t h e l i m i t e d r a i l a c c e s s on t h e I s l a n d , t h e t i m e r e q u i r e d f o r t r a n s s h i p p i n g r a i l c a r s , and t h e f l e x i b i l i t y o f t r u c k s h a v e a l l c o n t r i b u t e d t o t h e g r o w t h an d i m p o r t a n c e o f d r o p t r a i l e r s . 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