EVERHARD SEES FEWER SHIP LINES

EVERHARD SEES FEWER SHIP LINES

Survival of the fittest in terms of technology, marketing and operations will continue to rule the maritime industry in the years ahead, according to the chairman of OOCL (USA) Inc.

Noting that the maritime industry lost some 39 ship lines in the past 10 years, Conrad Everhard said the number of lines will continue to shrink.Within five years, the industry will feature a host of niche operators but only two or three U.S.-flag carriers will be counted among the 15 or 16 worldwide ship operators, predicted Mr. Everhard, who heads the U.S. general agency for Orient Overseas Container Line and Dart Containerline.

Those carriers whose global liner services survive will be those that employ sophisticated computer communications systems, control their own terminals and staff their own offices throughout the world, Mr. Everhard said last week at the 12th annual North Carolina World Trade Association convention.

In one of his typically wide-ranging speeches, Mr. Everhard also touched on the Federal Maritime Commission's review of the 1984 Shipping Act.

The ship lines agreed to practically everything the big shippers wanted in 1984 when the legislation was developed, he said.

But because shippers are not the best operators in Washington, he added, the FMC is reviewing the impact of such provisions beneficial to shippers as service contracts, which enable shippers to receive lower rates in exchange for minimum cargo volume guarantees.

Despite the FMC review, the Shipping Act is here to stay and it will be a formidable task to change it, other than a bit of fine-tuning, Mr. Everhard said.

The shipping executive also hit on some labor cost issues affecting ocean carriers.

Only a few days after the New York Shipping Association reported that 1988 costs in New York for the International Longshoremen's Association's guaranteed annual income program are expected to increase from 1987's $39 million, Mr. Everhard blasted the program to assist workers losing jobs to automation as throwing money out the window.

He also complained about shipboard labor costs, noting that when Malcolm McLean pioneered containerization with Sea-Land Service, the former truck driver viewed ship captains as offshore truck drivers.

But today's ship captains don't deserve the romantic image spawned during the schooner era or even as offshore truck drivers, Mr. Everhard said.

Thanks to automation, everything is done for him, rendering a captain little more than an offshore robot - yet one who still can earn in excess of $300,000 a year, he said.

On more general trade issues, Mr. Everhard described the U.S. trade bill as deficient in that purely political concerns play too great a role.

Nevertheless, he said the bill is needed to provide U.S. companies with a level field on which to operate.

Because of such factors as the weakened U.S. dollar, he continued, the United States is competitive now and if we don't export now, we never will.

However, it's difficult for the little guy to break the trend of GM buying

from GM, Mr. Everhard said, referring to the practice of divisions within multinational corporations purchasing their needs from each other.

Therefore, it's in the ship lines' interests to assist the small exporters in order to expand the export base, he said.

And in response to a University of North Carolina professor's comment that the world needs a trading system built on equitable distribution of the trade benefits, the blunt-talking Mr. Everhard smiled as said: Inequity is in the eye of the beholder.