Chapter Sixty-Six: The Chest That Changed the World
Just as the invention of the stirrup changed the course of history and reconstructed the world map, the seemingly inconspicuous container changed the world economic pattern and contributed to the emergence of a globalized market. Pen @ fun @ pavilion wWw. ļ½ļ½ļ½Uļ½Eć ļ½ļ½ļ½ļ½
A large cold aluminium or steel chest with lots of welds and rivets, a wooden plank at the bottom, and two huge doors at one end. A standard container looks like a tinplate canning box that has been magnified many times.
This invention seems to be low, far less lofty than computers and the Internet. But it is this seemingly low-tech invention that has shrunk the planet and revolutionized people's lives.
In his previous life, John had read the book "Containers Change the World" very carefully. He knows very well how this simple innovation can change the world.
Before the advent of shipping containers, the cost of transporting goods was so high that there were many things that were not cost-effective to transport half a country, let alone half the world. Many manufacturers have built factories in a few large industrial zones in order to be close to suppliers and customers, and they have to endure high land prices, high labor costs, and high pollution.
And with the advent of shipping containers, freight has become so cheap that it is far more cost-effective to ship a commodity made in Asia to New York than to produce it in the suburbs of New York. Small towns away from major population centers can now take advantage of their low land and labor costs to attract factories that no longer need to be close to ports for cheap shipping.
Large industrial centers, like the Ford Jung factory, with its large stalls and thousands of manufactured products from start to finish, have gradually given way to smaller, more specialized factories that ship parts and semi-finished products to each other along an ever-expanding supply chain. As a result, China has been able to enter the stage of the world's factory.
So, when exactly were containers invented? It is believed to have been invented in 1956 by Malcolm McLean, the owner of an American trucking company. That year, he shipped the first batch of 58 containers from the Port of Newark, New Jersey to Houston, starting a modern container shipping business.
But upon coming into this world, John discovers that the history of containers is much earlier than he knew in his previous life. More than 100 years ago, in 1801, Dr. Anderson of the United Kingdom proposed the idea of container transportation. By the second half of the 19th century, in response to the threat of trucking, railway companies in many countries adopted container systems.
As early as 1920, the Vanderbilt family's New York Central Railroad began to use standard steel containers with a length of 9 feet. Each railway wagon can hold 6 such containers, each with a carrying capacity of 5 tons. With these containers, the railway can be much more efficient and less expensive when transferring goods along the route.
The use of containers in rail transport has long been the norm, and the benefits are well known. In 1933, the International Container Transport Association (ICB) was established in Paris, France, to coordinate the cooperation of all parties involved in container transportation.
However, in the field of international transportation, which is dominated by sea transportation, the development of containers has been slow. In the absence of uniform container standards and common terminal equipment and handling processes, countries are even more troublesome in handling containers than bulk shipments.
In addition, it is difficult to effectively connect between railway, highway and sea transportation, and many containers still need to be unloaded after arriving at the port, stacked in transit warehouses, and transported back empty containers. In international trade, customs taxes both goods and containers, and it costs money to ship empty containers back to the place of origin.
Therefore, John is very clear that in order to realize the global transportation of standard-size containers, all yards, docks, cranes, ships, routes, highways, transfer stations, bridges, tunnels, and trucks must be transformed accordingly.
The establishment of such a complete set of logistics and transportation system is simply impossible with the current strength of FedEx. John's original idea was to realize the intermodal transportation of containers by rail and road in China first.
Even so, it is not easy to achieve this "small goal". This is not something that can be solved by just customizing a batch of large iron boxes. In fact, such work has already begun.
When Tom Jr. first joined the company, John commissioned IBM to analyze tens of thousands of transportation data from the New York Central Railroad in recent years. In the era when there is no computer and Internet big data, this work alone took half a year and tens of thousands of punch cards.
Through calculations, John came to the conclusion that a 20-foot container would be the most efficient. Containers that are too long will lead to idleness, while containers that are shorter than 20 feet will greatly increase the number of loading and unloading. Every pound of weight saved in a container is worth 20 cents, and every cubic foot added to the volume of the container is worth $20.
John himself was well aware of the dimensions of the several standard shipping containers that would be used in later generations, but he was not doing so in vain. First of all, today's transportation conditions are fundamentally different from those of the previous life, and they cannot be rigidly copied. Secondly, he also intends to promote the management concept of "speaking with data" within the company.
Once the data analysis was complete, John's next step was more complicated. First, he needed to procure enough trucks to transport containers. General Motors, Ford, Chrysler have all participated in FedEx's tender to design a flatbed truck that can transport 20-foot containers.
Although he has not yet received the design plan, John actually has a goal in his heart, that is, the GMC ten-wheeled truck used by the US military in World War II. The car's performance was well proven in future World War II. The body is large enough and powerful enough, and although the standard load capacity is 2.5 tons, it can still fly forward even if it carries more than twice the weight. Just a slight increase in the length of the trailer was enough to meet John's requirements.
Then, John: They also need to redevelop new types of loading and unloading equipment. They experimented with several 20-foot steel containers, and the jib carousel cranes currently used in the yard are cumbersome and inefficient to operate, making them unsuitable. John commissioned a Westinghouse heavy machinery factory to design an electric crane that could move laterally on rails, and the design they came up with was similar to that of later gantry cranes.
Finally, John and the others also need to improve the entire business process and operations of FedEx Express, as well as the facilities of the warehouse center. This may seem simple, but it is actually John's biggest headache, because the improved business process will cause a large number of stevedores to lose their jobs.
Once this container transportation model is widely used, the army of workers who are poorly paid and poorly paid and make a living by unloading trucks at railway stations will be completely unemployed. Although these people are not strictly FedEx employees, and they are only in a temporary employment relationship with the company, the United Transportation Union is bound to not give up.
Historically, Malcolm McLean, the "father of modern container shipping," also encountered significant resistance when he first started this business. The dock union resisted the reform, and the negotiations lasted four months, costing him $4.2 million.
At that time, in addition to the dock unions, the seafarers' unions were also very dissatisfied with the sudden increase in work intensity. These merchant sailors who ran all over the world could have used the time spent loading and unloading cargo to go ashore in a foreign port for several days. But once the containers were used, they could only spend a few hours in the remote yard where the containers were stored, and once the high-speed cranes had finished loading and unloading the metal boxes, their ship would pull anchor and set sail.
John, who had seen the power of the American labor movement, had been hesitant to wait a few years for the United States to enter the war before introducing container transport. At that time, on the one hand, a large number of able-bodied stevedores will be conscripted into the army, and on the other hand, the union leaders will reach an agreement with the government to fully support the operation of the wartime economy, and all strikes and protests will be suspended.
Although it is difficult to promote the container intermodal business, this does not prevent John from fooling Xiaomaersk with this. It's not the first time he's done this kind of thing, isn't this how little Tom was put on the "thief ship" by him in the first place?
John enthusiastically described to Maersk his vision of a grand picture of global sea-land transport. In order to enhance his persuasiveness, he calculated an account for Maersk.
"If a pharmaceutical company in the middle of the United States, let's say Chicago, wants to ship a truckload of drugs to a city in the interior of Europe, how much does it cost them to transport it?" John snapped his fingers and counted the various service providers that the pharmaceutical company had to deal with during the journey.
"First, he had to hire a local Chicago truck driver to deliver the medicine to the freight yard at the train station in a truck; Then pay the railroad company to take the freight to New York or Baltimore; Hire a local truck driver in the port city to take the goods from the station to the terminal; rent a warehouse at the port; Find a steamship company and let them take the cargo to Europe; rent a warehouse in a port in Europe; Finally, a trucking company is hired to deliver the goods to the customer. ā
"And that's not all." John continued: "In this process, he also needed an insurance company, a European customs brokerage service, and a shipping agent to monitor the complex process from start to finish. ā
"Do you know how much he needs to spend on transportation during the whole process?" John paused and emphasized: "No less than $2,400, which is almost a quarter of the total cost of the product, and half of that is the cost of using the port." ā
"You're right." "We have also calculated that the average shipment stays at the port of departure and arrival for about 15 days, and the warehouse rent, insurance, loading and unloading fees, and terminal usage fees during this period add up to almost twice the cost of pure sea transportation." ā
"You see, if containers were used, it would take more than ten hours to fill a ship, instead of four or five days now, and these goods would not have to stay for so long." John found himself having succeeded in piquing Ponyk's interest in containers, and he knew he had achieved his goal.
John gave his contact information in the United States to Maersk, agreeing to discuss the issue further later. John was confident that when the young man arrived in the United States, he would come to him on his own initiative.