Competition in the Transport Industries: A Review and Prospects

The transportation industry has passed into an extremely competitive era. There is intense competition both among the different modes of common carriers, and among private carriers of all kinds and common carriers for freight and passenger. The intense controversy in Congress and before the regulatory commissions recently has been largely over rate reductions and rate-making procedures that intensify competition. Rates have been relatively stable for the past 3 years, and rail rates have actually declined slightly for farm products. Three areas of major difference have developed: (1) The Interstate Commerce Commission's interpretation of the Transportation Act of 1958 has made it somewhat less difficult for railroads to justify their competitive rate reductions; (2) the ICC and court interpretations of the new piggyback proposals (Plans III and IV) of the railroads have permitted some experimentation with all-commodity rates as opposed to the historic classification and commodity rate making; (3) finally, the competition from private autos and trucks has compelled common carriers of both freight and passengers to seek ways of reducing rates and fares through volume freight rates and heavier loading of freight cars and trucks, air bus and shuttle fares, and other devices.