Econ Focus

A Shipping Visionary

On May 25, 2001, Malcolm McLean died at the age of 87. McLean pioneered the use of containers to ship cargo. Before container shipping, workers transferred non-bulk goods piece by piece between vessels, trucks and trains, a time-consuming task with a high risk of breakage.

McLean was first exposed to shipping when he left his parents’ farm in Maxton, N.C. He saved enough money to buy a used truck to haul dirt and supplies for other local farmers.

Like many other truckers, McLean had to wait for his goods to be unloaded and placed onto the ship. The whole process could take up to 10 days, giving him plenty of time to think about how much time — and money — was being wasted. He was quoted as saying, “I don’t have much nostalgia for anything that loses money.” McLean wondered if there was a reason why the entire truck couldn’t be loaded onto the ship, something which would surely save time.

Meanwhile, McLean Trucking excelled, growing to 1,776 trucks before he sold the company in 1955. With the $6 million he received from the sale, McLean bought the Pan Atlantic Tanker Company, an aging oil tanker business. Renaming the company Sea-Land, McLean began implementing his timesaving ideas.

He found that loading a cargo-carrying trailer onto a ship wasn’t a problem. Then he saw a more effective way of doing it — removing the wheels from the trailer and moving it on and off of a separate truck chassis. The first cargo container was born.

Those initial containers were first tried out on April 26, 1956, on the “Ideal X,” a modified tanker that sailed from Port Newark, N.J., to Port Houston, Tex. The ship carried 58 35-foot containers. But it would take another 10 years for the global shipping community to fully embrace the idea. The first transatlantic shipment took place in 1966, when container shipping was introduced to Europe at a reengineered cargo port in the Netherlands. In 1999, Sea-Land was acquired by Maersk Line and is known today as Maersk Sealand, one of the largest shipping companies in the world, with an international client base.

McLean, through his invention, changed the face of world trade. Containers cut down on costs and expedited delivery, making trade much more efficient. If Malcolm McLean proved one thing through his vision of shipping, it was that a concept does not have to be complicated to be great.