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Character and pervasiveness of transport competition in the movement of commodities from Great Vancouver… Gray, John Sinclair 1969

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THE CHARACTER AND PERVASIVENESS OF TRANSPORT COMPETITION IN THE MOVEMENT OF COMMODITIES FROM GREATER VANCOUVER ORIGINS TO BRITISH COLUMBIA DESTINATIONS by JOHN SINCLAIR GRAY B.A. Sc., University of B r i t i s h Columbia, 1943 A THESIS SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION in the Faculty of COMMERCE AND BUSINESS ADMINISTRATION We accept this thesis as conforming to the required standard THE UNIVERSITY OF BRITISH G#LUMBIA A p r i l , 1969 In p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t o f t h e r e q u i r e m e n t s f o r an a d v a n c e d d e g r e e a t t h e U n i v e r s i t y o f B r i t i s h C o l u m b i a , I a g r e e t h a t t h e L i b r a r y s h a l l m a k e i t f r e e l y a v a i l a b l e f o r r e f e r e n c e a n d S t u d y . I f u r t h e r a g r e e t h a t p e r m i s s i o n f o r e x t e n s i v e c o p y i n g o f t h i s t h e s i s f o r s c h o l a r l y p u r p o s e s may b e g r a n t e d b y t h e Head o f my D e p a r t m e n t o r b y h i s r e p r e s e n t a t i v e s . I t i s u n d e r s t o o d t h a t c o p y i n g o r p u b l i c a t i o n o f t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l n o t b e a l l o w e d w i t h o u t my w r i t t e n . p e r m i s s i o n . D e p a r t m e n t o f Commerce and Business Administration The U n i v e r s i t y o f B r i t i s h C o l u m b i a V a n c o u v e r 8, C a n a d a ABSTRACT The transportation networks i n the province of B r i t i s h Columbia are described with reference to the general economic setting and the geographical and h i s t o r i c a l background. In turn, r a i l , water, and road transport networks are described with b r i e f mention of a i r and pipeline transport. The study of competition in the transportation industry is undertaken with the primary basis being a series of interviews with representatives of shippers, c a r r i e r s , government departments, and other organisations. The character and pervasiveness of competition between the modes of public freight transportation and of competition among carriers within those modes are discussed in some d e t a i l . Inter-modal competition i s examined in the l i g h t of half a dozen factors which influence the shipper's choice of mode. An approximate rank order of shipper's modal preference for these factors i s presented. Intra-modal competition is examined i n terms of a dozen factors which influence the shipper's choice of the part i c u l a r c a r r i e r , f i v e of these factors being common to the modal choice. The extent of private transportation systems within the province (mainly r a i l and road) i s described. The a n c i l l a r y modes, bus transporta-tion and mail are analyzed b r i e f l y . Observations and conclusions include a discussion of current trends i n the major modes, and the extent of monopolies and over-service, p a r t i c u l a r l y in the trucking industry. Comments are offered on the lev e l of sophistication i n the transportation industry i n the province and. the opportunities for a more intensive market-oriented approach. TABLE OF CONTENTS CHAPTER PAGE Abstract Table of Contents i L i s t of Tables iv L i s t of Appendices v L i s t of Maps v i L i s t of Abbreviations v i i Acknowledgements v i i i I. INTRODUCTION 1 1.1 Purpose of the Study 1 1.2 Economic Setting 1 1.3 Method of the Study 3 I I . STRUCTURE OF THE TRANSPORTATION NETWORKS IN BRITISH COLUMBIA 5 2.1 Geographical and H i s t o r i c a l Setting 5 2.2 R a i l Transportation 7 2.3 Water Transportation 11 2.4 Road Transportation 12 2.5 A i r Transportation 13 2.6 Pipeline Transportation 14 2.7 Extent of Choice of Mode and Carrier 15 I I I . COMPETITIVE FACTORS IN TRANSPORTATION 17 3.1 Intra-modal Competitive Factors 17 3.2 Inter-modal Competitive Factors 18 i i CHAPTER PAGE IV. INTER-MODAL COMPETITION IN BRITISH COLUMBIA 19 4.1 Inter-modal Competitive Factors: Rank Order of Shipper's Modal Preference 19 4.2 Time i n Transit 21 4.3 Freight Charges 23 4.4 Frequency of Service 26 4.5 Door-to-door Service 27 4.6 Loss and Degree of Damage 31 4.7 Res t r i c t i o n of Maximum Size and Weight 33 4.8 Competition Between R a i l and Road Transport ... 36 V. INTRA-MODAL COMPETITION IN BRITISH COLUMBIA 39 5.1 Time in Transit 39 5.2 Freight Charges 39 5.3 Door-to-door Service 41 5.4 Frequency of Service 41 5.5 Loss and Damage 41 5.6 On-time Performance 42 5.7 A v a i l a b i l i t y of Standard Equipment 43 5.8 A v a i l a b i l i t y of Special Equipment 44 5.9 Shipment Tracing 49 5.10 Promptness of Claims Settlement 49 5.11 Information Service 49 5.12 Competence of S o l i c i t o r s 50 i i i CHAPTER PAGE VI. PRIVATE TRANSPORTATION 51 VII. OTHER MODES 52 "VIII. OBSERVATIONS AND CONCLUSIONS 54 8.1 Adequacy of Competitive Factors Examined 54 8.2 Limitations of the Study 54 8.3 Modal Trends 55 8.4 Monopolies and Over-service 57 8.5 Level of Sophistication 58 8.6 Marketing Orientation 60 8.7 Existence of Vigorous Competition 61 FOOTNOTES 63 BIBLIOGRAPHY 65 APPENDIX 66 i v LIST OF TABLES TABLE PAGE 2.1 AERODROMES IN BRITISH COLUMBIA AND CANADA 14 2.2 REGIONS IN REGIONAL INDEX OF BRITISH COLUMBIA 15 3.1 INTRA-MODAL COMPETITIVE FACTORS 17 (Factors Considered by Shippers When Selecting Carriers) 4.1 INTER-MODAL COMPETITIVE FACTORS: RANK ORDER OF SHIPPER'S MODAL PREFERENCE 19 V LIST OF APPENDICES APPENDIX PAGE 1 TABLE OF ECONOMIC AREAS IN BRITISH COLUMBIA SHOWING NUMBER OF SCHEDULED CARRIERS ACTIVE IN EACH MODE OF TRANSPORT 66 v i LIST OF MAPS MAP PAGE 1 PRINCIPAL ROUTES OF RAIL TRANSPORT IN BRITISH COLUMBIA 69 2 PRINCIPAL ROUTES OF WATER TRANSPORT IN BRITISH COLUMBIA 70 3 PRINCIPAL ROUTES OF ROAD TRANSPORT IN BRITISH COLUMBIA 71 4 PRINCIPAL ROUTES OF AIR TRANSPORT IN BRITISH COLUMBIA 72 LIST OF ABBREVIATIONS Canadian National Railways Canadian P a c i f i c Railway Canadian P a c i f i c Transport Company P a c i f i c Great Eastern Railway Pounds per square inch gauge v i i i ACKNOWLEDGEMENT S The author is most' appreciative of the excellent cooperation of the numerous representatives of B r i t i s h Columbia shippers, c a r r i e r s , government departments, and other organisations i n scheduling and holding interviews and providing supplementary information which formed the basis of this thesis. He i s p a r t i c u l a r l y grateful for the patient advice and guidance of Dr. Harry L. Purdy, of the Faculty of Commerce and Business Administration, who acted as thesis chairman. CHAPTER I INTRODUCTION 1.1 Purpose of the Study B r i t i s h Columbia i s one of the richest provinces in Canada, primarily because of i t s abundant natural resources. These resources are of various kinds, and are widely distributed throughout the entire area of the province. Their development and extraction are highly dependent on transportation f a c i l i t i e s . This study w i l l examine the transportation networks as they now exist in the province, and w i l l focus attention on the competitive structure of the transportation industry. An answer w i l l be sought to the question "does vigorous inter-modal and intra-modal competition exist in the transportation of commodities from metropolitan Vancouver to out-lyi n g areas in B r i t i s h Columbia?" 1.2 Economic Setting Canada has an open economy, heavily dependent on exports and imports. Over about the past 15 years, Canadian exports have amounted to 20 to 25 percent of gross national product, and have been approximately equal to Canadian imports. In the United States, which i n absolute terms i s the greatest trading nation i n the world, exports and imports as proportions of gross national product have been much smaller: 5 to 6 percent for exports, and 4 to 5 percent for imports. 1 In Canada, export commodities are predominantly new materials or products of primary manufacture, and import commodities are predominantly products of secondary manufacture. - 2 -There is considerably less secondary manufacturing within Canada than i n other i n d u s t r i a l i s e d nations in the world of similar economic stature. B r i t i s h Columbia exhibits the same economic characteristics as Canada as a whole, but with even greater emphasis on production of raw materials and semi-finished products, and the low l e v e l of secondary manufacturing. The economy of B r i t i s h Columbia i s based primarily on the extractive i n d u s t r i e s — l o g g i n g , mining, petroleum, f i s h i n g , and agriculture. There is also a considerable amount of primary manufac-turing, notably i n the forest industry: lumber, plywood, pulp, and paper, and i n the food processing and packaging industry. Secondary manufacturing i s confined largely to producing various supplies to support the extrac-t i v e industries. Except for food, beverages, and some building materials, most consumer commodities are imported from other provinces i n Canada, from the United States, or from foreign sources. 2 B r i t i s h Columbia covers a large area (366,255 square miles ), but more than ha l f of the population of the province i s concentrated in a single area at the extreme south-west which covers less than half of one 3 percent of the area of the province. This area includes Vancouver, North Vancouver, West Vancouver, Burnaby, Richmond, Delta, and the Lower Fraser Valley east to Hope, and i s commonly known as the "Lower Mainland". The freight transportation networks i n B r i t i s h Columbia are heavily influenced by deep-sea t r a f f i c through the Port of Vancouver, handling much of the trade for a l l of western Canada. There is a substantial l e v e l of coastal shipping, both within pr o v i n c i a l waters and beyond the province to Alaska and the United States. Vancouver is a terminus for two trans-continental Canadian r a i l r o a d s , the C.N.R. and C.P.R., and North Vancouver is a terminus for a large provincial r a i l r o a d , the P.G.E. Vancouver is - 3 -on the Trans-Canada Highway and is a focal point for highways which cover most of the province. Vancouver has an international airport capable of handling the largest commercial a i r c r a f t f l y i n g today. The general economy of B r i t i s h Columbia requires extensive trans-portation f a c i l i t i e s to serve two basic functions: 1.2.1 the movement of construction materials, raw materials, operating supplies, and consumer goods to the areas of production 1.2.2 the movement of raw materials and semi-finished products to points of export from the province This study i s concerned to some extent with both functions, but mainly with the former. 1.3 Method of the Study The main source of information for this study was a series of interviews conducted by the author with shippers in the Lower Mainland area who make regular shipments throughout the province. The shippers selected did not constitute a random sample of a l l shippers, but instead were generally the larger and more successful manufacturers and d i s t r i -butors i n a wide variety of industries. As a group, the shippers i n t e r -viewed send shipments to v i r t u a l l y every population centre in B r i t i s h Columbia, use every available mode of transport, and handle many different commodities i n a wide range of weight, s i z e , and value. As a cross check on the v a l i d i t y of information obtained from shippers, interviews were also conducted with several c a r r i e r s , p a r t i c u l a r l y the railroads and the larger and more successful motor c a r r i e r s . Interviews were also held with representatives of other organisations concerned with the transpor-tation industry, including a publisher, a rate bureau, trade organisations, and o f f i c i a l s of the provincial government Department of Highways, Department of Commercial Transport, Department of Industrial Development, Trade, and Commerce, and the Public U t i l i t i e s Commission. CHAPTER I I STRUCTURE OF THE TRANSPORTATION NETWORKS IN BRITISH COLUMBIA 2.1 Geographical and H i s t o r i c a l Setting B r i t i s h Columbia i s the most westerly province in Canada, bounded, in general terms, on the south by the 49th p a r a l l e l and the United States; on the north by the 60th p a r a l l e l and the Yukon and North West T e r r i t o r i e s ; on the west by the P a c i f i c Ocean and the southern t i p of Alaska; on the east by the 120th meridian and the summit l i n e of the Rocky Mountains (intersecting at the 54th p a r a l l e l ) and the province of Alberta. B r i t i s h Columbia i s generally mountainous and has an extensive cover of coniferous forest. There are numerous ranges of mountains i n the province, mostly p a r a l l e l to the coastline and to each other. The Coast Range and the Rocky Mountains are c l e a r l y i d e n t i f i a b l e and extend from the United States to Alaska and the Yukon; other major ranges include the Columbia, Cassiar, Omineca, Stikin e , Skeena, Babine, Bulkley, Cariboo, P u r c e l l , Selkirk, Monashee, and Cascade. The province is r i c h i n mineral deposits and has large potential for development of hy d r o - e l e c t r i c i t y . F i f t y - e i g h t percent of the area of B r i t i s h Columbia is covered by 4 commercial forest with four d i s t i n c t regions: coast region, subalpine region, Columbia region, and mountain region. There are some pockets of a r c t i c and alpine tundra, p a r t i c u l a r l y in the northern part of the province and in the highest elevations i n the Coast Range and the Rocky Mountains. Only about 4 percent of the area of the province i s suitable for agriculture - 6 -and about half of this i s under c u l t i v a t i o n . A g r i c u l t u r a l crops include grain, f r u i t , berries, and vegetables. There are several areas of dairy farming and some f a i r l y large areas of c a t t l e ranching. There are generally three climatic regions:^ P a c i f i c , forming about 5 percent of the area of the province, along the coast, the warmest region with the average temperature i n the coldest month over 32°F, humid, with abundant r a i n f a l l , especially i n winter; South Mountain, almost one-t h i r d of the area of the province, generally in the south and south-east, warmer mountain, v a l l e y , and plateau country, with warm summers; and North Mountain, almost two-thirds of the area of the province, generally in the north and north-west, colder mountain, v a l l e y , and plateau country, with cl i m a t i c conditions varying more with a l t i t u d e than with l a t i t u d e . As a re s u l t of these geographical features, B r i t i s h Columbia today i s a rather sparsely settled area with population centres at isolated locations along the coast, on Vancouver Island, the Gulf Islands, and the Queen Charlotte Islands, and in numerous v a l l e y s , notably the Fraser River, the Columbia River, the Kootenay River, the Skeena River, the Peace River and the Okanagan Valley. Most of the population i s i n the southern h a l f of the province. The transportation networks i n B r i t i s h Columbia began with water transport. The e a r l i e s t recorded exploration of the coast of Alaska and northern B r i t i s h Columbia was made by the Russian, Vitus Bering, i n 1741, the year of his second great voyage. Spanish explorers sailed the coast, but there i s no record of landings. In 1778, Captain James Cook made several landings along the coast of B r i t i s h Columbia during his t h i r d great voyage. Cook's voyage marked the beginning of the fur trade in B r i t i s h Columbia. Captain George Vancouver, who had been one of Cook's o f f i c e r s , - 7 -spent three years exploring and mapping the coast, beginning i n 1792J The f i r s t overland exploration was made by Alexander MacKenzie, who arrived at Be l l a Coola i n 1793. Simon Fraser explored the r i v e r that bears his name during 1808. White settlement in B r i t i s h Columbia began in the early 1800's and was supported e n t i r e l y by water transport. Communities were estab-lished on the coast at V i c t o r i a , Nanaimo, New Westminster, and Vancouver. Land transport was limited to horseback and pack animals. The early pursuits were fur-trapping and logging. The North West Company and the Hudson's Bay Company opened trading posts for the fur trade and assisted in the exploration and development of the province. In 1849, Vancouver Island was made a B r i t i s h Crown Colony. In 1858, placer gold was discovered i n the sand bars of the Fraser River, pr e c i p i t a t i n g a massive gold rush. In 1858, the mainland was made a B r i t i s h Crown Colony, recognising the.49th p a r a l l e l as the southern boundary which had been established by the Oregon Treaty with the Americans g i n 1846. The two colonies were united in 1866. The l i m i t of navigation up the Fraser River was about 115 miles from the coast. Yale was established at th i s point and became the ter-minus of the fur brigade from the i n t e r i o r of the province, and a supply centre for the placer miners. Between 1861 and 1864, the monumental task of building the Cariboo Wagon Road was completed--extending from Yale through the Fraser Canyon and north to Soda Creek, a distance of more than 200 miles. 2.2 R a i l Transportation (See Map 1 for p r i n c i p a l present r a i l routes.) The Confederation of Canada under the B r i t i s h North America Act of - 8 -1867 did not include B r i t i s h Columbia, but i t did include Nova Scotia and New Brunswick who joined on the promise of construction of an Inter-c o l o n i a l Railway l i n k i n g Halifax with central Canada. This l i n k was completed i n 1876. Fear of annexation by the United States was the spur 9 that prompted Canadian Government agreement to an important condition of B r i t i s h Columbia's entry into Confederation i n 1871, namely that: The Government of the Dominion undertake to secure the commence-ment simultaneously, within two years from the date of the Union, of the construction of a railway from the P a c i f i c towards the Rocky Mountains, and from such point as may be selected, east of the Rocky Mountains, towards the P a c i f i c , to connect the seaboard of B r i t i s h Columbia with the railway system of Canada; and further, to secure the completion of such railway within ten years from the date of the Union. As part of a National Policy for economic development announced i n 1879, the Federal Government i n 1880 contracted with a syndicate, l a t e r known as the Canadian P a c i f i c Railway Company, to extend the trans-continental railway to the west coast. This l i n k was completed to tidewater at Port Moody (adjacent to Vancouver) i n 1885.^ In the 1890's, there was a great deal of railway construction a c t i v i t y i n Canada, including building of the Grand Trunk P a c i f i c Railway from Winnipeg to Edmonton and the P a c i f i c coast at Prince Rupert. The Canadian Northern Railway was authorised to continue i t s l i n e westerly from Edmonton to the P a c i f i c coast at Vancouver. Upon completion of this con-str u c t i o n , B r i t i s h Columbia had three major r a i l lines.'''''' Following a Railway Inquiry Commission i n 1916, the Canadian National Railway system was formed i n 1923, absorbing the Grand Trunk, the Canadian Northern, the Int e r c o l o n i a l , and a number of smaller bankrupt 1 mes. The C.N.R. today operates lines i n Newfoundland, and from Halifax - 9 -through Central Canada to Edmonton and Jasper, and enters B r i t i s h Columbia through the Yellowhead Pass. I t runs west to Red Pass Junction and then branches north and south. The north branch follows the Fraser River to Prince George and then runs along the Bulkley River and Skeena River to Prince Rupert. The south branch follows the North Thompson River to Kamloops, runs along the Thompson River to Lytton, and f i n a l l y along the Fraser River to Vancouver. The C.P.R. today operates lines from Halifax through central Canada to Calgary and Banff and enters B r i t i s h Columbia through the Kicking Horse Pass. I t runs to Golden, Revelstoke, and Kamloops, and then p a r a l l e l s the C.N.R. to Vancouver. Another major railway i n B r i t i s h Columbia i s the P a c i f i c Great Eastern. The P.G.E. was incorporated i n 1912 with private c a p i t a l and a pr o v i n c i a l charter to construct and operate a railway from Vancouver along Howe Sound and northeasterly to a junction with the Grand Trunk P a c i f i c 13 Railway at Prince George. Operation began from North Vancouver to Horseshoe Bay (11 miles) i n 1914. Construction was well under way on an extension from tidewater at Squamish to Quesnel (347 miles) when the railway went bankrupt. The provincial government had guaranteed the bonds and upon the bankruptcy became reluctant owners of the P.G.E. i n 1918. The extension to Quesnel was completed i n 1921. Track from North Vancouver to Horseshoe Bay was l i f t e d , but the railway continued to operate in an i n -different fashion from Squamish to Quesnel and became f a m i l i a r l y known as the railway that started nowhere and ended nowhere. Debts continued to p i l e up. However, i n 1949 an ambitious new phase in the development of the P.G.E. was launched, a phase characterised by new construction and - 10 -modernisation. The l i n e was extended from Quesnel to Prince George (81 miles, completed in 1952) connecting with the C.N.R. at Prince George. It was extended from Squamish to North Vancouver (40 miles, completed in 1956) connecting with the C.N.R., C.P.R., B.C. Hydro and Power Authority, and the Great Northern Railroad. Further extensions were made from Prince George to Chetwynd (193 miles) then forking to Fort St. John (69 miles) and to Dawson Creek (61 miles) ( a l l completed in 1958) . Next came the Mackenzie Trackage extension--to serve the south end of the Peace River Reservoir (23 miles, completed in 1966), and then the f i r s t part of the Takla Lake Extension (Odell to Fort St. James, 75 miles, completed in 1967). Planned extensions are Fort St. James to Takla Lake (73 miles) and Fort St. John to Fort Nelson (200 miles). These are now in the survey and location phase. The modernisation program has included conversion to diesel locomotives, use of self-propelled passenger cars, and i n s t a l l a t i o n of a microwave communication system with very high frequency radio dis-patching and reporting of tr a i n s . There are 36 i n d u s t r i a l railways in the province, with a t o t a l 14 mileage of main l i n e and sidings of about 364 miles. Most of these railways are in-plant for pulp m i l l s , smelters, chemical plants, and an explosives factory, and are very short. The largest system is operated by B r i t i s h Columbia Hydro and Power Authority with a network of lines in the Greater Vancouver area and extending to Huntingdon and Chilliwack; the to t a l length of track in this system is 112 miles. Canadian Forest Products Limited operates a 110 mile logging railway in i t s Nimpkish Valley d i v i s i o n , and Crown Zellerbach Canada Limited operates a 26 mile railway in i t s Ladysmith d i v i s i o n . - 11 -2.3 Water Transportation (See Map 2 for p r i n c i p a l present water routes) The oldest form of freight movement in B r i t i s h Columbia i s water transportation for both deep-sea vessels and coastal vessels. The e a r l i e s t vessels were s a i l i n g ships, followed by steamships and motor vessels. Van-couver i s now a major seaport with c a l l s by deep-sea vessels from a l l over the world, notably the United States, the Orient, A u s t r a l i a , and Europe. Large quantities of logs, lumber, plywood, pulp, paper and mine ore con-centrates are loaded for export at numerous other deep-sea ports along the coast of the province. Water transportation within the province i s largely i n the form of loads towed by tug-boats, these loads consisting of log booms and barges of various sizes and shapes to handle many different types of commodities. 15 Upwards of 700 tug-boats are in regular service on the coast with a barge f l e e t numbering between 1600 and 1700. P r a c t i c a l l y a l l of the bulk materials moving by water along the coast are carried by barges. Of the general cargo t r a f f i c , about 25 percent i s carried on barges, and the rest i n conventional vessels. The provincial government operates an extensive ferry service on the coast, the main runs being Tsawwassen Terminal (south of Vancouver) to Swartz Bay (on Vancouver Island), Horseshoe Bay to Nanaimo, Tsawwassen and Swartz Bay to the Gulf Islands, and Horseshoe Bay to Bowen Island and the Sechelt Penninsula. (The provincial government also operates numerous f e r r i e s across inland lakes and rivers as required along the routes of important highways.) During the summer months only, Canadian National Steamships provides ferry service from Vancouver to Prince Rupert and points i n Alaska. The prominent privately-owned water carriers are Canadian P a c i f i c Steamship, with ferry service from Vancouver to Nanaimo, - 12 -and r a i l - c a r barge service from Vancouver to Vancouver Island; Northland Navigation, operating four weekly routes from Vancouver to Vancouver Island and Prince Rupert; and Island Tug and Barge and Coast Ferries, both c a l l i n g at communities on and near northern Vancouver Island. 2.4 Road Transportation (See Map 3 for p r i n c i p a l present road routes.) The Cariboo Wagon Road was in use for more than twenty years before regular r a i l service was f i r s t established in B r i t i s h Columbia. There were other road routes i n the province, but horses and oxen were no match for the railway steam engines. For many years, long-haul inland freight t r a f f i c was very predominantly carried by r a i l . Road networks gradually grew up radiating from railway stations and coastal docks. Trucks driven by internal combustion engines appeared in small numbers i n the 1920's. The trucks were not very r e l i a b l e , they were low-powered, and they could carry only small loads on the bad roads. R a i l continued to hold the lion's share of freight t r a f f i c . Nevertheless, trucking gradually came to be recognised as the accepted mode of transport for l o c a l d i s t r i b u t i o n . As the trucks improved, the demand for roads increased and the road network was gradually extended. In recent years, there have been vast improvements i n the endurance, carrying capacity, and speed of road vehicles, as well as i n the extent and quality of the roads. Road transport has expanded accordingly. With the exception of two small areas where roads are now under construction (Alta Lake to L i l l o o e t , about 83 miles, along the P.G.E., and part of the route between McBride and Prince George, about 25 miles, along the C.N.R.), there are now v i r t u a l l y no locations i n the province served - 13 -by r a i l that are not also served by road. On the other hand, there are today many areas in B r i t i s h Columbia that are served by road but not by r a i l . 2.5 A i r Transportation (See Map 4 for p r i n c i p a l present a i r routes.) A i r transportation, of course, i s of recent o r i g i n . However, B r i t i s h Columbia, with d i f f i c u l t access to so many areas, has been pro-minent as the scene for many "bush-pilot" operations. The mountainous, forested areas are forbidding, but the abundant inland lakes and numerous stretches of sheltered coastal water have provided safe landing and take-o f f f a c i l i t i e s a l l over the province. Small a i r c r a f t have been widely used for carrying prospectors, surveyors, timber-cruisers, mechanics, hunters, and fishermen, and th e i r supplies, throughout the province. B r i t i s h Columbia has also many landing-fields. The t o t a l number of land and water aerodromes in the province is nearly 20 percent of a l l 16 the aerodromes i n Canada. Table 2.1 l i s t s aerodromes operated by the Federal Department of Transport, municipality, or private operators, both for B r i t i s h Columbia and for Canada. In spite of the large number of aerodromes i n the province, the volume of a i r freight i s not very large. Many of the aerodromes are quite small and are seldom used. Of the t o t a l of 298 i n B r i t i s h Columbia, at least 98 are operated by private individuals, ranches, or resorts (or by no one in p a r t i c u l a r ) , or are for emergency use only. Only 22 of the land aerodromes have a i r s t r i p s longer than one mile, and only 15 of these carry regularly scheduled t r a f f i c . While most of the water aerodromes have well over three miles of useable length, they are actually used by only f a i r l y small pontoon a i r c r a f t . - 14 -TABLE 2.1 AERODROMES IN BRITISH COLUMBIA AND CANADA Licenced Aerodromes Heliports Water Land Unlicenced Aerodromes Heliports Water Land M i l i t a r y Aerodromes Totals B r i t i s h Columbia Canada 12 34 64 385 44 342 5 8 52 244 119 494 2 57 298 1564 2.6 Pipeline Transportation Long distance pipelines are r e l a t i v e l y new to B r i t i s h Columbia and at present are limited to carriage of petroleum products. They transport a s i g n i f i c a n t proportion of the t o t a l ton-mileage of freight i n i n t e r - c i t y t r a f f i c , and therefore modify carriage by the other modes of transport. The i n t e r p r o v i n c i a l Trans Mountain O i l Pipe Line enters B r i t i s h Columbia through the Yellowhead Pass, and carries Alberta crude o i l and condensates to Vancouver and Washington State; i t also carries receipts of crude o i l and condensates from the provincial Western P a c i f i c Crude O i l and Products Pipeline originating i n the Fort St. John area. Westcoast Transmission carries natural gas from Fort Nelson and Fort St. John to the international boundary at Huntingdon, and supplies the Inland Natural Gas d i s t r i b u t i o n system (Kamlodps-Salmon Arm-Okanagan Valley-Trail-Nelson) and the B.C. - 15 -Hydro and Power Authority d i s t r i b u t i o n system, (Vancouver and the lower Fraser V a l l e y ) . The Alberta Natural Gas Transmission l i n e cuts across the south-east corner of the Province, carrying natural gas from Alberta to the United States, and supplying the l o c a l communities of Fernie, Cranbrook, Kimberley, Skookumchuck, and Creston. A l l of these pipeline systems have been completed since 1953. 2.7 Extent of Choice of Mode and Carrier The Bureau of Economics and S t a t i s t i c s of the provincial government Department of Industrial Development, Trade, and Commerce has developed a Regional Index of B r i t i s h Columbia. 1^ The province is divided into ten regions (similar to the census divisions used by the Dominion Bureau of S t a t i s t i c s ) as l i s t e d i n Table 2.2. TABLE 2.2 REGIONS IN REGIONAL INDEX OF BRITISH COLUMBIA Region Name 1 East Kootenay 2 West Kootenay 3 Okanagan-Similkameen-Boundary 4 Lower Mainland 5 Vancouver Island 6 Shuswap-Chilcotin 7 Lower Coast 8 Central Interior 9 North-Western 10 Peace River In the Index, the regions are subdivided into 78 areas, most of which correspond with school d i s t r i c t s . These 78 areas form a convenient struc-ture for examining economic a c t i v i t y in the province and also the trans-portation networks serving the province. Appendix I i s a table showing - 16 -the number of carriers within each mode operating between Greater Vancouver and each of the 78 economic areas. On examining this table, one is immediately struck by the large number of motor carriers active in Br i t i sh Columbia. CHAPTER I I I COMPETITIVE FACTORS IN TRANSPORTATION 3.1 Intra-Modal Competitive Factors In studies conducted by Canadian Transportation, twelve factors have been selected as having a bearing on the choice of carriers for i n d u s t r i a l 18 shipments in Canada. Assuming that the shipper makes a ra t i o n a l choice--and hence is not influenced by such factors as habit and personal friend-ships—these twelve factors appear to represent a reasonably complete framework for shipper decisions. A l o g i c a l extension is that each factor perhaps represents an area for competition among carriers seeking to gain the shipper's business. This l i s t of factors, shown i n Table 3.1, was adopted as a basis for examining intra-modal competition i n the transpor-tation industry in B r i t i s h Columbia. TABLE 3.1 INTRA-MODAL COMPETITIVE FACTORS (Factors Considered by Shippers When Selecting Carriers) Time in t r a n s i t On-time performance Freight charges Shipment tracing Frequency of service Door-to-door service A v a i l a b i l i t y of standard equipment Promptness of claims settlement Loss and degree of damage Information service Competence of s o l i c i t o r s A v a i l a b i l i t y of special equipment - 18 -While generally subject to government regulation, carriers within the modes are not regulated with respect to the quality of their services. Carriers have considerable freedom i n competition to attract and hold customers. 3 .2 Inter-Modal Competitive Factors In most cases, the choice of c a r r i e r i s preceded i n the shipper's mind by the choice of mode of transport. Some of the factors i n Table 3.1 are associated almost exclusively with selection of the c a r r i e r , but several of them have an important bearing on selection of the mode i t s e l f . For analysis of inter-modal competition in transportation in B r i t i s h Columbia one other factor i s an appropriate addition: r e s t r i c t i o n on maximum size and weight of shipments. This additional factor i s somewhat related to the factors " a v a i l a b i l i t y of standard equipment" and " a v a i l a b i l i t y of special equipment i n Table 3.1. The factors which appear to bear heavily on modal selection and the additional factor r e l a t i n g to size and weight are l i s t e d i n Table 4.1. In contrast to intra-modal competition there is considerably less freedom for competition among modes: the modes themselves are severely li m i t e d by their geographical deployment and by the i r respective levels of technology. CHAPTER IV INTER-MODAL COMPETITION IN BRITISH COLUMBIA 4.1 Inter-Modal Competitive Factors: Rank Order of Shipper's Modal Preference Table 4.1 l i s t s the selected inter-modal competitive factors and for each factor shows the commonly accepted rank order of shipper's pre-ference for the different modes of public commodity transport i n B r i t i s h Columb i a . TABLE 4.1 INTER-MODAL COMPETITIVE FACTORS: RANK ORDER OF SHIPPER'S MODAL PREFERENCE MODE OF TRANSPORT Time i n Transit Freight Charges Frequency of Service Door-to-door Service Loss and Degree of Damage Re s t r i c t i o n on Maximum Size and Weight WATER RAIL ROAD AIR 4 3 2 1 1 2 3 4 * 2 1 * 3 2 1 • * 3 3 2 1 1 2 3 4 *not a ch a r a c t e r i s t i c of the mode, per se The rank orders shown are somewhat generalised and require some f l e x i b i l i t y i n application, especially when a s p e c i f i c shipment involves more than one mode of transport. The main considerations supporting the rank orders shown in Table 4.1 - 20 -are as follows: 4.1.1 time in trans it--normal vehicle cruising speeds 4.1.2 freight charges—usual levels of costs to the carrier in providing service, assuming appropriate minimum route lengths and shipment sizes 4.1.3 frequency of service—usual loads on single vehicle assem-blies and usual levels of congestion (applying mainly to r a i l and road transport—water and air transport omitted from consideration) 4.1.4 door-to-door service—relative abundance of direct access to source and destination points (air transport omitted from consideration) 4.1.5 loss and degree of damage—historical records of actual performance for normal handling and records of incidence of accidents 4.1.6 res tr ic t ion on maximum size and weight--normal carrying capability of vehicles and travelled way, and obstructions encountered en route As demonstrated in Table 4.1, there is no single mode that has an obvious preference over the others, whenever an actual choice exists, selection must be based on a weighting of preference factors as they apply to a particular shipment. Such weighting is a subjective matter so that different individuals might easily make different selections under sub-stant ia l ly identical circumstances. The opportunity obviously exists to some degree for a carrier in any mode to equal or better whatever is offered by carriers in other modes—or at least to minimise differentials so that any preference becomes very weak. - 21 -4.2 Time i n Transit Time in t r a n s i t i s important to the shipper i n several different ways. I f the goods are high i n value, the impact of interest expense on the value of inventory en route favours a low time i n t r a n s i t ; none of the shippers interviewed regarded this as a s i g n i f i c a n t factor for their ship-ments. I f the goods are perishable, such as flowers, vegetables, f r u i t , meat, and f i s h , a low time in tr a n s i t i s important to avoid spoilage and to ensure an at t r a c t i v e appearance for the commodity i n the marketplace. While r e f r i g e r a t i o n i s h e l p f u l (and often essential in hot weather) rapid transportation was regarded by the shippers interviewed as the key factor. Time i n t r a n s i t i s important to shippers who are in a competitive industry where the customer requires fast service or has been conditioned to expect i t . F i n a l l y , time in t r a n s i t can be of c r i t i c a l importance when shipping materials (and personnel) essential to restore some process or operation to running order. Improvements in roads and road vehicles have led to considerable reductions i n time in t r a n s i t for road transport. Shorter t r a v e l l i n g time i s the most important single factor i n the growing competition between road and r a i l transport i n the province. While many locations are equipped with r a i l sidings, several r a i l interchanges may be necessary between source and destination. I t i s not uncommon for each interchange between railroads to require a f u l l day: a t y p i c a l shipment between two points i n the province might take eight hours by truck but three days by r a i l . Road transport i s s u f f i c i e n t l y fast that many suppliers serving the entire province operate only a single warehouse located in the Lower Mainland area and can offer substantially "next day" service to their customers. - 22 -Typically, Prince George (479 road miles from Vancouver) and main Okana-gan Valley points (251 to 321 road miles from Vancouver) are only over-night truck t r i p s from Vancouver. Shippers interviewed in the perishable food industries invariably used road transport because of reduced spoilage compared to r a i l transport. An example of a shipper offering fast service to customers is Woodward Stores who operate a chain of department stores in B r i t i s h Columbia and Alberta. In shipments from the base warehouse i n Vancouver to "Vancouver Downtown", West Vancouver (Park Royal), Surrey (Guildford), V i c t o r i a , Nanaimo, Port Alberni, Kamloops, and Prince George, Woodwards uses road transport (contract trucking) almost exclusively. While water transport i s much cheaper than road transport, i t is also much slower. As road f a c i l i t i e s expand to coastal centres in the province, general commodity t r a f f i c i s steadily s h i f t i n g from water trans-port to road t r a n s p o r t — f o r c i n g the water carriers to improve their per-formance to maintain their business. Emergency shipments are often sent by a i r . While a i r transport is an important segment of the t o t a l transportation network, only one t h i r d of the shippers interviewed made regular use of a i r f r e i g h t , and r e s t r i c t e d their use primarily to emergency shipment of supplies or replacement parts. An important user of a i r transport i s the Federal Post Office Department which sends f i r s t class mail by a i r whenever service is available that w i l l provide faster delivery than other means. Packages can also be sent by a i r mail. In a very few locations in northern Canada, a l l mail i s sent by a i r . The elapsed time that a shipment i s actually i n t r a n s i t i s not always c o n t r o l l i n g . The convenience of scheduled a r r i v a l and departure - 23 -times may lead the shipper to transfer shipments to a mode which i s poorer in terms of time i n t r a n s i t . 4.3 Freight Charges The mode generally offering lowest freight charges i s water transport. It i s widely used along the coast of B r i t i s h Columbia, but i n many cases there i s no p r a c t i c a l a lternative, especially to island locations such as the Gulf Islands, and the Queen Charlotte Islands. Because of the extremely rugged nature of most of the coastline and the hinterland, some population centres on the mainland at tidewater are as yet inaccessible by land and must be serviced by water transport, with a minor support by a i r transport. Such locations include Powell River (served by fer r y , and a combination of road and ferry) and Ocean F a l l s , both of which are sites of large pulp m i l l s . Prince Rupert i s an example of a tidewater location which i s served by a l l four public modes of transport. Considerable quantities of commodi-ti e s are shipped by water, r a i l , and road. Where freight charges are the main c r i t e r i o n , water transport gets the major share. For example, Prince Rupert ranks second among coastal ports in volume of petroleum products received by water. Freight charges tend to assume greatest significance with low-value commodities. A good example is beer, which travels by lowest charge routes. Water transport i s used for beer wherever possible, with r a i l as the next choice; road transport i s used only in special circumstances, and a i r i s never used for large shipments. For short runs or small size shipments, the rank order of modal preference for freight charges shown in Table 4.1 requires modification - 24 -because costs of loading and unloading, and costs of transferring between modes become c o n t r o l l i n g . For urban runs, road transport would almost certainly rank f i r s t rather than t h i r d , and for medium distance runs, perhaps up to 150 miles, road transport would rank after water but ahead of r a i l . For longer runs, freight charges become lower for r a i l than for road. One of the great advantages of r a i l transport over road l i e s i n the economy of labour; t y p i c a l l y fewer than ten men are required on a freight t r a i n carrying more freight than a hundred trucks, each of which requires at least one man. As a r u l e , for short distances, freight charges for r a i l are higher than for road. Freight charges generally increase with distance for both r a i l and road, but the rate of increase for r a i l i s somewhat lower. At some distance, therefore, the r a i l charge and the road charge become equal. The magnitude of this distance i s dependent on various factors, including type of commodity and size of shipment. I t i s not possible to state a s p e c i f i c distance for which freight charges i n B r i t i s h Columbia are equal for r a i l and road transport, but i t i s probably i n the v i c i n i t y of 150 miles. For any particular circumstances, the equal-charge distance i s subject to competitive adjustment of rates, but there i s l i t t l e oppor-tunity of significance i n B r i t i s h Columbia for such adjustment because of the way that the population centres happen to be situated. The major centre i n the province i s Greater Vancouver, and a l l communities i n the Lower Fraser Valley l i e within 100 miles, c l e a r l y favouring road transport for freight charges. The next closest communities of any appreciable size are more than 250 miles away from Vancouver, hence generally favouring r a i l transport for freight charges. S i m i l a r l y , on Vancouver Island, the majority of the population l i e s between Nanaimo and V i c t o r i a , which are - 25 -only 70 miles apart, while most of the population i n the northern part of Vancouver Island i s within 100 miles of Nanaimo. The t o t a l population i n Greater Vancouver, the lower Fraser Valley, and Vancouver Island amounts to 19 73 percent of the t o t a l population of the province. Eaton's operates a very large chain of department stores and mail order o f f i c e s across Canada, including 44 locations in B r i t i s h Columbia. Eaton's is an ideal example of a shipper who uses road transport through-out the Fraser Valley and Vancouver Island, and uses r a i l transport p r a c t i c a l l y everywhere else. (For the purpose of this study, trucks using ferry transport between Vancouver and Vancouver Island are assumed to constitute road transport.) This rule applies to 42 of the 44 locations, the only exceptions being Prince Rupert, which is supplied by water, and Williams Lake, which i s normally supplied by road. A few commodities are able to t r a v e l by r a i l in B r i t i s h Columbia to accept low freight charges because large volumes of uniform items are involved which can be stocked in branch warehouses. The costs of operating branch warehouses, less the savings i n warehouse costs at the base plus the r a i l freight charges must i n t o t a l be less than the t o t a l costs for the alternate choice of base warehousing alone plus the freight charges for smaller and more frequent shipments. Typical of such commodities are beer and paper wrapping materials for the f r u i t industry. There are about 25 beer warehouses in the province, and there i s one warehouse in Kelowna for paper wrapping materials used throughout the Okanagan Valley. Of the s i x inter-modal competitive factors l i s t e d in Table 4.1, freight charge i s the only one that can be manipulated without physical changes in the operation of any kind: i t i s , therefore, usually the f i r s t to be considered i n competitive a c t i v i t y . A perennial problem in maximising - 26 -profit for most transportation systems is the achievement of maximum net revenue for both head-haul and back-haul. In many situations, the carrier must be satisfied with a substantial unbalance in revenue, and may in fact earn a profit only on the head-haul. At worst, he may have an empty back-haul, so that any incremental net revenue that can be earned on back-haul is an improvement. The back-haul i s , therefore, commonly open to negotia-tion on price and frequently presents the opportunity for inter-modal competition in freight charges. When a carrier has a profitable head-haul but carries less than a f u l l allowable load, he can increase his profit i f additional loading is obtained for which the incremental revenue exceeds his incremental costs. This presents a second opportunity for inter-modal competition in price. Perhaps a form of freight charge competition is involved in the manner in which "weight" is determined for small shipments. In some cases, the shipper has no f a c i l i t i e s for weighing packages, and he simply estimates a weight which he marks on the b i l l of lading. The pick-up driver has no accurate means to check the weight, at least at the time of pick-up, and can rely only on how the package "feels" knowing roughly how much effort i t takes to move or l i f t a given weight. The natural tendency would be for the shipper to underestimate the weight, and there is probably a tendency to deal with carriers who w i l l not question the claimed weight. 4.4 Frequency of Service Frequency of service is necessarily a function of the total volume of freight moved, the size of normal loads carried by a single vehicle assembly, the number of competitive carriers on the route, and permissible levels of congestion. Rail transport is severely restricted in frequency - 27 -of service possible on single railway tracks that carry t r a f f i c in both directions with trains that might be upwards of 100 cars in length. In t h i s respect, road t r a f f i c i s much more f l e x i b l e . However, water, road, and a i r transport routes a l l have some limitations related to levels of congestion at the terminals and intermediate stops, and the routes them-selves . Frequency of service has an appeal to those shippers who operate a single plant or warehouse to serve a large area such as B r i t i s h Columbia. A l l modes of public transport in the province offer scheduled service, commonly da i l y for r a i l , road, and a i r c a r r i e r s . Water transport i s usually scheduled several times a day for the short ferry runs, but only once a week for the longer scheduled routes. Except for water transport, a c a r r i e r offering scheduled service i n the province must maintain his schedule i n a reasonable manner as a condition of holding his licence to operate. 4.5 Door-to-door Service There are several applications of "door-to-door service" i n water transport which are important to the economy of B r i t i s h Columbia, perhaps the best example being commercial f i s h i n g . Individual fishing-boats carry freshly-caught f i s h d i r e c t l y to canneries or freeze packers, or transfer them to f i s h packers who operate a shuttle service between the fi s h i n g grounds and the packing houses. The packing houses are invariably on tide water. Another example i s the logging industry in coastal regions. Logs cut in areas adjacent to the coast or large lakes are formed into booms and are towed d i r e c t l y to saw-mills which are located at the water's edge. Large quantities of pulp wood are taken d i r e c t l y to pulp m i l l s located on - 28 -tide-water. A substantial proportion of the production of packaged f i s h , lumber, pulp, and paper is exported d i r e c t l y from the point of production by deep-sea vessel. There are also several instances in the province of mining operations in which ore concentrates are loaded d i r e c t l y on deep-sea vessels. Hooker Chemicals has two manufacturing plants i n B r i t i s h Columbia, producing chlorine gas and caustic soda, mainly for use as bleaching chemicals in pulp m i l l s i n the province. The pulp m i l l s supplied by Hooker are a l l either on tide-water (with in-plant railways) or on r a i l sidings. The Hooker plant i n North Vancouver is located on tide-water and has a r a i l siding on the C.N.R. l i n e so that Hooker offers door-to-door service to a l l of i t s pulp m i l l customers. Hooker ships chlorine as a gas under pressure (about 175 PSIG) either by tanks on their own barge (the "Metlakatla", 900 tons chlorine capacity) or by r a i l car (usually 30 ton or 55 ton cars). The "Metlakatla" i s used to supply the pulp m i l l at Prince Rupert and r a i l car barges are used to supply Crofton, Duncan Bay, Port A l i c e , and Port Alberni. Kamloops is supplied by r a i l under a customer-negotiated agreed charge with C.N.R. based on receiving 100 percent of the chemical t r a f f i c and carrying pulp shipments on the return haul. Hooker ships caustic soda as an aqueous solution at atmospheric pressure. The usual concentration i s 50 percent but 73 percent i s now being used i n the United States because of transportation economics. Hooker i s contemplating using the higher concentration in B r i t i s h Columbia. While both caustic soda and chlorine are dangerous chemicals, the danger area for caustic soda is limited mainly to the l i q u i d s p i l l zone, but for chlorine is limited by the dispersion concentration of the (heavy) gas, - 29 -which could cover a large area. Chlorine gas in British Columbia is shipped in large quantities only by water and r a i l , but caustic soda is shipped by water, r a i l , and truck. The "Metlakatla" can carry 4,500 tons of caustic soda. Caustic soda is shipped in road tank trucks, with several road carriers sharing the business. Hooker Chemicals other plant is adjacent to the Harmac mill near Nanaimo. This Hooker plant supplies chemicals to Harmac by pipeline, and supplies caustic soda to Port Alberni by tank truck. Even i f shipper and consignee are located on r a i l sidings, r a i l transport is considerably hampered by the delays and costs of transfers between railways. Road transport is not restricted in this way and offers the great f l e x i b i l i t y of l i t e r a l service from door-to-door. Shipments within an urban area are almost universally carried by truck. When r a i l sidings at source and destination are not available, r a i l shipments require extra handling by pickup and delivery vehicles at source and destination. However, reduced handling when using truck transport is riot always a r e a l i t y . Small shipments are commonly picked up throughout the Lower Mainland area by light trucks and then taken to an assembly terminal for transfer to a larger vehicle; at destination the larger vehicle is "stripped" and individual deliveries are made by light truck. This procedure is more economical than taking a large truck t r a i l e r to a series of individual pick-up points, and in any case is often the only practical procedure because of the awkward maneuvering involved and con-gestion caused by a large t r a i l e r in urban areas. When individual shipments are large enough for a f u l l t r a i l e r load and there is reasonable access to the shipper's plant or' warehouse, i t is - 30 -common practice to leave t r a i l e r s on shippers premises for loading throughout the day for late afternoon or evening pick-up and overnight transport to a remote location. Such loading procedures are common i n the Lower Mainland for construction materials, "dry" groceries, and department store goods. Other commodities which are loaded by t r a i l e r d i r e c t l y at plants and warehouses in the Lower Mainland include reinforcing s t e e l , manufactured steel shapes, aluminum and copper shapes, and fabricated metal assemblies. The use of t r a i l e r " t r a i n s " provides some additional f l e x i b i l i t y in truck operation. Two h a l f - s i z e t r a i l e r s can be hauled instead of a single f u l l - s i z e t r a i l e r , and the h a l f - s i z e t r a i l e r s are faster to load and unload and much easier to handle as a single unit in urban areas. Long-haul truckers can drop off one t r a i l e r en route and pick up another in a very short time instead of delaying u n t i l a part load i s removed. Van-Kam Freightways i s an example of a B r i t i s h Columbia ca r r i e r who uses double-t r a i l e r t r a i n s . In the United States, a few trucking operators are hauling trains of three t r a i l e r s , but there are none as yet in B r i t i s h Columbia. Another practice which has achieved prominence in numerous countries i s the "piggy-back" service, or TOFC: t r a i l e r on f l a t car. Piggy-back i s used extensively in B r i t i s h Columbia by a l l the common c a r r i e r r a i l r o a d s . For example, P.G.E. t r a i l e r s load during the day at the Macdonalds Consoli-dated food warehouse complex in Burnaby for late afternoon pick-up and loading on r a i l f l a t cars in North Vancouver. T r a i l e r s ride piggy-back to Williams Lake, Quesnel, and Prince George where they are delivered by P.G.E. d i r e c t l y to Canada Safeway stores in the area. These t r a i l e r s carry various "dry" groceries packaged in cans, b o t t l e s , p l a s t i c containers, and cardboard boxes, such as f r u i t , vegetables, meat, f i s h , cereal, dehydrated products, - 31 -coffee, tea, soap, and other cleaning materials. 4.6 Loss and Degree of Damage Loss and degree of damage are normally regarded as lowest for a i r transport and next lowest for road transport. In the ranking for this factor as shown in Table 4.1, i t has been assumed that water transport and r a i l transport are about equal. Loss and degree of damage were not regarded as serious problems by the shippers interviewed. Loss through theft is not very common, partly because many of the commodities subject to theft are packed so that the i r i d e n t i t y is concealed, or are sealed in containers in such a way that a broken seal is obvious on cursory examination. Loss through misdirection i s an infrequent occurrence because of close attention given by shippers in marking shipment destinations c l e a r l y , and because of good design and careful handling of documents. Damage to goods in t r a n s i t has become less prevalent over the years, largely because of great improvements in packaging materials and packaging techniques, and because of improvements in materials handling equipment and stowing techniques. Corrugated cardboard and p l a s t i c foam are examples of very effe c t i v e packaging materials. P l a s t i c bottles are rapidly sup-planting glass b o t t l e s . U n i t i z i n g and p a l l e t i z i n g are effective techniques in stowing shipments. Many commodities are handled in individual pieces once in loading on a pa l l e t and then are not disturbed u n t i l unloading for display or actual use; the pa l l e t i t s e l f might pass through half a dozen vehicle transfers. "Keystone" loading on the pa l l e t i s used for bagged materials and boxed materials and reduces swaying of the load in t r a n s i t . Careful stowing and strapping in the tr a n s i t vehicle reduce damage to - 32 -packages from impact or rubbing contact with the vehicle or other packages. Improvements i n packaging and stowing have tended to reduce d i f -f e r e n t i a l preferences between different modes of transport with respect to damage. Improved technology has provided another technique for control of damage in shipment. A manufacturer of sanitary paper products in the Lower Mainland ships extensively by r a i l throughout the province. Again, damage to shipments i s not a serious problem, but does occur to a limited extent from time to time, especially with "non-core" products such as f a c i a l t i s s u e . (The "core" i n towelling, for example, imparts appreciable strength to packages and readily permits stacking several t i e r s in height.) A corrugated cardboard carton containing several individual packages of f a c i a l tissue can be undamaged on the outside, but have a l l the tissue crowded to one end inside the carton, rendering i t unsaleable. The experience of this Lower Mainland manufacturer i s that this type of damage has been more prevalent on some r a i l routes than on others. He has found i t very e f f e c t i v e to i n s t a l l impact recorders to travel with such ship-ments to obtain evidence for negotiation with the r a i l r o a d . Several shippers interviewed commented that an advantage of road transport over r a i l i s that the truck driver usually performs or supervises performance of the loading of his vehicle, and takes a personal interest in the load whereas a t r a i n crew does no more than make a quick inspection of the t r a i n . The truck driver is interested i n proper securing of the load for his own safety on the road, but experience has shown that he takes some personal pride in the proper protection of the loads, such as placing and securing tarpaulins or p l a s t i c covers to protect commodities - 33 -such as lumber, plywood, and building brick from r a i n , snow, mud, and i c e . Lenkurt E l e c t r i c Company of Canada is a manufacturer of electronic communications and control equipment, operating a large plant in Burnaby. This company undertakes many projects on a "supply and i n s t a l l " basis and frequently requires to ship electronic test equipment. Lenkurt makes a practice of shipping this equipment by a i r because experience has shown that the necessary delicate c a l i b r a t i o n adjustments are very l i t t l e d i s -turbed, i f at a l l , on a i r shipments. Aside from damage in normal t r a n s i t , the most severe damage occurs, of course, when the freight vehicle i s involved i n c o l l i s i o n , or leaves the t r a v e l l e d way. 4.7 R e s t r i c t i o n on Maximum Size and Weight The rank order in modal preference for r e s t r i c t i o n on maximum size and weight places water transport f i r s t because the barges in regular use along the coast of B r i t i s h Columbia can carry very much bulkier and heavier loads than are possible on any of the other modes. Two thousand ton capa-c i t y barges are i n common use and twenty-five hundred ton barges are not unusual. Depth of water at loading and unloading berths and along the route i s not normally a problem because the barges have such a shallow dra f t . Size of shipment i s , therefore, usually limited only by the capacity of the barge and overhead obstructions such as bridges. R a i l transport ranks second because obstructions are more severe than for water, but less stringent than for road transport. Individual r a i l car loads are r e s t r i c t e d i n size by the cars, the clearances from various obstructions including station platforms, rock faces along the travelled way, tunnels, bridges and passing t r a i n s . They are r e s t r i c t e d in weight by the - 34 -s t a b i l i t y of the road bed, the strength of the r a i l s , the strength of bridges and t r e s t l e s , and by the construction of the r a i l cars. Maximum size and weight of loads for highway transport are regulated by the provincial government and are physically limited by the vehicles them-selves, the strength of highway pavement and bridges, s t a b i l i t y of the road bed, by the dimension of the roadway, bridges, and tunnels and by passing t r a f f i c . On numerous stretches of highway i n B r i t i s h Columbia, a further l i m i t a t i o n i s reduced maximum permissible weight for varying periods in the spring of the year to avoid overloading bridges over streams and riv e r s during the spring freshet, and to avoid pavement damage when frozen sub-soil begins to thaw. Air transport is ranked last in the order of modal preference for re s t r i c t e d maximum size and weight because the maximum loads that can be carried are limited by the capacity of commercial a i r c r a f t and by the take-off and landing f a c i l i t i e s at aerodromes. P a c i f i c Western A i r l i n e s operates a Hercules a i r f r e i g h t e r on charter service in the province, and can carry quite large loads, but in general, a i r c r a f t loads are much smaller than loads that can be carried by road vehicles. In recent years, B r i t i s h Columbia has been the scene of a number of large construction projects, notably water storage dams, hydro-electric generating stations, e l e c t r i c a l transmission l i n e s , pipelines, highways, metal reduction plants, and pulp m i l l s . These projects have required that considerable quantities of construction materials, construction machinery, and plant machinery be transported to the job s i t e s . Because shipments were often bulky and heavy, freight charges and r e s t r i c t i o n on - 35 -maximum size and weight were both matters of importance. In Table 4.1, i t w i l l be noted that the rank order of modal preference for both factors i s water transport f i r s t , followed by r a i l , and then by road, and this constituted the main basis for modal selection for these large projects. Where non-reducible loads in excess of normal highway r e s t r i c t i o n s are required at i n d u s t r i a l plants not served by r a i l , special arrange-ments can often be made for road haul. While the normal maximum allowable gross vehicle weight in the province is 76,000 lb s . , single loads exceeding 250,000 lbs. have been carried on provincial highways. Delivery of heavy mechanical and e l e c t r i c a l equipment for a large construction project (such as a hydro-electric generating plant) is usually scheduled over a period of several months, or even years. The time in t r a n s i t , therefore, has l i t t l e r e a l significance and would normally not be a basis for selection of mode. The construction program usually has some "slack" for adjustment of the i n s t a l l a t i o n schedule. If materials to be shipped are operating supplies which are consumed at a regular rate (such as chemicals in a pulp m i l l ) then the net economic difference between a slow moving delivery system and a faster one i s simply the savings i n freight charges less the interest expense on the additional materials tied up i n t r a n s i t by the slower system. In many instances, some of the engineering design c r i t e r i a for maximum dimensions of plant machinery and construction machinery used on these large projects were based on the r e s t r i c t i o n on maximum size and weight imposed by the most favourable mode of transport available. On large jobs, manufacturers have negotiated transportation charges with carriers as a basic for preparing bids. The P.G.E. has carried steel storage vessels as large as 18 feet in diameter. These were special - 36 -shipments that required special scheduling to eliminate a l l passing t r a f f i c . Large ore-body trucks used on the Mica Dam project were too large to tr a v e l by highway: they were 15 feet wide and 12 feet high o v e r a l l . After factory t e s t s , the trucks were dismantled into sub-assemblies and shipped by C.P.R. to rail-head where they were re-assembled and driven to the dam s i t e . Each truck required three f u l l r a i l f l a t - c a r loads of sub-assemblies. 4.8 Competition Between R a i l and Road Transport It i s evident that the main inter-modal competition in B r i t i s h Columbia i s between r a i l and road transport. Improvements i n the extent and quality of urban and provincial road systems and improvements i n the design of road vehicles have contributed i n B r i t i s h Columbia, as elsewhere, to the rapid growth of road transport with r a i l transport holding sub-s t a n t i a l l y a constant volume but a declining share i n the expanding trans-portation market. The railway companies have responded to this r i s i n g competition i n three ways: 4.8.1 By r e s t r i c t i n g services offered --C.N.R. and C.P.R. are participants in Express Transport Association T a r i f f 100 (ETA 100) which accepts shipments of a l l sizes from 5 lbs. and larger. C.N.R. provides this service in B r i t i s h Columbia by r a i l supple-mented by road vehicles at both source and destination. (C.N.R. Express competes with i t s wholly-owned subsidiary Chapman Transport). C.P.R. does not apply ETA 100 i n B r i t i s h Columbia but instead carries small shipments by truck (via C.P.T.) Rates for LCL (less than carload l o t ) are provided i n Canadian Freight C l a s s i f i c a t i o n T a r i f f No. 22 but they are not applied i n B r i t i s h Columbia either by C.N.R. or C.P.R. Both C.N.R. and C.P.R. concentrate on f u l l carload l o t s . Both - 37 -railroads bring bulk commodities and manufactured goods to Vancouver from the p r a i r i e s and eastern Canada, mainly as exports, and have a return haul of bulk materials and manufactured goods, some of them being imports. P.G.E. is faced with a different t r a f f i c pattern, largely with bulk materials t r a v e l l i n g southbound to Vancouver for export and other t r a f f i c consisting mainly of bulk materials t r a v e l l i n g to m i l l s at Quesnel and Prince George from locations north of North Vancouver, and locations south of the northern termini. According to t r a f f i c s t a t i s t i c s for 1968, less than 16 percent of P.G.E.'s t o t a l t r a f f i c originates in North Van-couver (for northbound movement). As a consequence, P.G.E. has a large proportion of northbound empty cars, and encourages less than carload l o t t r a f f i c from Greater Vancouver o r i g i n s . 4.8.2 By entering the trucking business — C.N.R. operates Chapman Transport, serving the Cariboo, Kamloops, Revelstoke, and the entire Okanagan Valley. C.P.R. operates Canadian P a c i f i c Transport Company (formerly Canadian P a c i f i c Merchandise Service) serving p r a c t i c a l l y the whole province. 4.8.3 By employing new technology --C.P.R. has been a pioneer in applying computer technology to the transportation industry, and has developed quite sophisticated management information systems. The railroads have made wide-spread use of piggy-back carriage, and are now beginning to use large containers designed for" repeated interchange between water, r a i l , and road transport. The piggy-back system admirably combines the advantage of trucking i n providing door-to-door service (needing only a single loading and unloading of the t r a i l e r ) with the advantage of r a i l i n providing low-cost long-distance hauling. Piggy-back t r a f f i c i s increasing steadily, and C.N.R., C.P.R., - 38 -and P.G.E. a l l report that piggy-back revenue in B r i t i s h Columbia i s of the order of four percent of t o t a l revenue. This proportion applies generally to the rest of Canada and to the United States. I t should be noted that piggy-back charges are b a s i c a l l y under control of the railroads and so need to be only marginally below long-haul road costs to be at t r a c t i v e to truckers. The railroads use piggy-back service extensively to haul th e i r own highway t r a i l e r s . While operating only partly in B r i t i s h Columbia, the White Pass and Yukon Corporation operates an impressive integrated system of ships, trucks, and r a i l cars, carrying largely containerized goods between Vancouver and way points i n the Yukon (using water transport between North Vancouver and Skagway). CHAPTER V INTRA-MODAL COMPETITION IN BRITISH COLUMBIA Many of the comments in the previous chapter on the fi v e competi-t i v e factors under consideration that are common to inter-modal and i n t r a -modal competition have equal application to those factors i n th i s chapter. However, some additional comments on these factors w i l l be introduced. 5.1 Time in Transit A c a r r i e r can reduce his time in tr a n s i t by careful scheduling, by avoiding congestion, by selecting an advantageous route, and by using faster vehicles. The 1970's w i l l probably see the advent of turbine-powered trucks that w i l l reduce t r a n s i t time, especially on the many routes in B r i t i s h Columbia that have long, steady climbs. 5.2 Freight Charges When questioned about selection of a carr i e r on the basis of freight charges, most shippers said that there was very l i t t l e to choose. R a i l rates by alternate railroads to the same destination are v i r t u a l l y i d e n t i c a l but an interchange at a remote point for furtherance would lead to higher costs. For example, rates from Vancouver to Prince George are similar v i a P.G.E. and C.N.R., but rates from Vancouver to Vanderhoof (and other points further west on the C.N.R. line) are lower by C.N.R. than by P.G.E. because of the interchange at Prince George. Most of the 78 economic areas in the province (see Appendix I) served by r a i l are served only by one r a i l r o a d , and therefore no intra-modal choice e x i s t s . In those locations where a choice does e x i s t , selection i s usually made on the basis of the route offering the - 40 -minimum number of interchanges because of lower time in tran s i t and expectation of lower damage. For example, a shipment of beer from a Vancouver brewery might have the choice of a B.C. Hydro-C.P.R.-P.G.E.-C.N.R. routing to a C.N.R. siding i n Prince George (P.G.E. from North Vancouver to Prince George), or of a B.C. Hydro-C.P.R.-C.N.R. routing (C.N.R. from Vancouver to Prince George). Since i t i s common for a single interchange to require a f u l l day, the obvious preference would be the C.N.R. routing, ceteris paribus. The larger B r i t i s h Columbia companies often make i t a practice to s p l i t their business between competing railraods and competing trucking companies so that more than one ca r r i e r w i l l be accustomed to the shipper's requirements, and the shipper w i l l not be dependent on a single source. Some large national companies s p l i t t h e i r business equally between the two trans-continental r a i l r o a d s . Many of the trucking companies are participants in common freight 20 rate t a r i f f s , such as B r i t i s h Columbia Freight T a r i f f No. 20 governing scheduled and non-scheduled services between the Vancouver area and Kootenays—Okanagan Valley—Cariboo, west of Prince George to Prince Rupert, east of Cache Creek to Golden including Mica, north of Kamloops to McBridge and Yellowhead, and between points situated in these areas. This T a r i f f specifies maximum rates, and i t appears that most carriers actually charge the maximum rates. As already mentioned, charges for back-haul may be negotiated, and one shipper said that such charges are commonly one-half to two-thirds of the maximum rate. Some carriers obviously s o l i c i t back-haul business by offering quite low rates, and showing a d i s t i n c t preference for large single loads. A few shippers suggested that some carriers "probably" give a rebate on freight charges - 41 -to customers who have consistent large shipments. 5.3 Door-to-door Service This factor i s primarily a matter of inter-modal choice. 5.4 Frequency of Service A c a r r i e r might be able to attract and hold a customer by offering a more frequent service than his competitors. However, there is a growing concern, p a r t i c u l a r l y i n the trucking industry, about the high cost of handling small shipments, and the need to increase minimum charges. One way to mitigate this problem would be to reduce the frequency of service, but most carriers would be reluctant to take this step. While the truckers complain about the problem of the small shipment some of them actually contribute to the problem by making the rounds of potential customers on an "anything for me?" basis. 5.5 Loss and Damage Shippers handling commodities that are subject to theft usually take par t i c u l a r care to select r e l i a b l e c a r r i e r s . An example is Western wholesale Drugs which warehouses and ships from Vancouver v i r t u a l l y every a r t i c l e carried in a l l of the 82 Cunningham Drug Stores and 65 Western Drug Stores in B r i t i s h Columbia. T h i r t y - f i v e thousand items are handled (sixty thousand, counting size variations) ranging from candy and cos-metics to cameras and codeine. A l l shipments are handled by carriers who have been employed steadily for at least ten years, and some for upwards of t h i r t y years. A general comment among the shippers interviewed was that carriers of intermediate and smaller size take more care with shipments than do the - 42 -large c a r r i e r s . 5.6 On-time Performance On-time performance has regard for both time of pick-up and time of delivery, and i s of concern to both consignor and consignee. The s i g -nificance of this factor l i e s i n the potential upset to planning and the consequences of the ca r r i e r being early or late at either end of the t r i p . Interconnections with other carriers may be upset; there may be serious consequences at the ultimate destination i f a shipment i s l a t e . A shipment of bulky goods or of a large volume of packages obstructs the warehouse operation and w i l l usually be scheduled for assembly (or dispersal) at the loading dock to co-ordinate with the carrier's promised time of departure (or a r r i v a l ) . The problem of greatest concern mentioned by the shippers interviewed was the matter of requiring to pay workers overtime or to bring i n a special s h i f t whenever a car r i e r is l a t e . Many labour union contracts today require four hours minimum pay i f a worker i s called to a job outside of his normal hours of work. I f loading or unloading the shipment requires special equipment to be brought i n , a r r i v a l other than on-time can involve substantial extra costs. The shippers admitted that a car r i e r i s often held up on his schedule because some shipper has neglected to inform the ca r r i e r of an unusually bulky or heavy shipment. Of course, when the ca r r i e r i s l a t e , i t may well be for a reason beyond his control, such as severe weather conditions, or a rock-slide blocking the travelled way. A vehicle may be late because of mechanical breakdown, but the stronger carriers operate standby equip-ment which can pick up shipments from a disabled vehicle and attempt to maintain the schedule. One shipper said that this was an important - 43 -consideration i n his selection of a c a r r i e r . A modern aid to maintaining on-time performance i s radio d i s -patching, which i s now quite widely used, especially in urban areas. An example of a shipper who demands very s t r i c t adherance to on-time performance is the Vancouver Sun newspaper. This newspaper publishes s i x days a week, and has three-regular editions, each with s l i g h t l y d i f -ferent news content: 5.6.1 three-star, "country e d i t i o n " , issued at 10:30 a.m., for Vancouver street sales and the Fraser Valley. 5.6.2 four-star, "home ed i t i o n " , issued at 1:45 p.m., for home delivery i n Greater Vancouver and shipment to the Sechelt Penninsula north to Powell River. 5.6.3 Buff, " f i n a l e d i t i o n " , issued at 3:30 p.m. for Vancouver street sales, and shipment to Vancouver Island and the in t e r i o r of the province. Most of the newspaper d i s t r i b u t i o n to sub-stations i s made by small independent truckers who have handled the same job e f f e c t i v e l y for more than t h i r t y years. Various individual runs are scheduled for departure throughout the morning and afternoon. On-time performance probably makes the greatest single contribution to what a shipper regards as "dependability" i n a c a r r i e r . 5.7 A v a i l a b i l i t y of Standard Equipment A v a i l a b i l i t y of standard equipment on a day-to-day basis can be a factor i n selecting a c a r r i e r . For example, a building materials supplier may wish to load a r a i l car tomorrow say for Prince George and be i n d i f -ferent whether i t travels by C.N.R. or P.G.E. The ca r r i e r who can provide - 44 -a car on the shippers siding at e a r l i e s t convenience w i l l be the one selected. For any number of "rush" shipments, the floor shipper w i l l s t a r t to c a l l h is customary carriers u n t i l he finds one who can give immediate service. 5.8 A v a i l a b i l i t y of Special Equipment The shippers interviewed indicated that very often the a v a i l a b i l i t y of special equipment i s the determining factor i n selecting a pa r t i c u l a r c a r r i e r . Special equipment i s required to handle loads of awkward size and weight, loads of bulk materials, and loads that require special environment. Double-deck highway transporters for automobiles are widely used throughout the province for d i s t r i b u t i o n of automobiles manufactured off-shore. Canadian Auto Carriers handles the bulk of these shipments with some carrying by Melchins (to the Kootenays) and Stagliano. Automobiles from B r i t a i n , France, Germany, and Japan are commonly unloaded at deep-sea docks i n Vancouver d i r e c t l y onto the transporters for shipment to dealers or to temporary storage in l o c a l outdoor l o t s . The double-deck trans-porters are designed for quick loading and unloading at way points. They are used to some extent in B r i t i s h Columbia to carry trade-in vehicles from the dealer to a more favourable marketing location. Triple-deck r a i l transporters for automobiles have v i r t u a l l y supplanted highway transport for long-distance hauling of Canadian-built and American-built automobiles. One.large shipper of automobiles stated that automobiles transported by r a i l are subject to more damage than by (paved) road-flying gravel from the r a i l bed causes dents and chipped paint on the body as well as broken windows, and smoke from diesel locomotive exhausts causes discolouration and deterioration of paint. - 45 -Certain heavy loads such as steel plate, manufactured steel shapes, and fabricated steel require sturdy vehicles. While the plant or warehouse at o r i g i n usually has t r a v e l l i n g overhead cranes, i t i s often necessary to provide cranes at destination. Arrow Transfer and Johnston Terminals operate special equipment for loading and unloading as well as for road transportation of such loads. A number of carriers specialize in operating f l a t deck t r a i l e r s for carrying construction machinery such as bull-dozers, front-end loaders, and back-hoes. Liquid bulk materials such as petroleum products are carried in B r i t i s h Columbia by coastal tankers, tank barges, tank r a i l cars, and tank trucks. Coastal tankers are usually privately-owned, and tank r a i l cars are commonly owned or leased by the shipper for h i s exclusive use. There are several publicly-operated tank barges which have f l a t decks for general cargo with tanks beneath the deck for carrying l i q u i d loads of the order of 100,000 gallons. Several carriers compete for highway tank truck loads, including Tri-Mac, Rempel T r a i l Transport, Tank Truck Service, and Mid-West Tankers. A disadvantage of tank truck hauling i s that bulk l i q u i d t r a f f i c tends to be only one way. Several types of tank t r a i l e r s have been specially designed to haul bulk liquids i n one d i r e c t i o n and other freight i n the return dir e c t i o n and are used i n B r i t i s h Columbia. One t r a i l e r design i s es s e n t i a l l y a tank on wheels with the tank having a wide f l a t top so that i t "doubles" as a flat-deck t r a i l e r . Another design uses a narrow tank with straight v e r t i c a l sides and provides two to three feet width of f l a t deck along both sides of the t r a i l e r . A new t r a i l e r design has three, compartments—the fore and aft compartments designed for bulk l i q u i d s , and the centre compartment ruggedly constructed and designed for mine ore. - 46 -Bethlehem Copper i s a shipper currently using this type of t r a i l e r . Refrigerated t r a i l e r s are used for transportation of fresh meat, f i s h , and vegetables, p a r t i c u l a r l y for the longer runs i n hot weather such as from Vancouver to points in the Okanagan Valley. Fresh meat is commonly kept i n packing house coolers at 33 F to 38 F. Adequate control of tem-perature i s necessary to prevent spoilage and to maintain a t t r a c t i v e appearance. For many runs during the year, fresh meat i s carried in t r a i l e r s which do not have mechanically-driven r e f r i g e r a t i o n plants, but in which the packages and the voids have been "spray-blasted" with frozen carbon dioxide. Carcasses are packed in "stockinettes" that help to main-t a i n shape, and cut meats are wrapped in paper and packed i n corrugated cardboard boxes. With this handling technique, the residual c h i l l from the packing house cooler i s normally retained u n t i l the meat i s transferred to the consignee. A new technique being used i n truck t r a i l e r s carrying fresh vegetables from C a l i f o r n i a to Vancouver i s to maintain a nitrogen-r i c h (oxygen-poor) atmosphere which retards spoilage, especially of leaf vegetables. This technique i s not yet in use for d i s t r i b u t i o n shipments out of the Lower Mainland or for shipments from vegetable growing centres in the province. An example of special transport equipment re l a t i n g closely to operation of the shipper's plant i s found i n Lenkurt E l e c t r i c . Lenkurt frequently supplies from i t s Burnaby plant p r a c t i c a l l y a l l of the electronic assemblies for a complete radio communications network, consisting of a series of substantially similar fixed stations located perhaps 30 to 40 miles apart. The customary procedure has been to make a factory run of one or more assemblies which are then shipped to a gathering warehouse near the construction s i t e s , followed by factory runs of other assemblies which - 47 -are also shipped to the gathering warehouse. The i n s t a l l a t i o n team then draws assemblies from this warehouse to begin f i e l d construction. In many instances, f i e l d construction begins before factory runs are complete. While this procedure may be e f f i c i e n t i n factory production, i t tends to be quite i n e f f i c i e n t i n the i n s t a l l a t i o n phase. Lenkurt has just started an experimental i n s t a l l a t i o n in which the entire equipment for one or more stations i s loaded i n a van for delivery to or near the i n s t a l l a t i o n s i t e . The van being used is a special " a i r r i d e " van which i s supplied by United Van Lines and uses a pneumatic suspension system. For these experimental shipments, the electronic components are not packed i n boxes or crated but are i n s t a l l e d in their customary nine foot high operating racks which are mounted securely in the van.in thei r normal v e r t i c a l posi-t i o n . This procedure can provide several economies, notably in savings i n time for dismantling after factory tests, packaging time and materials, and unpacking and reassembly time at the job s i t e . The major economy w i l l be in i n s t a l l a t i o n time because an entire station can be completed in one session without repeated call-backs to a gathering warehouse. Success, of course, i s completely dependent on absence of damage during t r a n s i t , but tests elsewhere in similar " a i r r i d e " vans have indicated that good results can be expected. During interviews with shippers, two new concepts of special equipment were mentioned that provide carriers with opportunities to compete for business. One concept is the "fishy-back" barge which i s designed to handle truck t r a i l e r s for water shipment. The same advantages apply as for r a i l piggy-back, service. The other concept is the "skin-back" t r a i l e r . The conventional t r a i l e r simply backs up to a loading door and loads or unloads from the back. In the "skin-back" design, the t r a i l e r - 48 -cover can s l i d e i n channels along each s i d e of the deck. A f t e r the t r a c t o r backs the t r a i l e r i n t o a dock, the cover-release mechanism i s operated and the t r a c t o r d r i v e s forward, p u l l i n g the cover completely c l e a r of the deck. Loading (or unloading) can then proceed from both sides and overhead as w e l l as from the back. This design o f f e r s some important advantages i n quick loading and unloading, and i n p l a c i n g loads f o r favour-able d i s t r i b u t i o n of weight. A major advantage i s i n gai n i n g access to p a r t i c u l a r f r e i g h t without f i r s t r e q u i r i n g to unload other f r e i g h t . When a conventional t r a i l e r i s scheduled to make m u l t i p l e stops, loading i s u s u a l l y c a r e f u l l y planned so that f r e i g h t i s placed i n the t r a i l e r i n reverse order to the order of stops: f r e i g h t f o r the f i n a l stop i s loaded f i r s t , and f o r the i n i t i a l stop i s loaded l a s t . This p a t t e r n can be d i s t u r b e d when f r e i g h t f o r some d e s t i n a t i o n i s r e c e i v e d a f t e r f r e i g h t f o r l a t e r d e s t i n a t i o n s has already been loaded, or when a d e s t i n a t i o n must be by-passed f o r any reason, or simply when e r r o r s are made i n l o a d i n g . This access problem would almost disappear when u s i n g a "skin-back" t r a i l e r . This i s a new design, and there may be some t e c h n i c a l problems i n the design of the cover and the s e a l between the cover and the deck, but these problems can be s o l v e d . A more serious problem i s that loading docks must be redesigned to take f u l l advantage of the skin-back design. The t r a i l e r should be able to back completely i n s i d e the warehouse so that the deck w i l l be f l u s h w i t h the loading p l a t f o r m at both sides and the back, and the t r a c t o r must have s u f f i c i e n t f r e e space to move forward f o r f u l l r e t r a c t i o n of the cover. - 49 -5.9 Shipment Tracing Shipment tracing i s needed when shipments are lost through theft, misdirection, or accident, in order to allocate r e s p o n s i b i l i t y for the loss . Good performance i n tracing a shipment i s primarily a matter of developing an adequate procedure using effective documentation, and ensuring that everyone concerned follows the procedure correctly. No doubt some carriers become lax on occasion and find i t impossible to trace a lost shipment, but none of the shippers interviewed considered this to be a serious problem. The incidence of lost shipments tends to vary inversely with the size of the shipment and d i r e c t l y with the range of sizes of shipments t r a v e l l i n g together. The Post Office Department, which handles a large volume of small packages, has a remarkably good performance in absence of losses. 5.10 Promptness of Claims Settlement Promptness of claims settlement by carriers was not mentioned by any shipper interviewed as being a serious problem. Ale r t organisations are aware of the administrative costs to both the shipper and the ca r r i e r involved in prolonged wrangling over a claim--such costs can easily exceed the transportation revenue, or even the f u l l value of the merchandise. Several of the shippers mentioned the importance to them of dealing only with f i n a n c i a l l y sound carriers who are able to guarantee loss and damage claims. One c a r r i e r who has a monopoly on a part i c u l a r route was said to have a policy of completely ignoring a l l claims! 5.11 Information Service Information service from most carriers i s apparently adequate, and there were no complaints on this factor among the shippers interviewed. - 50 -It should be noted that the routes of public modes of transport in B r i t i s h Columbia are quite straightforward with r e l a t i v e l y l i t t l e opportunity for interchange, and also that the consolidation i n rate t a r i f f s has markedly s i m p l i f i e d the rate structure. T a r i f f s s t i l l appear to be unduly compli-cated, but shippers are readily able to obtain copies of at least certain rate t a r i f f s which they can study at l e i s u r e . As carriers grow in s i z e , information service becomes more routinised and normally i s quick and accurate. 5.12 Competence of S o l i c i t o r s Comments made by shippers during interviews indicated that the commonly accepted rank order of preference among modes for competence of s o l i c i t o r s would be a i r transport f i r s t , followed by r a i l and then by road. Very few comments were made about s o l i c i t o r s for water transport, and i t could only be assumed that s o l i c i t a t i o n for water transport i s not exten-sive. Water transport has been omitted from the rank order. However, the degree of preference was not very strong, and the impression gained was that the impact of s o l i c i t a t i o n i s seldom a determining factor in the choice of mode. S o l i c i t o r s for the large a i r l i n e s are mainly concerned with national and international markets and do not devote much attention to t r a f f i c within B r i t i s h Columbia. However, there are about t h i r t y a i r charter services in the province, and i t can be expected that they are generally competent. Several of the shippers interviewed commented that there has been a marked improvement i n the calib r e of sales a c t i v i t y by the railroads over the past f i v e years. Sales contacts have changed from the " c o f f e e - c a l l " s t y l e which had been cha r a c t e r i s t i c for many years, and are now made by - 50A -so l ic i tors who have obviously had some thorough sales training, who are concerned with the image of the ra i l road , and have a good grasp of what they are s e l l ing . As a ru le , so l ic i tors for the trucking companies are ex-drivers. While ex-drivers no doubt know a good deal about physical handling of shipments, they are not necessarily effective in se l l ing . One shipper interviewed said that while so l ic i tors for trucking companies were very pleasant and very w i l l ing , they were total ly ignorant of his rather special needs; another shipper commented that they were "a sorry lot". CHAPTER VI PRIVATE TRANSPORTATION There are many organisations i n B r i t i s h Columbia that operate private freight transportation f a c i l i t i e s , but most of these are in urban road transport. Private f a c i l i t i e s in other modes are of minor s i g n i f i -cance and mostly for carrying personnel. There are some i n d u s t r i a l railways used i n logging and mining operations, including the two logging systems mentioned i n section 2.2.above ( t o t a l l i n g 136 miles of track) and two short lines of Cominco i n the Trail-Kimberley area t o t a l l i n g 13 miles. Private road transportation f a l l s into three main groups: 6.1 trucking used by the extractive industries, notably logging and mining 6.2 urban trucking, composed or multitudinous pick-up and delivery vehicles for consumer goods, raw materials, finished goods, and for the many service industries 6.3 long-haul trucking for d i s t r i b u t i o n service Trucking i n the logging and mining industries i s a large subject, which i s beyond the scope of this study. No aggregate s t a t i s t i c s are kept on urban freight movement by private and public means, but the t o t a l a c t i v i t y i s very substantial and Private r a i l f a c i l i t i e s are generally being replaced by trucking both because many new areas of production are almost inaccessible by r a i l due to steep grades, and because of great technical improvement i n trucks. - 51A-i n terms of ton-mileage i n B r i t i s h Columbia, probably exceeds the i n t e r -c i t y f r e i g h t movement. Many of the o r g a n i s a t i o n s that operate t h e i r own v e h i c l e s supply only a small f r a c t i o n of t h e i r own needs and supplement t h e i r f l e e t w i t h p u b l i c f r e i g h t t r a n s p o r t a t i o n f a c i l i t i e s . A few of the shippers i n t e r -viewed use t h e i r own trucks f o r part of t h e i r t r a n s p o r t a t i o n needs. Such shippers i n c l u d e the breweries, the major department s t o r e s , meat packers, e l e c t r i c a l manufacturers, petroleum r e f i n e r s , and s u p p l i e r s of drugs, d a i r y products, bakery products, i n d u s t r i a l s u p p l i e s , and c o n s t r u c t i o n machinery. Some shippers c o n t r a c t a l l of t h e i r requirements to a t r u c k i n g company; f o r example, Simpsons-Sears has a l l of i t s domestic d e l i v e r y handled by Johnston Terminals. The only long-haul p r i v a t e t r u c k e r i n d i s t r i b u t i o n s e r v i c e i s Macdonalds Consolidated, supplying Canada Safeway stores throughout the province from i t s food warehouse complex i n Burnaby. Macdonalds operates 65 t r a i l e r s (with a f l e e t of about 40 t r a c t o r s ) but r e s t r i c t s i t s h a u l i n g to Greater Vancouver and to routes i n the province where there i s a worthwhile back-haul. For example, i t s p r i v a t e f l e e t hauls to Safeway stor e s i n the Okanagan V a l l e y , and back-hauls vegetables, f r u i t , f r u i t j u i c e s , and output from t h e i r own cannery at Summerland; i t a l s o operates throughout the Fraser V a l l e y , w i t h a back-haul of vegetables, b e r r i e s , and f r u i t . As a p r i v a t e operator, back-haul, of course, i s l i m i t e d to goods f o r d i s t r i b u t i o n only through Canada Safeway s t o r e s . Other areas such as the east Kootenays and the Cariboo do not provide the opportunity f o r back-h a u l , and Macdonalds Consolidated s u p p l i e s these areas through p u b l i c c a r r i e r s . Safeway stores i n the Dawson Creek-Fort S t . John area are s u p p l i e d from northern A l b e r t a , and the F e r n i e area i s s u p p l i e d from Calgary. CHAPTER VII OTHER MODES Two other modes of freight transport that have a recognised place in B r i t i s h Columbia are scheduled bus service and mail service. Many o f the shippers interviewed use both of these modes extensively for small shipments. Bus shipment usually requires packages to be delivered d i r e c t l y to a terminal or to the bus driver at a scheduled stop, and be picked up at a terminal or from the driver at a scheduled stop. However, bus service i s sometimes the most convenient method ov e r a l l of handling a small ship-ment—because of frequent service and reasonable charges — and both taxicab and pick-up and delivery services are commonly used to relay packages to and from the bus. Mail service, of course, i s a complete transportation system i n i t s e l f . I t offers short time in t r a n s i t , r e l a t i v e l y low charges (which can be paid by stamps or postage meter without the necessity of seeing a Post Office employee), widely placed pick-up points, delivery direct to the consignee at p r a c t i c a l l y any location, frequent pick-up schedules and delivery schedules, and very good performance in terms of loss and damage. In short, for shipments of reasonable size (and subject to certain res-t r i c t i o n s ) , mail represents the most complete service offered by any transportation agency. The Post Office Department i t s e l f i s a large user of transportation f a c i l i t i e s , and takes pa r t i c u l a r care in maintaining schedules. Arrange-ments with freight carriers to handle mail are usually made after careful - 53 -analysis of p u b l i c l y - c a l l e d tenders has been made by the Post Office Department and recommendations have been r a t i f i e d (normally for four-year periods) by Federal Treasury Board minutes. Mail is carried extensively by truck rather than by r a i l because of more favourable scheduling, faster t r a n s i t , and the f l e x i b i l i t y of door-to-door service. With some minor exceptions, trucks that carry mail are required to carry mail exclusively. F i r s t class mail i s carried by a i r (in Canada) whenever th i s w i l l r esult i n faster delivery than by other modes. Steps taken recently by the Federal Government to control costs and increase revenue i n the Post Office Department w i l l r e s u l t in somewhat curt a i l e d service and higher postage charges--which w i l l lead to some changes i n shipment patterns for small packages in B r i t i s h Columbia. CHAPTER VIII OBSERVATIONS AND CONCLUSIONS 8.1 Adequacy of Competitive Factors Examined The s i x inter-modal competitive factors in Table 4.1 and the twelve intra-modal competitive factors in Table 3.1 have been used in this study as the basis for examining the structure of competition i n the B r i t i s h Columbia freight transportation industry. These factors have been found to be quite adequate for the purpose; there were no relevant comments made by any of the persons interviewed that could not be considered under one or more of these selected factors. 8.2 Limitations of the Study Although more than forty interviews were held, the greatest l i m i -t a t i on i n this study has been the r e l a t i v e l y small size of the interview sample out of the t o t a l population of shippers and carriers active i n the province. However, the segment of the t o t a l freight market within the province represented by the shippers interviewed constitutes the segment for which there is strongest competition among modes and among c a r r i e r s . For reasonable convenience, interviews were held only in V i c t o r i a and the Lower Mainland. This resulted in another l i m i t a t i o n because many of the shippers interviewed make shipments on an f.o.b. plant or f.o.b. warehouse basis and the choice of mode and car r i e r i s made by the purchaser. However, in many of these instances the actual choice i s strongly influenced by the shippers and by the a c t i v i t i e s of the carriers who are headquartered in the Lower Mainland. - 55 -8.3 Modal Trends Raw materials used in primary manufacture in B r i t i s h Columbia are transported to manufacturing centres largely by water and r a i l . Construc-tion materials, operating supplies and consumer goods in large measure originate in the Lower Mainland or are imported and funnel through Vancouver to outlying points; carriage is made by a l l available modes of transport. A large proportion of the raw materials and semi-finished products consumed within the province or exported are shipped d i r e c t l y from the point of production, not passing through Vancouver. However, a s i g n i f i c a n t quantity of this t r a f f i c i s carried to Vancouver for onward shipment, again mainly outbound by deep-sea vessel and r a i l . These general shipping patterns constitute the framework within which the various transportation modes operate. The economy of the province is expanding, and as a consequence the volume of goods transported is also expanding. Also, in some instances, the length of haul i s i n -creasing because primary manufacturers have consumed available supplies which are close to their plants and must now reach further into the hinterland. With an expanding economy and developing technology, there is considerable room for competitive a c t i v i t y to modify the share of the market taken by individual modes (and by carriers within those modes). The evidence i s that a l l modes are expanding i n B r i t i s h Columbia, but at different rates and in different a c t i v i t i e s . A very noticeable feature of the operation of a l l modes is that the t r a f f i c i s largely one-way. In many instances, return t r a f f i c available i s i n s i g n i f i c a n t . Even empty containers are normally returned free of charge. One - 56 -d i f f i c u l t problem i s that transportation vehicles are often unsuitable to carry whatever back-haul t r a f f i c does happen to be available, but this problem is being met at least in some degree i n every mode by imaginative design of multi-purpose vehicles. Water t r a f f i c is growing i n carriage of bulk materials, but shrinking i n carriage of general commodities, losing mainly to road t r a f f i c . The development of "fishy-back" service can be expected to win back some of the t r a f f i c already lost to trucking. Extensive c a p i t a l expenditures are being made to expand and modernise the coastal f l e e t of tow-boats and barges. R a i l t r a f f i c i s growing, primarily in handling carload l o t s . C.N.R. and C.P.R. appear to be concentrating on improving eff i c i e n c y and promoting integrated services with trucking and other a f f i l i a t e d f a c i l i t i e s , but the P.G.E. i s heavily engaged in extending i t s lines to reach untapped natural resources i n the province, p a r t i c u l a r l y in the north. Road t r a f f i c is growing much more rapidly than water or r a i l , and the high growth rate can be expected to continue as the highway system expands and as vehicle designs improve. The trucking industry i n the province i s characterised by a large number of small operators with a few large ones. There i s a noticeable trend towards larger size of individual operators, and frequent mergers and acquisitions can be expected. Undoub-tedly some of the private companies w i l l "go public". There appears to be a hardening of freight charges, p a r t i c u l a r l y as labour costs r i s e , and there is a trend towards issuing common rate t a r i f f s with a number of par t i c i p a t i n g operators. The speed and f l e x i b i l i t y of trucking continue to be i t s strong points. While the growth rate of a i r freight within B r i t i s h Columbia is - 57 -possibly the highest of a l l modes, the high cost of operating a i r c r a f t and lim i t a t i o n s due to weather conditions and a v a i l a b i l i t y of suitable aerodromes preclude any heavy impact on handling bulk materials. 8.4 Monopolies and Over-service There are very few instances of monopoly operations i n the transportation industry in B r i t i s h Columbia. Almost a l l of the 78 economic areas have a choice of modes and a choice of carriers within the modes (see Appendix I ) . There are a number of areas served by only one r a i l r o a d , but they are generally served also by highway. , A few of the coastal areas are served v i r t u a l l y only by water, but there are competitive c a r r i e r s . The only monopolies worthy of note are water trans-port by Northland Navigation to small centres along the west and east coast of Vancouver Island; road transport by Squamish Transfer from Vancouver to the Squamish area; and road transport by Pender Harbour-Powell River Transport (and i t s recently acquired subsidiaries) from Vancouver to the Sechelt penninsula. The volume of t r a f f i c carried by Northland Navigation to i t s smaller points of c a l l is too small to warrant additional c a r r i e r s , and even this t r a f f i c i s f a l l i n g because of competition by road carriers as the road network grows. Some complaints were made by the shippers interviewed about the quality of service offered by the two road monopoly operators, but again the volume of t r a f f i c i s not large. Shippers made several references to the recent expansion of truck service between Vancouver and V i c t o r i a . Johnston Terminals had acquired two resident V i c t o r i a c a r r i e r s , Heaney Cartage and Storage, and Bray's Transfer, so that the number of competing operators was reduced. Service was offered by several other c a r r i e r s , including - 58 -Doman-Marpole Transport, Canadian National Transportation, Canadian P a c i f i c Transport Company, Arrow Transfer Company, and Commercial Truck Company. An application by the Victoria-based c a r r i e r Capital Freight-ways to r e c l a s s i f y i t s licence from food items only to general freight was opposed by the other carriers mentioned above, but was strongly supported by shippers on the basis of expected superior quality of service. The 22 application was approved during the 1966-1967 provincial f i s c a l year and shippers interviewed claimed with conviction that the superior quality was d e f i n i t e l y being provided by Capital. There is some degree of over-service i n the trucking industry. In thei r zeal to provide good service and win customers, the truckers give more frequent service than necessary, and there are simply too many trucks t r a v e l l i n g the routes only partly loaded. This i s p a r t i c u l a r l y true in urban areas, but here the shippers must share the blame because of their widespread tendency to regard small shipments as urgent regardless of actual need. As the trucking industry gains sophistication in i t s costing techniques, and as consolidation of trucking operators proceeds, this over-service can be expected to f a l l . Except for the p a r a l l e l r a i l service by C.N.R. and C.P.R. between Vancouver and Kamloops, over-service does not appear to be a problem i n modes other than road transport. The recent re-alignment of a i r l i n e schedules i n B r i t i s h Columbia by Canadian P a c i f i c A i r l i n e s and P a c i f i c Western A i r l i n e s i s a forward step i n streamlining service and improving ef f i c i e n c y for both companies. 8.5 Level of Sophistication ^ In step with the general trends towards better a n a l y t i c a l techniques in business and towards professional methods in management, the - 59 -transportation industry i n B r i t i s h Columbia is becoming more sophisticated. Probably the leaders among the modes are r a i l and a i r transport. Carriers in the tow-boat industry and the trucking industry are largely family businesses that have been developed by vehicle operators who have become businessmen by learning business and management techniques on the job. The trucking industry i n the province is widely regarded as being under-financed and perennially short of working c a p i t a l . There is room for considerable improvement in accounting techniques that w i l l show managers more c l e a r l y how their costs are distributed and consequently where improvements can be made. There is also a need for more uniformity i n accounting procedures to assist in comparisons between c a r r i e r s , and between a selected c a r r i e r and the industry aggregate. Electronic computers have many excellent applications i n the transportation industry. They are widely used by the railroads and major a i r l i n e s , but with one or two exceptions they are just beginning to be used by trucking companies in the province. There are numerous opportunities for economies i n the general f i e l d of materials handling. There have been great improvements in pack-aging of commodities that enable extensive use of u n i t i z i n g and p a l l e t i -zing techniques. However, employment of these techniques is limited to some extent by handling f a c i l i t i e s both at source and at destination. Many truck pick-ups and deliveries are made at premises that do not have platforms at the l e v e l of the truck deck to f a c i l i t a t e transfer of packages. Some trucks are equipped with hydraulically-operated t a i l gates which are very e f f e c t i v e , but limited to smaller packages. Packages must often be man-handled and so must be limited in size and weight. F o r k - l i f t - 60 -trucks are used extensively by the larger warehouses, but they are too expensive for the smaller premises. Low-cost hand-operated p a l l e t l i f t e r s are available, but not widely used. An area that appears to offer good potential i s expansion of the use of medium-size containers—say 40 to 60 cubic feet i n volume, and preferably c o l l a p s i b l e for empty return. Several shippers interviewed already use such containers, and enjoy the benefits of faster stowing, reduced handling, fewer breakages and losses and lower freight charges, but i t appears that much wider use could be made. 8.6 Marketing Orientation In many comtemporary industries, there i s a decided trend in operating companies towards re-alignment of company policy and extensive re-organisation for the company to become "marketing-oriented". Kotler 23 defines marketing as "the analyzing, organizing, planning, and controlling of the firm's customer-impinging resources, p o l i c i e s , and a c t i v i t i e s with a view to s a t i s f y i n g the needs and wants of chosen customer groups at a p r o f i t . " This trend i s not a l t r u i s t i c but undertaken as an opportunity to better exploit the market and to improve p r o f i t s . The trend towards marketing orientation i s most obvious among companies producing tangible products but the principles are the same for companies in the service industries. Marketing orientation can be seen i n the r a i l r o a d industry but i s v i r t u a l l y non-existent i n the trucking industry i n B r i t i s h Columbia. There are some s i g n i f i c a n t opportunities here for competitive a c t i v i t y . Since the C.N.R. and C.P.R. have aggressively entered the trucking industry, and since they both have a f f i l i a t e d a i r transport and water transport f a c i l i t i e s , they are promoting the concept of an integrated - 61 -all-mode transportation service dealing with a single agency. An example of an application of this concept by C.P.R. is the supply of petroleum products from a refinery i n Calgary to the construction s i t e for the Mica Dam. Products are carried by r a i l tank cars from Calgary to Revelstoke where C.P.R. operates a transfer plant with necessary tankage. Then C.P.T. (the trucking arm of C.P.R.) loads tank trucks at Revelstoke and delivers to a bulk plant operated by the o i l company at the construction s i t e . A r a i l t a r i f f i s published from Calgary through to Mica Dam. An example of C.N.R.'s "Cargo-Flo" concept i s the transportation of Portland cement by a combination of r a i l car and road vehicle. The Portland cement i s transferred from the r a i l car to the truck using special blowers. The Peace River area of B r i t i s h Columbia has t r a d i t i o n a l l y been supplied from Alberta centres such as Edmonton and Grande P r a i r i e . The Northern Alberta Railway and Highway 2 both extend from Edmonton through Grande P r a i r i e and on to Dawson Creek i n the Peace River area. Since completion of the P.G.E. extension to Dawson Creek and Fort St. John i n 1958, the P.G.E. has energetically s o l i c i t e d t r a f f i c for this area, with considerable success. 8.7 Existence of Vigorous Competition The public freight transportation industry i n B r i t i s h Columbia has a long history of development. The transportation networks are both cause and effect of economic a c t i v i t y and have evolved through competitive interaction. The modal shares i n the transportation market are strongly influenced by technology and geography. There is ample evidence of competitive - 62 -act iv i ty in every mode seeking to improve its absolute level of p a r t i c i -pation in the market i f not its modal share. Capital investment continues in every mode in the province and there is steady progress in the develop-ment of new vehicles and materials handling equipment. The railroads operate as an oligopoly, modified by individual geographic advantage. In the other modes, there are relat ively large numbers of competitors, part icularly in the trucking segment of the industry. With generally r i s ing costs and a growing awareness of the need for eff ic ient operation, intra-modal competition is becoming more sharply defined, and w i l l modify as the number of competitors is reduced through a continuing program of acquisitions and mergers. With particular reference to the transport of commodities from Greater Vancouver origins to Br i t i sh Columbia destinations, the evidence examined in this study reveals that competition is healthy and vigorous and w i l l undoubtedly grow in intensity. - 63 -FOOTNOTES National Industrial Conference Board, "The ABC of GNP", The  Canadian Economy: Selected Readings, Edited by John J. Deutsch, Burton S. Keirstead, K a r i L e v i t t , and Robert M. W i l l , (revised e d i t i o n ; Toronto: The Macmillan Company of Canada Limited, 1965), pp. 48-49. 2 Province of B r i t i s h Columbia Bureau of Economics and S t a t i s t i c s , Manual of Resources and Development--British Columbia, (V i c t o r i a : Queen's Prin t e r , 1967), p. 1. 3 Province of B r i t i s h Columbia Bureau of Economics and S t a t i s t i c s , Regional Index of B r i t i s h Columbia, (Vi c t o r i a : Queen's Printer, January, 1966), p. v. 4 Canadian Imperial Bank of Commerce, " B r i t i s h Columbia", Commercial  Letter, (Toronto; May-June, 1966) \he Canadian Oxford Desk Atlas of the World, (Toronto: Oxford University Press, 1957). The Reader's Digest Great World A t l a s , (Montreal: The Reader's Digest Association (Canada) Limited, 1962). ^Province of B r i t i s h Columbia Bureau of Economics and S t a t i s t i c s , Manual of Resources and Development--British Columbia, (V i c t o r i a : Queen's Pri n t e r , 1967) 8 Ibid. 9 Canada Dominion Bureau of S t a t i s t i c s , Canada One Hundred 1867-1967, (Ottawa: Queen's Printer, 1967), p. 207. 1 0 I b i d . , p. 208. 1 1 I b i d . , p. 210. 1 2 I b i d . , p. 210. 13 "Now, F u l l Steam Ahead to Resource-Rich In t e r i o r " , The Financial  Post, Vol. LXIII, No. 8, (February 22, 1969), pp. 37-38. 14 Province of B r i t i s h Columbia Department of Commercial Transport, Annual Report, 1967, (V i c t o r i a : Queen's Pri n t e r , 1968), p. GG25. - 64 -''""'"B.C. Tugboat Operators Expect Another Good Year", The Globe and  Mail Report on Business, February 20, 1969, p. B9. "^Canada Surveys and Mapping Branch, Canadian Aerodrome Directory, (Ottawa: Queen's Printer, A p r i l , 1968). "^Province of B r i t i s h Columbia Bureau of Economics and S t a t i s t i c s , Regional Index of B r i t i s h Columbia, (V i c t o r i a : Queen's Printer, January, 1966) . 18 Research Bureau, Carrier and Equipment Preference Study of  Canadian Industrial Shippers, (Toronto: Southam Business Publications Limited, A p r i l , 1968), p. 3. 19 Province of B r i t i s h Columbia Bureau of Economics and S t a t i s t i c s , " S t a t i s t i c a l Supplement to the Regional Index of B r i t i s h Columbia", (V i c t o r i a : Department of Industrial Development, Trade, and Commerce, January, 1968) (Mimeographed). 20 B r i t i s h Columbia Freight T a r i f f No. 20, issued by H.H. Williamson* Agent, (Burnaby, B.C., f i r s t issued November 7, 1967 and subject to continuous revis ion). 21 Province of B r i t i s h Columbia Department of Commercial Transport, Annual Report, 1967, (V i c t o r i a : Queen's Pri n t e r , 1968), p. GG25. 22 Province of B r i t i s h Columbia Public U t i l i t i e s Commission, Annual  Report on Motor Carriers, 1966-1967, (V i c t o r i a : Queen's Pri n t e r , 1967), pp. 12-13. 23 P h i l i p Kotler, Marketing Management: Analysis, Planning, and  Control, (Englewood C l i f f s , New Jersey: Prentice-Hall, Inc., 1967), p. 12. - 65 -BIBLIOGRAPHY Canada, Dominion Bureau of S t a t i s t i c s . Canada one Hundred 1867-1967. Ottawa: Queen's Pr i n t e r , 1967. Canada, Surveys and Mapping Branch, Department of Energy, Mines and Resources. Canadian Aerodrome Directory. Ottawa: Queen's Printer, A p r i l , 1968. Canadian Imperial Bank of Commerce. " B r i t i s h Columbia", Commercial Letter. Toronto, May-June, 1966. Kotler, P h i l i p . Marketing Management: Analysis, Planning, and Control. Englewood C l i f f s , New Jersey: Prentice-Hall, Inc., 1967. National Industrial Conference Board. "The ABC of GNP", The Canadian  Economy: Selected Readings. Edited by John J. Deutsch, Burton S. Keirstead, K a r i L e v i t t , and Robert M. W i l l . Revised editio n . Toronto: The Macmillan Company of Canada Limited, 1965. Province of B r i t i s h Columbia, Bureau.of Economics and S t a t i s t i c s , Department of Industrial Development, Trade, and Commerce. Manual of Resources  and Development--British Columbia. V i c t o r i a : Queen's Printer, 1967. . Regional Index of B r i t i s h Columbia. V i c t o r i a : Queen's Prin t e r , January, 1966. . " S t a t i s t i c a l Supplement to the Regional Index of B r i t i s h Columbia". V i c t o r i a : Department of Industrial Development, Trade, and Commerce, January, 1968. (Mimeographed). Province of B r i t i s h Columbia Department of Commercial Transport. Annual  Report, 1967. V i c t o r i a : Queen's Printer, 1968. Province of B r i t i s h Columbia Public U t i l i t i e s Commission. Annual Report on  Motor Carriers, 1966-1967. V i c t o r i a : Queen's Pri n t e r , 1967. Research Bureau, Southam Business Publications Limited. Carrier and Equipment Preference Study of Canadian Industrial Shippers. Toronto: Southam Business Publications Limited, A p r i l , 1968. The Canadian Oxford Desk Atlas of the World. Toronto: Oxford University Press, 1957. The Financial Post. Vol. LXIII, No. 8, February 22, 1969. The Globe and Mail Report on Business. February 20, 1969. The Reader's Digest Great World Atlas . Montreal: The Reader's Digest Association (Canada) Limited, 1962. Williamson, H.H., Agent. B r i t i s h Columbia Freight T a r i f f No. 20. Burnaby, B.C. ( f i r s t issued November 7, 1967 and subject to continuous r e v i s i o n ) . A P P E N D I X - 66 -APPENDIX I TABLE OF ECONOMIC AREAS IN BRITISH COLUMBIA SHOWING NUMBER OF SCHEDULED CARRIERS ACTIVE IN EACH MODE OF TRANSPORT FROM VANCOUVER (APRIL, 1969) Region Number of Scheduled Carriers Number Regions and Economic Areas Water R a i l Road A i r Main Branch Line Line EAST KOOTENAY REGION Cranbrook Fernie Golden Kimberley Windermere-Lake Invermere 2 2 3 2 1 WEST KOOTENAY REGION Arrow Lakes-Nakusp f e r r i e s - 1 5 -* Castlegar-Kinnaird - - 1 3 1 Creston-Kaslo barge » 1 2 -Nelson - - 1 3 Revelstoke - 1 - 6 -Slocan Lake-New Denver - - 1 3 -Trail-Rossland 1 3 (Castlegar)* 3 OKANAGAN-SIMILKAMEEN-BOUNDARY Armstrong-Spallumcheen Enderby Grand Forks Greenwood-Kettle Valley Kelowna Keremeos 01iver-Osoyoos Penticton Princeton Summerland Vernon 2 5 1 5 2 2 1 2 2 6 1 3 1 4 barge - 1 5 1 4 2 5 2 6 LOWER MAINLAND REGION Abbotsford (Matsqui-Sumas) Burnaby Chilliwack Delta Coquitlam Hope-Fraser Canyon Kent-Harrison Hot Springs Langley Maple Ridge-Pitt Meadows towing 1 4 1 1 2 1 2 1 12 (Vancouver) 5 -* 11 (Vancouver) 7 (Vancouver) 5 5 -* 4 _* 4 - 67 -Region Number of Scheduled Carriers Number Regions and Economic Areas Water R a i l Road A i r Main Branch LOWER MAINLAND REGION (cont'd) Mission - 1 New Westminster - 3 North Vancouver - 1 Richmond - 1 Sechelt-Gibsons Landing 2 Squamish-Howe Sound - 1 Surrey - 3 West Vancouver - 1 Vancouver - 4 10 (Vancouver) 1 9 (Vancouver) 2 8 (Vancouver) 1 -* 1 5 6 (Vancouver) 12 4 VANCOUVER ISLAND REGION Alberni 1 Vancouver Island North 3 Campbell River 1 Courtenay-Comox 1 Duncan Gulf Islands-Saltspring 1 Ladysmith-Chemainus Lake Cowichan Nanaimo 2 Parksville-Qualicum Beach 1 Sooke-Jordan River 1 Ucluelet-Tofino 1 Greater V i c t o r i a 1 Zeballos-Tahsis 1 2 1 3 2 2 2 2 1 2 2 2 2 3 1 2 2* 1* 1 -it 1 1* SHUSWAP-CHILCOTIN Ashcroft-Clinton Kamloops L i l l o o e t t Merritt Shuswap Lake-Salmon Arm Williams Lake-Chilcotin 6 7 1 4 6 4 1* LOWER COAST REGION Ocean F a l l s - B e l l a Coola 1 Powell River 1 3 2 1 2* CENTRAL INTERIOR REGION Burns Lake McBride Prince George Quesnel Smithers Vanderhoof 1 1 1 1 1 1 1 3 5 5 4 4 3 2* 1 1* - 68 -Region Number Regions and Economic Areas Number of Scheduled Carriers Water R a i l Main Line Branch Line Road A i r NORTH-WESTERN REGION K i t ima t-Klemtu North-West B.C. Prince Rupert Queen Charlotte I s . Stewart-Portland Canal Terrace 7 2 4 -* 3 2* I* 1 10 PEACE RIVER REGION Dawson Creek Fort Nelson Fort St. John 3 2 3 A i r charter service i s normally available. Sources (a) (b) (c) Regional Index of B r i t i s h Columbia, issued by Bureau of Economics and S t a t i s t i c s . Fourteenth Annual O f f i c i a l B r i t i s h Columbia Ship-by-Truck Directory, Automotive Transport Association of B.C., 1968. Timetables published by c a r r i e r s . WHITEHOtZSe MAP I PRINCIPAL ROUTES OF RAIL TRANSPORT IN BRITISH COLUMBIA UNIVeiLSITY OF &JZITISH COLUMBIA APQ.IL, 1969 SOURCE —• RAILROAD MAP OF WESTERN CANADA AND ALASKA , ISSUED BY CANADIAN FREIGHT ASSOCIATION (UNDATED) 69 EDMONTON CALGARY 44°N 20 40 lO 60 too NHITtHOQ.SE 10 EDMONTON CALGARY MAP 2 PRINCIPAL ROUTES Of WATER TRANSPORT IN BRITISH COLUMBIA UNiveaeiTY OF AAIT/SM COCUM&IA APAIL.I969 SOURCE — scneoui.es OF MAJOR CARRIERS BRITISH COLUMBIA FERRIES COAST FERRIES LTD. ISLAND TUG &. BARGE LTD. NORTHLAND NAVIGATION CO. LTD ZO 40 60 0O 100 FAIZ untax 49'N \ \ rvfli I CftUKSC SKASWAY ) JUNEA \ \ , STEWART I I f HAZELTON 120 W —1 60°N roaTNetsoH FORT STX/OHNs', DAWSON CH.UK 11 NDt PHAIIUE \SMiTneas OXEN ciuewrre CITY JPRINCE eupi TERRACE I {KIT/MAT KEMANO . BURNS LAKE aemt eooCA 1 FOOT ST. JAMES . VANDESHOOF , NIMPO LAKE PRINCE GEO&GE ' QIJESNEL Af°BRIDE \JNIULIAMS LAKE EDMONTON JASPEH SANff MAP 3 PRINCIPAL ROUTES OF ROAD TRANSPORT IN BRITISH COLUMBIA UNIVCASITY OF BRITISH COLUMBIA APB/L./9&9 SOURCE - — BRITISH COLUMBIA ROAD MAP i9ae DEPARTMENT OF TRAVEL INDUSTRY, VICTORIA 20 do bo 00 100 POH/ELISJIIVEII LILIOOET vamMisn MEee/rr fPENTICTON tt/OPE T.GARY REVELSTOKE '•49'N \ \ r^SKAGWAY*) V \ JUNEA 120 /V — I 600A/ FORT NELSON 7Z MASser JUtKATLA V . ST6WAQT HAZELTQN \SMITHEQS WNCERUPERTS T £ ^ c e » KIT!MAT BURNS LAKE -DAWSON CHEEK GRANDE PRAIRIE' ' VANDE8H00F KEMANO #Ue£N CHAR LOT T€ CITY MARSTLE fsJtNDSPIT TASUSO, OCCAN FALLS \ mBtUA CCOLA . NIMPO LAKE SELLA BFLLA \ NAMU MAP 4 PRINCIPAL HOUTiS OF AIR TRANSPORT IN BRITISH COLUMBIA UNIVERSITY OF BRITISH COLUMBIA APIZJL,I969 SOUQJCE - • SCHEDULES OF MAJOS2. CA&Q./EAIS &.C.AIG.UNES LTD. CANADIAN PACIFIC AI&UNES PACIFIC WESTEGN AIZUNES LTD. e 20 _ 4c no ac too \ PRINCE GEORGE < QJJESNEL Mc BRIDE YDM ON TON JASPER i WILLIAMS LAKE BANFF HOL0EK \&y&£ cove PORT ALICE K^UWOT^^Te&ALLQS -CAMPBELL* ITAHSIS RIVER COMOK ' PT.ALBERh LONG- REACH POWELltelVER NANAIMO y , CLINretry . REVELSTOKE CALGARY 'KAMLOCPS \ " SPtTNCES »RIDG£ *MERR(TT ^SWJAMISH; WNCGUVEtZ VERNON^ fKELOWNA-f PEN7ICT0N h KIMbERLEY FERN CRANE&OQX •MOPE +PRINCETON VICTORIA 

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