The Steel Box That Changed Global Logistics

by: Paul Gerou on

Container ship at the Port of Long Beach. Photo: Jim Park

Did you know a trucking entrepreneur invented the modern shipping container?

A dockworker from the 1950s would not recognize a modern cargo port, where huge gantries move steel boxes full of cargo from all over the world between ships, trains, and trucks.

As part of a series on 

powerful dockworkers' unions -- because containers would mean fewer jobs (although it also would make loading ships safer; In a large port, someone would be killed every few weeks.)

When I recently interviewed Andrew McAfee, an MIT scientist who studies how technological progress changes business, the economy, and society, about the future of autonomous trucks, he pointed to the automation at ports as an example of how the march of technology continues to mean the loss of jobs in some areas and the gain of jobs in others.

In 1937, longshoremen at ports in New York transfer bananas from a conveyor that carries them from the hold of the ship onto the dock and then load them into freight cars. Source: U.S. National Archives and Records Administration
In 1937, longshoremen at ports in New York transfer bananas from a conveyor that carries them from the hold of the ship onto the dock and then load them into freight cars. Source: U.S. National Archives and Records Administration

Other obstacles? Trucking companies, shipping companies, and ports couldn't agree on a standard size. And separate sets of U.S. regulations kept tight control on how much  shipping and trucking companies could charge.

"The man who navigated this maze of hazards, and who can fairly be described as the inventor of the modern shipping container system, was called Malcom McLean," notes the BBC article. A trucking entrepreneur, "He knew plenty about trucks, plenty about playing the system, and all there was to know about saving money.... As Marc Levinson explains in his book, The Box, McLean not only saw the potential of a shipping container that would fit neatly onto a flat bed truck, he also had the skills and the risk-taking attitude needed to make it happen."

In the 1950s, McLean exploited a regulatory loophole to gain control of both a trucking company and a shipping company, and when dockers went on strike, he retrofit old ships to new container specifications.

As the World Shipping Council reports, "On 26 April 1956, Malcom McLean's converted World War II tanker, the Ideal X, made its maiden voyage from Port Newark to Houston in the USA. It had a reinforced deck carrying 58 metal container boxes as well as 15,000 tons of bulk petroleum. By the time the container ship docked at the Port of Houston six days later, the company was already taking orders to ship goods back to Port Newark in containers. McLean's enterprise later became known as Sea-Land Services, a company whose ships carried cargo-laden truck trailers between Northern and Southern ports in the USA."

But the real breakthrough came in the last 1960s, says the BBC, when McLean convinced the U.S. military that container shipping was a far faster way to get equipment to Vietnam. The "backhaul?" Goods from Japan. Trans-Pacific trade began in earnest.

One transformation McLean couldn't navigate, however, was deregulation in the early 1980s. As reported in HDT's 1998 book "100 Years of Trucking," McLean's eponymous North Carolina-based trucking company was one of the first to fold in the new highly competitive era. However, Sea-Land Services was eventually split into three entitities, according to Wikipedia, and the international container shipping business today is part of the Maersk Group.