The Steel Box That Cut Shipping Costs by 90 Percent

On April 26, 1956, the Ideal X — a World War II tanker retrofitted by trucking-company owner Malcom McLean — left Port Newark for Houston carrying 58 identical steel containers stacked above its cargo holds. Loading the ship took less than eight hours. Loading a comparable break-bulk freighter, where longshoremen muscled barrels and crates one at a time, took several days.

McLean's insight was not the box itself. Containers in various forms had existed for decades. His insight was the system: a box sized to fit the trucks he already owned, the ships he was building, and — eventually — railcars. He patented his corner-fitting design and then released it royalty-free, betting that universal compatibility was worth more than per-box licensing.

The International Organization for Standardization adopted the dimensions in 1968. By the late 1970s the major shipping routes ran on container freight. Ports that did not adapt — most famously the docks of New York and London — emptied out within a generation, replaced by container terminals like Newark, Felixstowe, and Rotterdam that needed cranes and yard space rather than warehouses and longshoremen.

The economic effect is hard to overstate. Economists Bernhoffen, El-Sahli, and Kneller estimated in a 2013 paper that containerization explained more of the postwar growth in international trade than any tariff treaty. Ocean-shipping costs per ton fell by something like 90 percent. The world that produced the iPhone — designed in California, assembled in Shenzhen, sold in Frankfurt — runs on McLean's box.