The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger (10 page)

In a narrow sense, of course, these critics are correct. The high cost of freight handling was widely recognized as a critical problem in the early 1950s, and containers were much discussed as a potential solution. Malcom McLean was not writing on a blank slate. Yet the historians’ debate about precedence misses the transformational nature of McLean’s accomplishment. While many companies had tried putting freight into containers, those early containers did not fundamentally alter the economics of shipping and had no wider consequences.

Malcom McLean’s fundamental insight, commonplace today but quite radical in the 1950s, was that the shipping industry’s business was moving cargo, not sailing ships. That insight led him to a concept of containerization quite different from anything that had come before. McLean understood that reducing the cost of shipping goods required not just a metal box but an entire new way of handling freight. Every part of the system—ports, ships, cranes, storage facilities, trucks, trains, and the operations of the shippers themselves—would have to change. In that understanding, he was years ahead of almost everyone else in the transportation industry. His insights ushered in change so dramatic that even the experts at the International Container Bureau, people who had been pushing containers for decades, were astonished at what he had wrought. As one of that organization’s leaders confessed later, “we did not understand that at that time a revolution was taking place in the U.S.A.”
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A
dock strike loomed
over East Coast ports in the autumn of 1956. Facing the prospect that the Pan-Atlantic and Waterman fleets would sit idle, Malcom McLean decided to use the time to advantage. Six of Waterman’s C-2 freighters were transferred to Pan-Atlantic’s control. They were sent to Waterman’s shipyard in Mobile, which had been closed after World War II but was reopened to convert them into pure containerships. The idea was to build a honeycomb of metal cells in the holds so that 35-foot containers, two feet longer than those carried on the
Ideal-X
, could be lowered in and stacked five or six high. The ships were to be rebuilt and back at sea by 1957. Of course, there was no model of a pure containership, the metal cells did not exist, and no one had ever stacked containers five or six high. How tightly should the containers fit into the cells? How would a stack of six containers behave when a ship rolled in heavy seas? And how could the vessels be unloaded at ports where there were no land-based cranes? As was his way, McLean did not preoccupy himself with such details. He simply told his staff to get the job done.
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The C-2s, unlike Pan-Atlantic’s T-2 tankers, had been designed to carry large amounts of mixed cargo in their five holds, and altering them posed no great problem. The decks were widened from 63 feet to 72 feet, and the hatches were expanded so that the entire container storage area would be accessible from above. The cells to hold the containers inside the ship were a tougher challenge. At the Alabama State Docks in Mobile, Keith Tantlinger built a mock-up 20 feet high. The cell guides, vertical strips of steel with a 90-degree angle to hold the corners of a container, were mounted on hydraulic jacks, which could be raised and lowered to simulate a heeling ship. A crane tried to deposit and remove a container from the cell while it was at various angles, and instruments measured the stresses and strains on the container and the cell as it tilted this way and that. After hundreds of tests, Tantlinger concluded that each cell should be 1$ inches longer than the container it was meant to hold and 3/4 of an inch wider; smaller dimensions made it too hard for the crane operator to ease the box into the cell guides, but larger ones allowed the container to shift too much. The cells were built and installed in the holds, giving the C-2s the ability to carry 226 containers, almost four times the load of the
Ideal-X.
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Bigger ships with bigger loads would make loading and unloading vastly more complicated. The methods used for the smaller T-2s were no longer good enough: with 226 containers, a loading rate of one container every seven minutes would require a vessel to spend more than twenty-four hours in port to take on a full load. Every aspect of the operation needed to be redesigned for faster handling. Tantlinger invented a new trailer chassis, with edges sloped so that a container being lowered by a crane would be guided into place automatically. A new locking system allowed a longshoreman to secure or release the container by raising or lowering a handle at each corner of the chassis, doing away with the labor-intensive routine of using iron chains to prevent the box from slipping off the truck. These changes meant that a truck could deliver or take on a container and quickly drive away without occupying precious space at dockside. The containers themselves were redesigned with heavy steel corner posts to support the weight of more containers above them, and a new refrigerated version had the cooling unit set within the profile of the container, so that it could be stacked along with nonrefrigerated boxes. New doors were designed with the hinges recessed within the rear corner posts rather than protruding from the sides.

All of these new containers had a special steel casting built into each of their eight corners. The casting contained an oblong hole designed to accommodate the most critical invention of all, the twist lock. This device, with one conical section pointing down and another up, could be inserted into the corner castings of containers as they were stacked. When one was lowered upon the other, a longshoreman could quickly turn the handle and lock the two boxes tightly together. By pulling the handle the other way, a worker could release the two boxes in seconds when it was time to discharge the ship.
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Not until the cells and containers had been designed could Pan-Atlantic focus on the other critical component of its new operation, the cranes. The big dockside cranes in New York and Houston were inadequate to meet the new demands, and the other ports McLean wanted to serve lacked large cranes altogether. Shipboard cranes were the obvious answer, but existing shipboard cranes were not big enough to lift a 35-foot container weighing 40,000 pounds. No established maritime crane manufacturer could design and deliver a test model within the 90 days left in McLean’s ambitious schedule. In desperation, Tantlinger, who knew of the logging industry from his years in Washington State, proposed calling companies that manufactured diesel-powered logging cranes. Robert “Booze” Campbell, whose engineering firm helped redesign the ships and terminals, came upon the Skagit Steel & Iron Works in Sedro-Woolley, Washington.

Skagit Steel’s owner, Sidney McIntyre, had never worked on ships and was unfamiliar with electric cranes, but he agreed to build one. He was, in Campbell’s description, “a mechanical genius.” Within ninety days, Skagit Steel produced an enormous crane, which rode on a huge gantry that bridged an entire ship. The C-2s had their wheelhouses amidships, so each vessel required two cranes, one fore and one aft. The cranes moved backward and forward on rails placed along the ship’s sides and could travel across the width of the vessel, stopping immediately above any container and hoisting it vertically. Long, folding arms allowed the cranes to travel out over the dock to pick up and lower containers.
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The combination of cells and gantry cranes allowed the containers to be handled with unprecedented speed. Once the first column of cells had been unloaded, the ship could be loaded and unloaded simultaneously, in assembly-line fashion: each time the crane traveled to the dock to deposit an incoming trailer on an empty chassis, it would pick up an outgoing trailer and place it into an empty cell. With two cranes, each loading and unloading fifteen boxes an hour, the
Gateway City
, the first of the converted C-2s, could be emptied and reloaded in just eight hours. The new ships were “[t]he greatest advance made by the United States merchant marine in our time,” said Congressman Herbert Bonner, chairman of the Merchant Marine Committee. Tantlinger was not so certain. Before the
Gateway City’s
first voyage, on October 4, 1957, he dropped by the F. W. Woolworth store in Newark and purchased all of the store’s modeling clay. He cut the clay into small pieces with his pocket knife and wedged several pieces in the narrow spaces between the corners of the top containers and the metal frames of the cells. When the
Gateway City
docked in Miami three days later, he retrieved the clay to see how much the containers had shifted. The indentations on the clay revealed that they had moved by only
of one inch—proof, at last, that a stack of containers in the hold would not sway dangerously as a containership rolled at sea.
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Pan-Atlantic had four of its six pure containerships in service by the end of 1957, with a ship sailing south from New York or east from Houston every four and a half days. The last two converted C-2s joined the fleet early in 1958. The
Ideal-X
and its sister tankers were sold off, along with 490 of the original 33-foot containers and 300 matching chassis. Pan-Atlantic’s Sea-Land Service, its capacity five times larger than it had been a year earlier, seemed poised for explosive growth.
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Instead, it sailed into trouble. McLean planned to use two of the all-container ships to open service to Puerto Rico in March 1958. Puerto Rico was a potentially lucrative market. As an island, it relied on ships to provide almost all of its consumer goods. As a U.S. commonwealth, it was subject to the Jones Act, a law requiring that cargo moving between U.S. ports use American-built ships with American crews. Limited competition allowed the few carriers serving Puerto Rico to charge very high rates, and McLean figured that Pan-Atlantic’s containers could easily grab market share. He figured without the longshoremen. When the first containership arrived from Newark, longshoremen in San Juan refused to unload the containers. Four costly months of negotiation ensued, with two ships sitting idle. Pan-Atlantic finally bent to union demands to use large, twenty-four-man gangs to handle containerships, and regular service opened in August. The delay, plus the cost of getting rid of the now obsolete tankers, drove McLean Industries dangerously into the red. A net loss of $4.2 million for 1958 nearly wiped out the earnings retained during the company’s first three years.
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McLean was not deterred. Pan-Atlantic’s problems, he determined, were rooted in the maritime industry’s passive, slow-moving culture. Domestic ship lines, such as Pan-Atlantic, operated in a highly regulated environment that left little room for entrepreneurial spirit. American-owned lines operating internationally, such as Waterman, were allowed to join international rate-making cartels. U.S.-flag ships, using American crews, had the exclusive right to carry the huge flow of U.S. government shipments, including military cargo, and many lines received government operating subsidies as well. This sheltered culture led to excesses like Waterman’s headquarters building in Mobile, with its revolving globe in the lobby and the lavish executive suite on the sixteenth floor. It did not breed the sorts of creative, aggressive, hungry employees that suited Malcom McLean. McLean decided it was time for a culture change. In June 1958, Pan-Atlantic, which now ran only containerships, moved to a new headquarters in a converted pineapple warehouse near the Newark docks, while Waterman, the traditional breakbulk ship line, was deliberately left behind in Mobile.

The new Pan-Atlantic office had a very different atmosphere. Malcom McLean had a simply furnished glass-fronted office facing a large, open floor on which desks were lined up side by side. Every morning, McLean wandered the floor to check on the latest cash flow statement or the status of shipbuilding plans, disregarding hierarchy to get the information he wanted. The company’s tone, though, was set by his sister Clara. Her desk was in the middle of the floor, where she could keep an eye on everything and everyone. She knew who had come in late. She decorated the office; managers who were promoted into glass-fronted offices of their own found that she had selected their furnishings for them, right down to the art. “If you put a picture or a calendar on the wall, you got a note from Clara the next morning,” one recalled. She set the rules: coffee nowhere but the coffee room, no personal phone calls, desks cleared every night. She personally reviewed every single time card and approved every hire.
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Malcom McLean was not the only shipping magnate with an interest in containerization. In 1954, as McLean was leasing terminals for his proposed roll on-roll off service on the East Coast, the Matson Navigation Company began to sponsor academic research on cargo ha.ndling. Matson, based in San Francisco, was thinking about containers as well, but its approach was the polar opposite of McLean’s.