Source: "Automobile Facts and Figures," Automobile Manufacturers Association.

Senator BARTLETT. Thank you, sir.

Senator Butler?

Senator BUTLER. Mr. Gilliland, I am very interested in the cooperation between the carriers in the development of these rates. What is the friction now? Has that ceased to exist?

You indicate in the latter part of your statement that you are cooperating with these people. Where does the opposition to the act of 1958 come from?

Mr. GILLILAND. Senator Butler, so far as opposition to making rates is concerned, we are not running into any of that.

Senator BUTLER. What I am saying is this: that if you are cooperating with the motor carriers in the making of these rates, why is there such a drive to pass this bill to overturn what the Congress did in 1958? Where does the opposition from this bill stem? Where does the opposition to the 1958 Transportation Act come from?

Mr. GILLILAND. I think the opposition is simply this: It is the desire of the highway carriers, and the waterway carriers, to get us back to the place where we are unable to make any reduction in our rates at all.

Senator BUTLER. I realize that. One segment of the over-the-road carriers are cooperating with you. I would like to hear a little bit more about the extent of that cooperation.

Mr. GILLILAND. Well, sir, whenever there is need for a joint service from one of the manufacturing assembly plants to a new territory, we have approached the motor carriers operating beyond our line to effect delivery in certain areas, and asked them if they would care to join us in joint rates.

Senator BUTLER. Are they unhappy in that union with the railroads?

Mr. GILLILAND. Only to the extent, Senator, that I think they would like to go back to what they had before. They are not refusing to cooperate, but they are giving us their ready cooperation on that.

Senator BUTLER. That is the point I am trying to get at, that they cooperate with you in this endeavor, but they would rather go back to where they were and carry all the freight all the distance; is that the point?

Mr. GILLILAND. Yes. Mr. Rentzel, who appeared before you here, is probably the largest participant in the joint rates that we have published. He is a party to our joint tariffs in the States of Oklahoma, Texas, New Mexico; and we have had a very fine, high degree of cooperation with him.

I still say, though, that I think he would like to go back to what it was before and have us have this umbrella of rates up here which would not compel him, or make it desirable for him to join in a venture like this.

Senator BUTLER. Even though admittedly the railroads can do it cheaper on the longer haul of over 500 miles?

Mr. GILLILAND. That is true. Mr. Rentzel himself testified, as I recall the figure he used was around 400 miles. He admitted that above 400 miles the rails had the lower cost of transportation. Senator BUTLER. I have no further questions.

I want to commend Mr. Langdon for his very forceful statement, and also Mr. Gilliland. I was very much enlightened by both of those statements.

Senator BARTLETT. Senator Monroney?

Senator MONRONEY. Mr. Gilliland, you are familiar, I believe, with the report and order recommended by George A. Dahan, hearing examiner, in the recent examiner's finding are you not?

Mr. GILLILAND. I have read the report, Senator.

Senator MONRONEY. You testified a good deal about the trilevel cars. In order to try to keep this in perspective, on page 6 of the report, the examiner cites-and I will ask at this point that the entire findings of the hearing examiner, dated Washington, D.C., 9th day of June 1961, be made a part of the record.

Senator BARTLETT. It is so ordered.

Senator MONRONEY. In the summary he finds that the Chrysler Corporation v. Akron C. & Y. Company, supra :

The Commission fixed rates on new passenger automobiles in carloads. In doing so it considered the usual movement of four automobiles loaded in a boxcar. The prescribed basis was not limited to the type of equipment used, but applied on new passenger automobiles transported by railroad. The introduction of a new type of equipment does not affect the Commission's order. The plan III rates and the plan V (all-rail) rates from and to ramp points are subject to that order. The evidence is crystal clear that some of these rates and charges do not comply with the prescribed basis.

I merely cite that finding in order to not exclude plan V which you have detailed here in your trilevel cars.

Apparently the examiner has found that the rate on a car is a rate on a car, regardless of the type of equipment.

Then going down to the last paragraph before his final finding:

The examiner finds that the investigated and assailed rates and charges on freight and passenger motor vehicles between certain points in central, southern, and southwestern territories are unjust and unreasonable, and otherwise unlawful and in contravention of the national transportation policy. Except to the extent that a modification of the order in Chrysler Corp. v. Akron C. & Y. Co. supra, is necessary, the examiner would make his findings without prejudice to the establishment of TOFC all-rail (plan II) and rail-motor (plan V) rates which are no lower than the all-motor rates or the present all-rail regular rates, whichever are lower.

This was the finding, I believe, the most recent action by the ICC hearing examiner.

Isn't it true, in light of this, that the loss of automobile traffic by the Frisco and other railroads to motor carriers was primarily a matter of service, rather than ratecutting by the motor transport companies?

Mr. GILLILAND. I think the primary loss was in the service angle, Senator, supplemented, of course, by the rate situation, too.

When the total cost of moving automobiles was taken into account, we were at a disadvantage on both counts.

Senator MONRONEY. The haulage rate from point to point was taken into account. There was no reduction between specific points on the auto transport lines prior to piggyback?

Mr. GILLILAND. Yes, there were instances.

Senator MONRONEY. Generally speaking it was service rather than rate. It was determining the movement of automobiles by truck. rather than by rail.

Mr. GILLILAND. No.

Senator MONRONEY. You don't know what the rates were?

Mr. GILLILAND. I think that, generally speaking

Senator MONRONEY. The point I am trying to make is, was it necessary, in order to meet competition, for you to cut about a third below competition?

Mr. GILLILAND. It was necessary for us to cut below.

Senator MONRONEY. Didn't the examiner find that the piggyback service provided by the Frisco was competitive with all-truck service? Mr. GILLILAND. That was the opinion he expressed; yes. Senator MONRONEY. And that it was competitive.

Despite competitive service by this new means, with all-trucks, aren't the rates set by the Frisco, then, far lower than the all-truck rates?

Mr. GILLILAND. They are lower, yes.

Senator MONRONEY. To what degree, between-you mentionedTulsa and Dallas?

Mr. GILLILAND. I may have some figures on that.

Mr. GRINNELL. If I may interrupt you, on page 10 of the report you are reading there are comparisons of all-motor, all-rail, and the Frisco piggyback rates. I have copies of that here.

Senator MONRONEY. As I read that, Tulsa, Okla., plan V, per auto, $58.90; all-motor, per auto, $62.83.