United States Department of Transportation
i
The impact of modifying the Jones Act on US coastal shipping.
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2014-06-01
[PDF-11.38 MB]
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Abstract:The study assesses exempt coastal shipping defined as exempted from the US-built stipulation of the
Jones Act, operating with functional crews and exempted from Harbor Maintenance Tax (HMT). The
study focuses on two research questions: (a) the impact of the US-built exemption on the cost of coastal
shipping; and (b) the competitiveness of exempt services. The assessment is based on three typical case
studies, the first two involving short and long-range services for domestic cargoes (containers and
trailers) provided by RoRo ships; the third, short-range feeder service for international containers
provided by LoLo ships. The study finds that building coastal ships in foreign yards could save about
40% of the capital cost of the RoRo ships and 60% for the LoLo ships. However, due to favorable
financing terms for using US shipyards (Title XI), the savings in capital cost would only amount to
13%, 11%, and 4% reductions in door-to-door shipping cost for the three case studies. Because of
these minor reductions, along with other structural factors, the study concludes that exempt coastal
services in all three case studies are uncompetitive with present truck and rail services.
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