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by making it much easier for manufacturers to go overseas in search of low-cost inputs. The labor-intensive assembly will be done in a low-wage country—but there are many low-wage countries.
A doubling of the distance cargo is shipped—from Hong Kong to Los Angeles, for example, rather than Tokyo to Los Angles—raises the shipping cost only 18 percent. Places
Container shipping thrives on volume: the more containers moving through a port or traveling on a ship or train, the lower the cost per box. Places with lower demand or poorer infrastructure will face higher transport costs and will be far less attractive manufacturing sites for the global market.
Declining goods prices in the late 1990s, thanks largely to imports, helped bring three decades of inflation to an end.
These companies’ megaships may have sailed between two ports, but the cargo they carried was increasingly unlikely to have been produced in or to be destined for the end points of the voyage.
Many ship lines sacrificed the potential advantages of containerization by ordering vessels that carried containers along with other types of cargo or even passengers.
If the market repeatedly misjudged the container, so did the state. Governments in New York City and San Francisco ignored the consequences of containerization as they wasted hundreds of millions of dollars reconstructing ports that were outmoded before the concrete was dry.
The huge increase in long-distance trade that came in the container’s wake was foreseen by no one.
almost everything long distances simply did not occur to him. Chinitz was hardly alone in failing to recognize the extent to which lower shipping costs would stimulate trade.
Containers themselves kept getting larger, with 48-foot and even 53-foot boxes allowing trucks to haul more freight on each trip.
If it should sink, it will take nearly $1 billion of cargo with it. Its capacity will be 18,000 TEUs, or 9,000 standard 40-foot containers, enough to fill a 68-mile line of trucks each time it arrives in port. Where it will call is a serious question, because few ports anywhere are deep enough to accommodate it.
The answer may well be brand-new ports built in deep water offshore, with Malacca-Max ships linking offshore platforms and smaller vessels shuttling containers to land. If they ever come about, these enormously costly ships and ports will create yet more economies of scale, making it still cheaper and easier to move goods around the
