UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549
                            FORM 10-K
(Mark One)
(x)  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE
     ACT OF 1934
     For the fiscal year ended December 27, 1996
                               OR
( )  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES
     EXCHANGE ACT OF 1934
     For the transition period from __________________ to __________________

                  Commission File Number 1-8544
                                
                                
                                

                           APL LIMITED
     (Exact name of registrant as specified in its charter)

          Delaware                                   94-2911022
(State or other jurisdiction of                (I.R.S. Employer
incorporation or organization)              Identification No.)

                          1111 Broadway
                       Oakland, CA  94607
            (Address of principal executive offices)
         Registrant's telephone number:  (510) 272-8000
   Securities registered pursuant to Section 12(b) of the Act:

                                                Name of each exchange on
Title of each class                             which registered
Common  Stock,  Par                             New York Stock Exchange
   Value  $.01                                  Pacific Stock Exchange
Rights  to  Purchase Series A                   New York Stock Exchange
  Junior  Participating  Preferred  Stock       Pacific Stock Exchange

Securities registered pursuant to Section 12 (g) of the Act:
                              None
                         ______________
Indicate  by  check  mark  if disclosure  of  delinquent  filers
pursuant to Item 405 of Regulation S-K is not contained  herein,
and  will  not  be  contained, to the best of  the  registrant's
knowledge,   in  definitive  proxy  or  information   statements
incorporated by reference in Part III of this Form 10-K  or  any
amendment to this Form 10-K.  (x)

Indicate by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section 13  or  15(d)  of  the
Securities Exchange Act of 1934 during the preceding 12  months,
and  (2)  has been subject to such filing requirements  for  the
past 90 days.  Yes (x)  No ( )
                         ______________
At  February  28,  1997  the number of shares  of  Common  Stock
outstanding was 24,590,789.  Based solely upon the closing price
of  the  New  York  Stock Exchange on such date,  the  aggregate
market  value  of  Common Stock held by  non-affiliates  of  the
registrant was approximately $324.5 million.
                                
               Documents Incorporated by Reference

Portions  of  registrant's Proxy Statement for its  1997  Annual
Meeting of Stockholders are incorporated by reference into  Part
III hereof.
                         ______________
<PAGE>                                

                         TABLE OF CONTENTS

                                                          Page

                              PART I

Items 1. and 2.  BUSINESS AND PROPERTIES                  3-13
Item 3.        LEGAL PROCEEDINGS                         13-14
Item 4.        SUBMISSION OF MATTERS TO A VOTE OF
                 SECURITY HOLDERS                           14

                              PART II

Item 5.        MARKET FOR THE REGISTRANT'S COMMON STOCK AND
                 RELATED STOCKHOLDER MATTERS                14
Item 6.        SELECTED FINANCIAL DATA                   14-15
Item 7.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND
                 RESULTS OF OPERATIONS                   16-28
Item 8.        CONSOLIDATED FINANCIAL STATEMENTS AND
                 SUPPLEMENTARY DATA                      28-55
Item 9.        DISAGREEMENTS ON ACCOUNTING AND
                 FINANCIAL DISCLOSURE                       56

                              PART III

Item 10.       DIRECTORS AND EXECUTIVE OFFICERS
                 OF THE REGISTRANT                          56
Item 11.       EXECUTIVE COMPENSATION                       57
Item 12.       SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                 OWNERS AND MANAGEMENT                      57
Item 13.       CERTAIN RELATIONSHIPS AND RELATED
                 TRANSACTIONS                               57

                              PART IV

Item 14.       EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND
                 REPORTS ON FORM 8-K                     57-66

               SIGNATURES                                67-68
<PAGE>
                             PART I


ITEMS 1. AND 2. BUSINESS AND PROPERTIES

      APL  Limited and its subsidiaries (the "company") provide
container  transportation and related services in the Americas,
Asia,  the Middle East and Europe, through an intermodal system
combining ocean, rail and truck transportation.

       The   company   provides  transportation  services   for
containerized  cargo  in the trans-Pacific,  intra-Asia,  Asia-
Europe, Asia-Latin America and North American markets.  Certain
of  the  services  are  provided through alliances  with  other
transportation  companies.  In addition, the  company  provides
cargo  distribution and warehousing services in  the  U.S.  and
freight  consolidation  services in Mexico,  Asia,  the  Middle
East,  Europe  and  Africa.  The company also provides  freight
deconsolidation services in several U.S. locations and acts  as
a  non-vessel operating common carrier in the intra-Asia market
and  from  Asia to Europe and Australia.  The company  provides
intermodal  transportation and freight  brokerage  services  to
North  American and international shippers, as  well  as  time-
critical   cargo   transportation  and  just-in-time   delivery
(principally to the automotive manufacturing industry).   These
services are provided through an integrated system of rail  and
truck  transportation, the primary element of  which  is  train
services provided utilizing double-stack rail cars.

      The company's international transportation operations are
conducted  through  American President Lines,  Ltd.,  an  ocean
common carrier with operations in the Pacific Basin, Europe and
Latin  America.  Another operating unit, American Consolidation
Services,  Ltd.,  provides cargo distribution, warehousing  and
freight   consolidation  services.   Stevedoring  and  terminal
operations  on the U.S. West Coast are conducted through  Eagle
Marine  Services,  Ltd.  American President Business  Logistics
Services,  Ltd.  provides logistical consulting and  management
services.    The   company's   North   America   transportation
operations  are conducted through APL Land Transport  Services,
Inc.,  which  provides intermodal transportation.  The  company
was  engaged  in  real estate operations through  Natomas  Real
Estate  Company  until  1994, when its  remaining  real  estate
holdings were sold.

TRANSPORTATION

International

      The  company  provides  ocean-going  containerized  cargo
transportation services primarily in the trans-Pacific  market,
as  well  as  in  the  intra-Asia, Asia-Europe  and  Asia-Latin
America  markets.   The company offers seven  scheduled  trans-
Pacific  services  per week between key  ports  in  the  United
States, Canada, Mexico, Latin America and Asia.

      The  company provides scheduled service between  over  60
ports in the Pacific and Indian Oceans and in the Arabian Gulf.
In  the intra-Asia market, the company provides service between
over  500  Asian cities and commercial centers.  The  company's
trans-Pacific services are provided between Asia and over 5,000
cities    in    North    America   via   eight    West    Coast

<PAGE>
ports  and  three  East Coast ports.  In addition,  service  is
offered between Asia and Europe to over 2,000 cities in  Europe
which  are served through five northern European ports.   Also,
in  the  market between Asia and the Caribbean, Latin  America,
Central  and  South  America, over 100  ports  and  cities  are
served.   The company's ocean transportation business maintains
313  offices and agencies located in 15 countries in North  and
South  America,  25 countries in Asia and the Middle  East,  15
countries  in  Europe,  three  countries  in  Africa,  and   in
Australia.

     Since 1991, the company and Orient Overseas Container Line
("OOCL")  have  been  parties to agreements  enabling  them  to
exchange  vessel  space and coordinate vessel sailings  through
2005.   These agreements permit both companies to offer  faster
transit times and more frequent sailings between key markets in
Asia  and  the  U.S.  West Coast, and to  share  terminals  and
several feeder operations within Asia.  In September 1994,  the
company,  Mitsui OSK Lines, Ltd. ("MOL"), and  OOCL  signed  an
agreement to exchange vessel space, coordinate vessel  sailings
and  cooperate  in the use of port terminals and equipment  for
ocean transportation services in the Asia-U.S. West Coast trade
through  2005.   The  carriers  commenced  service  under  this
agreement  in January 1996.  The agreement between the  company
and  OOCL  is  suspended so long as the agreement  between  the
company, OOCL and MOL is in effect.

      The  three  carriers and Nedlloyd Lines B.V. ("NLL")  are
parties  to  a  separate  agreement to exchange  vessel  space,
coordinate  vessel sailings and cooperate in the  use  of  port
terminals  and equipment in an all-water service in  the  Asia-
U.S.  East Coast trade for a minimum of three years.  The  four
carriers initiated service under this agreement in March 1995.

        Additionally,   the   four   carriers   and   Malaysian
International  Shipping  Corporation  BHD  ("MISC")   have   an
agreement to exchange vessel space, coordinate vessel  sailings
and  cooperate  in the use of port terminals and equipment  for
ocean  transportation services in the Asia-Europe trade through
2001,  with early termination rights upon six months notice  to
the  other  parties  beginning January 1, 1998.   The  carriers
commenced  service  under the agreement in January  1996.   The
company  entered  the  Asia-Europe  trade  in  March  1995   by
chartering vessel space through MOL.

      The above agreements between the company, OOCL, MOL,  NLL
and MISC are collectively referred to as the Global Alliance.

      NLL  merged  with  the container line operations  of  The
Peninsular  and  Oriental Steam Navigation Company  ("P&O")  on
December  31, 1996 to form P&O Nedlloyd Container Line  Limited
("P&O-NL").   NLL  and  P&O  were  each  members  of  different
alliances, and the future alliance participation of P&O-NL  has
not  yet been determined.  If P&O-NL does not continue  in  the
Global  Alliance, there could be a significant  impact  on  the
Global Alliance's operations.  The company cannot predict  when
the  alliance participation of P&O-NL will be determined or the
resulting  impact  on  the operations of the  Global  Alliance.
However, while no assurances can be given, the company believes
that acceptable alternatives may be available.

     In September 1996, the company and Transportacion Maritima
Mexicana  ("TMM")  amended  their existing  agreement  for  the
reciprocal  charter of vessel space.  The amended agreement  is
effective  until late April 1999 and automatically  renews  for
one year unless terminated with one year's notice.

<PAGE>
     The company and Matson Navigation Company, Inc. ("Matson")
commenced  service under a 10-year alliance in  February  1996.
In connection with the alliance, the company sold Matson six of
its  U.S.-flag ships (three C9-class vessels and three C8-class
vessels)  and  certain of its assets in Guam for  approximately
$163  million in cash.  One of the ships was sold  in  December
1995, and the remaining five vessels were sold in January 1996.
Four of these vessels, together with a fifth Matson vessel, are
currently being used in the alliance.  Matson is operating  the
vessels  in  the  alliance, which serves the U.S.  West  Coast,
Hawaii, Guam, Korea and Japan, and has the use of substantially
all  the  westbound  capacity.  The  company  has  the  use  of
substantially all the alliance vessels' eastbound capacity.

     The following tables show the company's line haul capacity
provided  to  and available from alliance partners (the  Global
Alliance,   TMM  and  Matson)  under  the  company's   alliance
agreements for 1996 and as estimated for 1997, in thousands  of
twenty-foot equivalent units ("TEUs"):

Capacity provided by the company to the alliances: 1996    1997(1)
Trans-Pacific
  Eastbound                                       604.7   602.8
  Westbound                                       460.4   473.2

Capacity available to the company from the alliances:
Trans-Pacific
  Eastbound                                       521.8   561.4
  Westbound                                       384.3   418.5

Asia-Europe
  Eastbound                                        43.6    50.1
  Westbound                                        43.6    50.1

Asia-Latin America
  Eastbound                                        27.9    27.9
  Westbound                                        27.9    27.9

Matson
  Westbound                                        26.3    28.6

TMM
  Eastbound                                        29.8    43.2
  Westbound                                        29.8    43.2

(1)Capacity  for  1997 is based upon the current  schedule  for
   delivery  and  deployment of newly constructed  vessels  and
   implementation  of  the  alliances  and  assumes   currently
   allocated vessel space, which is subject to adjustment.

      Under  the current alliance agreements, alliance partners
contribute  and  are  allocated  vessel  space,  which  may  be
adjusted from time to time.  The agreements provide for,  among
other things, settlement of the difference between the value of
vessel  space provided by each partner and the value of  vessel
space available to that partner, at specified vessel costs  per
TEU per day.  The value of vessel space provided by the company
to  the  alliances is less than the value of the total capacity
allocated  to it through the alliances, resulting in an  annual
net     cash    payment    from    the    company    to     its

<PAGE>
alliance  partners.  The amount paid to alliance  partners  was
$51  million  in  1996, and is currently estimated  to  be  $56
million  in  1997.  Agreements covering terminal and  equipment
sharing  among  the  Global Alliance  partners  have  not  been
reached,  and  the company is unable to predict  at  this  time
whether or when such agreements will be reached.

      In  connection  with  the sale of the company's  K10-class
vessel construction contract to a third party in September 1995,
the  company, MOL, OOCL and NLL formed a joint venture  company,
in  which  their respective shares are each 25%, that agreed  to
charter  back the K10 vessels for seven years.  OOCL has  agreed
to  subcharter the K10s from the joint venture for  seven  years
for  use in the Asia-Europe trade, replacing three of its  2,800
twenty-foot equivalent unit F-class vessels.  The three replaced
F-class vessels are being chartered to the joint venture for ten
years  and  subchartered by the company from the  joint  venture
through May 2000.  The subcharters for two of such vessels  have
been   assumed  by  TMM  through  May  1999.   TMM's   remaining
obligations of $40.8 million under the assumed subcharters  have
been  guaranteed by the company.  The company has been deploying
the  third F-class vessel since May 1996 in its West Asia/Middle
East service.

      International  container  transportation  operations  are
seasonal and subject to economic cycles and the growth of local
economies  in the markets served, fluctuations in the  relative
values  of  the U.S. dollar and various foreign currencies  and
resulting  changes in demand for transportation of  import  and
export  products.  The second and third quarters of  each  year
generally have been the company's strongest in terms of volume,
primarily due to the export of seasonal refrigerated goods from
the  U.S.  in both of these quarters and increased  imports  of
consumer  goods  into  the U.S. in the third  quarter  for  the
Christmas buying season.

      The  following table sets forth the amount and source  of
the  company's ocean shipping revenues for the past five years,
in millions of dollars:

                       1996      1995     1994     1993    1992
Trans-Pacific         $1,228    $1,403   $1,390   $1,378  $1,329
Other Ocean
 Transportation          482       418      352      329     296
     Total            $1,710    $1,821   $1,742   $1,707  $1,625

      In  its  trans-Pacific  markets, the  company  transports
imports into North America that include higher value goods such
as   clothing,   electronics,  automotive   and   manufacturing
components  and other consumer items.  Generally, higher  value
cargo  is  transported at higher rates due to its  value,  time
sensitivity  or  need  for specialized services.   U.S.  export
cargoes transported by the company include refrigerated  goods,
military  shipments  and  lower value, semi-processed  and  raw
materials, as well as auto parts, oil field supplies and  other
higher value finished products.

      In  the  intra-Asia market, the industrialized  economies
import  food,  raw  materials  and  semi-processed  goods  from
developing Asian nations and export auto parts, electronics and
other technological and capital-intensive finished products.

<PAGE>
      The  Asia-Europe  trade is similar in cargo  mix  to  the
trades between North America and Asia.  Shipments from Asia  to
Northern  Europe include higher value goods such as  electronic
goods.   Trade  from Europe to Asia includes many lower  value,
semi-processed and raw materials, as well as carpet  and  floor
coverings and chemicals.

      Exports  from  Asia to Latin America  and  the  Caribbean
include  consumer products, auto parts, motorcycles  and  other
high  value goods.  Cargoes moving from Latin America  to  Asia
include  raw  materials  such  as  coffee  and  cocoa,  resins,
chemicals, and processed goods including foods and beverages.

     The single largest customer of the company's international
transportation operations is the U.S. government,  which  ships
military and other cargo and accounted for approximately 2%  in
1996  and  1995,  and  3%  in 1994, of  consolidated  revenues.
Historically,  the company has bid competitively for  contracts
to  transport military and other cargo for the U.S. government.
In  recent years, the U.S. military has been closing bases  and
reducing  the number of U.S. military personnel overseas.   The
extent to which future U.S. military base closures and rollback
of personnel may impact shipments of U.S. military cargo by the
company cannot be estimated.

      The  company  collected detention charges from  the  U.S.
government  for  containers transported  for  Operation  Desert
Storm  and  held beyond an allowed time, which contributed  $10
million,  $6  million  and $41 million to operating  income  in
1994, 1993 and 1992, respectively.

       The   following   table  shows   the   company's   total
international  transportation volumes in forty-foot  equivalent
units ("FEU") for the past five years:

                     Year           Volumes
                     1996           590,000
                     1995           570,000
                     1994           558,000
                     1993           543,000
                     1992           501,000

     The company is a participant in freight conferences, which
are  groups  of  carriers  that may  jointly  establish  common
tariffs and common rate levels in certain markets.  Conferences
in  trades from and to the U.S. are exempt from U.S. anti-trust
laws  under  the  Shipping Act of 1984  (the  "Shipping  Act").
Conferences  have historically been effective  in  establishing
and  maintaining a stable rate environment for  their  members.
Recently,  however,  carriers  which  are  members  of  freight
conferences,  including the company, have  been  losing  market
share  to  carriers which are not members of  the  conferences.
The  company  estimates  that its share  of  the  trans-Pacific
market  was approximately 8% in 1996 and 1995, and 9% in  1994.
Non-conference  carriers have been increasing  their  capacity,
improving  their  services and charging rates for  transporting
cargo  at  increasingly lower levels than conference  carriers.
In   late   1995,  the  company  reduced  rates  for   specific
commodities  in specific trade lanes in response to competitive
conditions  and  loss  of market share in  the  Asia  to  North
America  market.  Competitors and the company have subsequently
lowered  rates, and considerable rate instability  persists  in
this       market,      as      well      as       in       the

<PAGE>
company's  other  trade  lanes.   The  company  cannot  predict
whether  rate  reductions will continue  to  be  taken  by  the
company  or  its  competitors in 1997, or the  extent  of  such
reductions,  if any.  Continued destabilization  of  rates,  if
extensive, could have a material adverse impact on the  results
of operations of carriers, including the company.

      Since  1989, the company and 13 other shipping companies,
representing  approximately  85% of  total  trans-Pacific  U.S.
import   capacity,  have  been  parties  to  the  Trans-Pacific
Stabilization  Agreement.  Among other  things,  the  agreement
limits  import capacity of participating companies  by  amounts
mutually determined from time to time in an attempt to  improve
the  balance  of  supply and demand in the U.S. import  market.
The  agreement  may  be terminated upon the  unanimous  written
consent of the companies.  The company's ability to be a  party
to  this  agreement is based upon the Shipping  Act,  which  is
discussed on page 11.

      The  company provides cargo distribution and  warehousing
services  in  the  U.S. and freight consolidation  services  in
Asia,  the  Middle East, Europe, Mexico and Africa through  its
subsidiary, American Consolidation Services, Ltd. ("ACS").  ACS
also  provides freight deconsolidation services in several U.S.
locations and acts as a non-vessel operating common carrier  in
designated trade lanes.  Freight consolidators combine  various
shipments  from  multiple vendors into a single container  load
for  delivery to a single destination.  The company also serves
shippers of less-than-containerload cargoes by combining  their
shipments   with  others  bound  for  the  same  or   proximate
geographic locations.

      The  company has port terminal facilities in Oakland  and
Los  Angeles, California, Seattle, Washington and Dutch Harbor,
Alaska  and  major inland terminal facilities at South  Kearny,
New  Jersey, Chicago, Illinois and Atlanta, Georgia.  Each port
terminal  facility is operated under a long-term use  agreement
providing for preferential, although non-exclusive, use of  the
facility by the company.  The company utilizes public terminals
in  certain  other locations.  The company also operates  major
port   terminal  facilities  in  Asia  under  long-term   lease
agreements  in Kobe and Yokohama, Japan and Kaohsiung,  Taiwan,
and utilizes public terminals in other locations.

     In 1993, the company entered into a contract with the Port
of Los Angeles to lease a new 226-acre terminal facility for 30
years.   Occupancy  of the new facility is scheduled  for  1997
upon  completion of construction.  Additionally, in  1994,  the
company  and  the Port of Seattle signed a lease amendment  for
the   improvement  and  expansion  of  its  existing   terminal
facility.   Under  the  amended lease,  the  facility  will  be
expanded  from  83  acres  to  approximately  160  acres.   The
expansion  is  expected to be completed during  1997,  and  the
lease term will be 30 years from completion.  In addition,  the
company has the option to further expand both terminals.

      The  company  and  a  Philippine terminal  developer  and
operator formed a joint venture for the development of terminal
facilities in Karachi, Pakistan, in which each share equally in
the  venture's  operations, profits and commitments.   In  June
1996,   the   joint  venture  entered  into  an  implementation
agreement  with an agency of the Republic of Pakistan regarding
construction  and operation of these terminal facilities.   The
joint venture is currently arranging financing for the project.
Subject  to  completion  of  the financing  and  other  related
arrangements, the company currently anticipates construction to
begin in early 1997.

<PAGE>
       In  addition  to  performing  stevedoring  and  terminal
services  for  the  company's  own  operations,  Eagle   Marine
Services,  Ltd.,  a subsidiary of the company,  provides  these
services   to  third  parties  at  the  company's   U.S.   port
facilities.

     On December 27, 1996, the company owned and operated eight
U.S.-flag  containerships and six foreign-flag  containerships.
In  addition,  the  company  owned three  U.S.-flag  Pacesetter
vessels  that were chartered to another carrier.  The following
table  sets  forth the vessels deployed by the company  in  its
trans-Pacific and intra-Asia services at December 27, 1996:

                                                      Maximum
             Number of   Date Placed     Capacity   Service Speed
Type  of Vessel           Vessels         in Service    (in TEUs)
(in knots)
     C-11       6          1995-1996      4,800          24.6
     C-10       5          1988           4,300          24.0
     J-9        2          1984           2,700          22.5
Pacesetter      1          1973           1,400          23.5

      The  company  has  the authority from the  United  States
Maritime  Administration  ("MarAd")  to  operate  an  unlimited
number  of  foreign-flag-feeder vessels in its  intra-Asia  and
Caribbean services.  At December 27, 1996, the company operated
24  such vessels, 23 in its intra-Asia service and one  in  its
Caribbean service, which it leases for remaining terms of up to
three years.

      The  company took delivery of and made final payments  on
five  C11-class  vessels in 1995 and one  C11-class  vessel  in
1996,   built   pursuant   to   construction   contracts   with
Howaldtswerke-Deutsche  Werft  AG,  of   Germany   and   Daewoo
Shipbuilding  and Heavy Machinery, Ltd., of Korea.   The  total
cost  of  the six C11-class vessels was $529 million, including
total  payments to the shipyards of $503 million, of which  $62
million was paid in January 1996.

      At  December 27, 1996, the company operated  134,600  dry
containers  consisting  of  20-, 40-,  45-,  48-,  and  53-foot
containers, 43,100 of which were owned and 91,500 leased  under
operating  lease  agreements.  At that date, the  company  also
operated  8,900 refrigerated containers, 3,600  of  which  were
owned  and  5,300 leased under operating leases.  In  addition,
the  company  operated  54,800  chassis  for  the  carriage  of
containers, 40,200 of which were owned and 14,600 leased  under
capital and operating leases.

North America

      The  company provides intermodal transportation to  North
American  and  international shippers, as well as time-critical
cargo transportation and just-in-time delivery (principally  to
the  automotive  manufacturing industry).  These  services  are
provided  through an integrated system of contracted  rail  and
truck  transportation, the primary element of  which  is  train
services provided utilizing double-stack rail cars.

      The company's double-stack train services principally are
provided  to  the North American long-haul full container  load
freight   markets,   and   the  international   (export-import)
intermodal  market,  through more than 50  U.S.,  Canadian  and
Mexican inland terminal facilities.  The company has agreements

<PAGE>
with certain railroads under which those railroads serve as the
company's rail carriers, providing locomotive power, rail cars,
trackage,   terminal  services  and  labor  to  transport   the
company's containers on individual double-stack rail  cars  and
on dedicated unit trains.

      The  following  table  shows the  company's  total  North
America stacktrain volumes, including automotive, in shipments:
                    Year                Volumes
                    1996                460,000
                    1995                430,000
                    1994                416,000
                    1993                359,000
                    1992                328,000

     A stacktrain comprises up to 28 double-stack rail cars and
has  a  capacity of up to 280 FEUs.  At December 27, 1996,  the
company controlled 370 such rail cars, 220 of which were  owned
and  150  of  which  were  leased.  In  addition,  as  part  of
agreements   with  certain  railroads,  the  company   utilizes
additional  rail  cars  owned or leased  and  operated  by  the
railroads.   The  company controlled 390 and  930  double-stack
rail  cars  in  1995 and 1994, respectively.   The  significant
reduction  in  the  number of rail cars  under  direct  company
control  in  1995 was made pursuant to the company's  agreement
with the railroads.

Information Systems

      The  company manages its fleet of containers and  chassis
using  its  computer systems and specialized  software,  linked
through  a telecommunications network with the company's  ships
and  offices.   The  company's cargo and  container  management
system  processes  cargo bookings, generates bills  of  lading,
expedites U.S. customs clearance and facilitates the management
of  rail cars, containers and other equipment.  The company has
also  developed  computer  systems  designed  to  optimize  the
loading of containers onto ships and to facilitate the planning
of  ship,  rail  and truck moves.  The company's communications
system  permits  its customers to access information  regarding
the   location  and  status  of  their  cargo  via   touch-tone
telephone, personal computer or computer-facsimile link.

Real Estate

     In 1994, the company sold its remaining 86 acres of land.

COMPETITION AND REGULATION

International Transportation

      The company is a U.S.-flag and foreign-flag carrier.   It
faces  vigorous competition, principally on the basis of  price
and  service, on all of its trade routes from approximately  19
major  U.S.-flag and foreign-flag operators, some of which  are
owned   by   foreign  governments.   Foreign-flag   competitors
generally  have  cost and operating advantages  over  U.S.-flag
carriers.   The timing of increases in capacity  in  the  ocean
transportation industry can result in imbalances  in  industry-
wide  supply and demand, which causes volatility in  rates.   A
number        of        competing        ocean        carriers,

<PAGE>
particularly  in the trans-Pacific market, have  placed  orders
for  the  construction of a significant number of new  vessels.
As  a  result, capacity in the trans-Pacific market is expected
to  grow significantly more than demand, which could result  in
further rate reductions.

      The carriage of U.S. military cargo is reserved for U.S.-
flag  shipping  companies, and this trade is  also  subject  to
vigorous competition among such carriers.  The process by which
military cargo was awarded to shippers was revised.  Under  the
Uniform  Commercial Rate contract, effective from June 1996  to
September  1997, the company shares equally in  military  cargo
volumes  with  one  competitor in  certain  cargo  routes.   In
addition,  under the Best Value Rate contract,  effective  from
February to September 1997, the company was awarded 65% of  the
cargo  volumes  in  certain cargo routes.   The  government  is
currently  evaluating which of the above programs is preferable
for  the  award of military cargo.  The company  is  unable  to
predict  which program will be selected or the program's  final
form.

      In 1996, legislation was introduced in the U.S. House  of
Representatives  and  the U.S. Senate that would  substantially
modify the Shipping Act.  The Shipping Act, among other things,
provides the company with certain immunity from antitrust  laws
and  requires  the company and other carriers in  U.S.  foreign
commerce to file tariffs publicly.  Although Congress failed to
adopt  this legislation, it may be reintroduced in  1997.   The
legislation  proposed in 1996 contained provisions  that  would
have  been  phased in, would have eliminated government  tariff
filing,  allowed confidential and independent contracts between
shippers  and  ocean  carriers,  strengthened  provisions  that
prohibit  predatory  activities  by  foreign  carriers,   under
limited continuing oversight by the Federal Maritime Commission
or  a successor agency, while continuing the company's existing
antitrust  immunity.  The company is unable to predict  whether
this  or  other  proposed legislation  will  be  introduced  or
enacted,  and  whether any such legislation will contain  terms
similar  to  those proposed in 1996.  Enactment of  legislation
modifying  the  Shipping Act, depending upon its  terms,  could
have  a material impact on the competitive environment in which
the   company  operates  and  on  the  company's   results   of
operations.   The company is unable to predict  the  nature  or
extent of the impact of this legislation, if enacted.

      A  substantial  portion  of the company's  transportation
operations  is subject to regulation by agencies  of  the  U.S.
government  that  have  jurisdiction over  shipping  practices,
maintenance  and  safety  standards  and  other  matters.   The
company's  wholly-owned subsidiary, American  President  Lines,
Ltd.  ("APL")  and  MarAd are parties to a  20-year  Operating-
Differential  Subsidy  Agreement  ("ODS  Agreement")   expiring
December 31, 1997.  This agreement provides for payments by the
U.S.  government  to partially compensate APL for  the  greater
labor  expense  of  operating vessels under  U.S.  rather  than
foreign  registry.   Under APL's ODS  Agreement,  APL  must  be
controlled  by U.S. citizens and its vessels must be registered
and  built  in the U.S. (except as noted below) and  manned  by
U.S.  crews.  In addition, APL is required to serve such  trade
routes  within designated minimum and maximum numbers of annual
sailings,  and,  except  for over-age  vessels,  APL  may  not,
without  prior government approval, remove any of  its  vessels
from operation under its ODS agreement unless such agreement is
terminated.

<PAGE>
       Since   1981,  Congress  has  twice  passed  legislation
permitting  U.S.-flag carriers to acquire a limited  number  of
foreign-built  vessels and thereafter to operate  such  vessels
under existing subsidy agreements under U.S. flag.  Under  such
laws,  APL  had five C10-class vessels constructed  in  Germany
which are currently operated under this legislation.

      In  June  1993, MarAd awarded APL contracts to manage  10
Ready  Reserve Force ("RRF") vessels for a period of five years
and 2 vessels for a period of two and one half years.  In 1996,
2  RRF vessel contracts expired and were converted into General
Agent  Agreements for two and one half years.  APL  receives  a
per diem fee based upon the operating status of each vessel.

      On October 8, 1996, the Maritime Security Act of 1996 was
signed  into  law.   This  legislation provides  for  a  9-year
Maritime Security Program ("MSP") administered by MarAd with up
to  $100  million  in payments per annum to be appropriated  by
Congress  on  an annual basis.  MSP provides $2.1  million  per
vessel  per  year, compared with up to $3.6 million per  vessel
per year under ODS, and will expire on October 1, 2005.

       On  January  21,  1997,  the  company  signed  operating
agreements  under MSP for nine ships, including five  C10-class
vessels and four C11-class vessels.  The company has a one-year
period in which to begin the participation of those vessels  in
the  program.  Vessels participating in MSP must be  registered
under  U.S.  flag and manned by U.S. crews and must participate
in  the  Emergency  Preparedness  Program  established  by  the
Maritime   Security   Act,   and   certain   U.S.   citizenship
requirements  are  applicable  to  the  participating  carrier.
Transfers  of operating agreements and substitution of  vessels
are  permitted  under specified circumstances, subject  to  the
prior approval of MarAd.  The operating agreements are one-year
contracts,   which  will  be  automatically   renewed   through
September  30,  2005 subject to available funding.   If  annual
funding is not appropriated by the U.S. Congress, the operating
agreements  may be terminated on 60-days notice by MarAd.   The
agreements may also be terminated by the participating  carrier
on  60-days  notice  at  any time, provided  that  the  carrier
continues to participate in the Emergency Preparedness  Program
and  the vessels continue under U.S. flag registry through  the
end of the then-current fiscal year.

      Due  to  the  enactment of MSP, the company's  collective
bargaining agreement covering its unlicensed personnel  expired
and  was  renegotiated, and a new agreement  was  reached  with
these unions on December 18, 1996.  The new contract expires in
June  1999.   Existing agreements covering  licensed  personnel
expire in December 1997 and June 1998, and the company has been
engaged  in  discussions  with  the  related  unions  regarding
continuation  of those agreements.  The company  is  unable  to
predict  when  or  whether new agreements may be  reached,  and
labor  disturbances could result which could  have  a  material
adverse impact on the company.

      In  January 1995, the company and Columbia Shipmanagement
Ltd.,  a Cyprus company ("Columbia"), entered into an agreement
under   which   Columbia  has  agreed   to   provide   crewing,
maintenance, operations and insurance for the company's six C11-
class vessels for a per diem fee per vessel.  The agreement may
be terminated at any time by either party with notice.

<PAGE>
North America Transportation

      The  company's stacktrain operations compete  with  eight
trans-Pacific  containership  companies  and  two  West   Coast
railroads  offering double-stack train service.   In  addition,
the   company's  stacktrain  operations,  together   with   its
contracted  trucking services, compete with long-haul  trucking
companies  for  truckload  shipments.   The  company   provides
brokerage  services  for major customers  who  require  a  full
spectrum of transportation and ancillary services.

EMPLOYEES

      At  February  1,  1997, the company and its  subsidiaries
employed  182  seagoing  and 3,798  shoreside  personnel.   The
seagoing  personnel  and  294 of the shoreside  personnel  were
employed  under collective bargaining agreements  with  several
unions.


ITEM 3.   LEGAL PROCEEDINGS

       The   company  is  a  party  to  various  pending  legal
proceedings,  claims and assessments arising in the  course  of
its  business activities, including actions relating  to  trade
practices, personal injury or property damage, alleged breaches
of  contracts, torts, labor matters, employment practices,  tax
matters  and  miscellaneous  other  matters.   Some  of   these
proceedings involve claims for punitive damages, in addition to
other specific relief.

      Among these actions are approximately 3,290 cases pending
against  the company, together with numerous other ship  owners
and  equipment manufacturers, involving injuries  or  illnesses
allegedly  caused  by  exposure  to  asbestos  or  other  toxic
substances on ships.  In May 1996, an order was entered in  the
United  States  District  Court for  the  Eastern  District  of
Pennsylvania,  which administratively dismissed  most  of  such
cases  without  prejudice and with all statutes  of  limitation
tolled,  and  with reinstatement permitted upon fulfillment  by
plaintiffs of certain specified conditions.  In July 1996,  the
Court  issued  an  order to reinstate 29 cases  against  vessel
owners and to dismiss the vessel owners' third party claims and
cross-claims  against  manufacturers of asbestos  products.   A
motion  for reconsideration of such dismissal is pending.   The
company  is  presently  unable  to  ascertain  or  predict  the
potential  impact of this order on the disposition or  eventual
outcome of such cases.

      The  company insures its potential liability  for  bodily
injury   to   seamen  through  mutual  insurance  associations.
Industry-wide   resolution  of  asbestos-related   claims   and
resolutions  of claims against bankrupt shipping  companies  at
higher   than  expected  amounts  could  result  in  additional
contributions  to those associations by the company  and  other
association members.

     In December 1989, the government of Guam filed a complaint
with  the  Federal  Maritime Commission ("FMC")  alleging  that
American President Lines, Ltd. and an unrelated company charged
excessive  rates for carrying cargo between the U.S. and  Guam,
in  violation of the Shipping Act and the Intercoastal Shipping
Act   of   1933,   and  seeking  an  undetermined   amount   of

<PAGE>
reparations.   Three private shippers are also complainants  in
this  proceeding.  On June 3, 1996, the FMC administrative  law
judge  ordered that the complaint be dismissed on  the  merits.
The  complainants filed its appeal with the  FMC  on  July  25,
1996,  and  American President Lines, Ltd. filed its  reply  on
September  16,  1996.  A decision by the  FMC  is  expected  in
August 1997.

      Based upon information presently available, and in  light
of  legal  and other defenses and insurance coverage and  other
potential   sources  of  payment  available  to  the   company,
management  does  not  expect the legal proceedings  described,
individually  or  in the aggregate, to have a material  adverse
impact  on  the  company's consolidated financial  position  or
operations.


ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      No  matter  was  submitted to a  vote  of  the  company's
security holders during the fourth quarter of 1996.


                             PART II


ITEM 5.   MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
       STOCKHOLDER MATTERS

      The company's Common Stock is listed on the New York  and
Pacific  Stock  Exchanges using the symbol APL.   The  reported
high  and  low closing sales prices per share of the  company's
Common  Stock  and  cash dividends declared for  the  preceding
eight  fiscal  quarters  are  set  forth  in  Note  14  to  the
consolidated financial statements, Part II, Item 8, on page  54
and are incorporated herein by reference.

      On  February  28,  1997,  the company  had  3,129  common
stockholders of record.


ITEM 6.   SELECTED FINANCIAL DATA

      The  following selected financial data for the five years
ending  December  27,  1996 are derived from  the  consolidated
financial  statements of the company, which have been  examined
and   reported   upon  by  the  company's  independent   public
accountants.   The selected financial data should  be  read  in
conjunction  with  the  Consolidated Financial  Statements  and
Management's Discussion and Analysis of Financial Condition and
Results of Operations.

<PAGE>
FIVE-YEAR FINANCIAL REVIEW
(Dollars in millions,
  except per share amounts)1996    1995    1994    1993    1992
Results of Operations (1)
Revenues                 $2,739  $2,896  $2,794  $2,606  $2,516
Operating Income            141      68     123     133     140
Income Before Taxes         104      53     110     131     122
Income Before Cumulative 
  Effect of Accounting 
  Change                     70      30      74      80      78
Net Income                   70      30      74      80      56
Earnings Per Common Share,
  Fully Diluted, Before
  Cumulative Effect of
  Accounting Change (2)    2.67    0.99    2.30    2.50    2.34
Earnings Per Common Share,
  Fully Diluted (2)        2.67    0.99    2.30    2.50    1.69
Cash Dividends Per
  Common Share (2)         0.40    0.40    0.40    0.30    0.30
Financial Position
Cash, Cash Equivalents
  & Short-Term
  Investments             $ 283   $ 136   $ 255   $  84   $ 132
Working Capital             226      65     206      51    (16)
Total Assets              1,880   1,879   1,664   1,454   1,436
Net Capital Expenditures    144     456     128     156      66
Long-Term Debt and Capital
  Lease Obligations         696     687     386     267     242
Redeemable Preferred Stock                   75      75      75
Stockholders' Equity        503     469     541     475     397
Capital                   1,209   1,168   1,007     822     829
Book Value Per
  Common Share (2)        20.47   18.28   19.82   17.72   15.25
Financial Ratios
Return on Equity (3)      14.3%    5.6%   12.7%   15.7%   11.6%
Cash Flow to Average
  Total Debt (4)          17.7%   30.1%   53.3%   53.7%   43.4%           
Return on Average Assets   3.7%    1.7%    4.8%    5.5%    3.8%
Total Debt to Equity (3) 140.4%  149.0%   63.4%   49.4%   75.5%
Total Debt to Capital (3) 58.4%   59.8%   38.8%   33.0%   43.0%
Current Ratio               1.6     1.1     1.5     1.1     1.0
(1)The  company's  fiscal  year ends  on  the  last  Friday  in
   December.   All years presented above were 52 weeks,  except
   for 1993 which was a 53-week year.
(2)Earnings  Per Common Share, Cash Dividends Per Common  Share
   and  Book Value Per Common Share have been computed for  all
   periods  retroactively reflecting the effect  of  a  2-for-1
   stock  split  effected on December 31, 1993.   Earnings  Per
   Common  Share  also  reflect  the  1995  conversion  of  the
   redeemable  preferred  stock  into  4.0  million  shares  of
   common  stock and the repurchase of 1.3 million, 6.0 million
   and  3.7 million shares of the company's common stock  on  a
   post-split basis during 1996, 1995 and 1992, respectively.
(3)Redeemable preferred stock, which was converted into  common
   stock  in  1995,  is included in Equity for the  purpose  of
   calculating these ratios.
(4)Cash Flow represents Cash Flows from Operating Activities.

<PAGE>
ITEM 7.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
       CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

Summary Results
(In millions)                 1996  Change   1995  Change   1994
Revenues
Container Transportation    $2,358 (8%)    $2,577    3%   $2,497
Logistics Services and Other   381  19%       319    8%      297
 Total                      $2,739 (5%)    $2,896    4%   $2,794
Operating Income              $141 106%       $68 (44%)     $123
Pretax Income                 $104  96%       $53 (52%)     $110

Overview

     The  company's pretax income excluding non-recurring items
was  $62 million in 1996, as compared with $90 million in  1995
and  $85 million in 1994.  Non-recurring gains in 1996 included
$22  million  in gains from asset sales, $13 million  in  gains
related  to  the curtailment of retirement obligations  due  to
workforce reductions, and $7 million in gains from the sale  of
the company's domestic distribution services segment.  In 1995,
non-recurring items included $11 million in gains  from  vessel
sales  and  liquidated damages from delayed vessel  deliveries,
which were offset by a $48 million restructuring charge.   Non-
recurring  items in 1994 included $10 million  related  to  the
collection  of  Desert Storm detention charges, $9  million  in
gains  from  the  sale of the company's remaining  real  estate
holdings, and $6 million from crane and container sales.

     In   1996,   the  company's  earnings  were  impacted   by
reductions  in rates from 1995 levels throughout  its  markets.
Partially  offsetting  these  rate  reductions  were  increased
volumes  in  all  markets  except North  America  to  Asia  and
Automotive,  and  reduced operating costs in all  areas  except
cargo  handling,  as  compared with 1995.  Sales,  general  and
administrative expenses, in particular, declined  20%  in  1996
compared with 1995.
     
     In  1995,  the company's earnings were impacted by  volume
growth  in  the  company's North America  to  Asia  market,  an
improvement  in average revenue per FEU in the company's  ocean
transportation markets, and lower land transportation costs per
FEU  in  1995,  all as compared with 1994.  These factors  were
partially offset by lower volumes in the Asia to North  America
market compared with 1994.

<PAGE>     
Container Volumes
  by Major Market(1)         1996   Change   1995  Change   1994
Asia To North America        187.9    7%     176.1 (8%)     190.6
North America to Asia        128.2 (13%)     146.8  11%     132.7
Intra-Asia                   157.2    1%     155.2 (4%)     161.4
Asia-Europe                   39.3  100%      19.6 100%
Latin America                  9.2   56%       5.9  34%       4.4
Refrigerated                  51.3    1%      50.9   4%      49.1
Stacktrain                   405.0    7%     379.6 (1%)     383.6
Automotive                    83.7 (10%)      93.5  30%      71.9
(1)  Volumes are stated in thousands of FEUs, except Stacktrain
   and  Automotive, which are stated in thousands of shipments.
   Volumes data are based upon shipments originating during the
   period, which differs from the percentage-of-completion method
   used for financial reporting purposes.

Asia to North America

     Volumes  increased in 1996 due primarily to strong  export
activities  in  South  China, Hong Kong and  Indonesia.   Lower
manufacturing  costs  in  South  China  have  shifted  customer
production   facilities  to  that  region,  thereby  increasing
volumes from that area.  Increased volumes in the Asia to North
America  market in 1996 is also attributable to  the  company's
efforts  to  regain market share and related  rate  reductions.
Volumes  in this market declined between 1994 and 1995  due  to
increased competitive pressure from non-conference carriers and
lower demand.

North America to Asia

     Volumes declined in this market in 1996 compared with 1995
due primarily to the company's sale of six vessels and its Guam
business  to Matson in late 1995 and early 1996.  Also,  during
the  first half of 1996, the company generally carried  heavier
cargo  than usual in this market, which constrained utilization
of vessel capacity and volumes.

     Volumes  in this market increased between 1994  and  1995,
primarily  because of increased shipments of resins, wastepaper
and  cotton  to Hong Kong, the People's Republic of  China  and
India.   These increases were partially offset by a significant
decrease in the company's U.S. military volumes in this market.
The company carried approximately 75% of trans-Pacific military
cargo from January to June 1994, and approximately 25% for  the
remainder  of  1994  and  through May  1996.   A  new  military
contract  became  effective in June 1996  whereby  the  company
shares equally in military cargo volumes with one competitor in
certain routes.  The company's military volumes have also  been
affected  by  a general decline in military cargo shipments  in
recent years.

Intra-Asia

     In  1996, the company's intra-Asia volumes increased  from
1995  levels, due primarily to increased shipments between Asia
and  the Middle-East.  Also, the company's 1995 volumes in this
market  were impacted by a drop in shipments to and from  Kobe,
Japan  due  to the January 1995 earthquake in that  region,  as
well  as poor cotton harvests in India and Pakistan.  In  1995,
the company also reduced its shipments of lower-margin cargo in
this market compared with 1994.

<PAGE>
Asia-Europe
     
     In  1996,  volumes in this market increased  significantly
over 1995.  The company began Asia-Europe service in March 1995
with   shipments  to  Denmark,  the  United  Kingdom  and   the
Netherlands primarily from Hong Kong, the People's Republic  of
China and Taiwan.  Shipments from the Netherlands, Belgium  and
Germany  to  Asia  began  in April 1995.   In  1996,  increased
shipments  from  the Netherlands, the United Kingdom,  Denmark,
Hong Kong and Indonesia contributed to the overall increase  in
volumes.

Latin America

     The  company's  Latin  America market  includes  shipments
between  Asia  and  the Americas, including Central  and  South
America,  the Caribbean and the U.S. East Coast.  In 1995,  the
company  initiated all-water service between Asia and the  U.S.
East  Coast via the Panama Canal, which resulted in an increase
in volumes over 1994.  Volumes in this market increased in 1996
from  1995 due primarily to an increase in shipments from  Hong
Kong,  the  People's Republic of China and Korea to Panama  and
Puerto Rico.  An intra-Caribbean service was added in mid-1996,
which  contributed  to increased volumes in the  Latin  America
market in 1996 compared with 1995.

Refrigerated

     Compared  with  1995,  volumes of commercial  refrigerated
cargo  increased slightly in 1996.  This was due  primarily  to
increased  volumes  in  the intra-Asia market,  resulting  from
increased  exports from India and the company's  allocation  of
additional  equipment to this market in 1996.  These  increases
were  partially offset by declining refrigerated cargo  volumes
in  the  U.S.  export market, largely due to the  sale  by  the
company of six vessels and its Guam business to Matson in late-
1995  and  early-1996.   Refrigerated cargo  volumes  increased
between 1994 and 1995 due to strong demand, particularly in the
North  America-to-Asia and intra-Asia markets, and an  increase
in  the  number of refrigerated containers owned and leased  by
the company.

Stacktrain

     North   America  stacktrain  volumes  increased  in   1996
compared  with 1995 due to continued improvement  in  the  U.S.
economy  and  resulting growth in demand.  Volumes declined  in
1995  compared  with  1994  due to increased  competition  from
trucking  companies  and  the loss of several  major  customers
during the year.

Automotive

     Automotive  volumes declined in 1996 compared  with  1995,
primarily  due to a reduced volume of non-stacktrain  shipments
by  U.S.  automobile manufacturers.  This decline was partially
offset  by increased volumes in automotive stacktrain shipments
between  the  U.S.  and  Mexico  and  intra-Asia  shipments  by
Japanese  manufacturers.   Between 1994  and  1995,  automotive
volumes   rose   primarily  because  of  increased   automotive
shipments  between  the U.S. and Mexico,  offset  partially  by
lower overall international automotive volumes.

<PAGE>     
Average Revenue 
  per Unit (1)             1996  Change    1995   Change    1994
Trans-Pacific            $3,390  (11%)   $3,792     2%    $3,721
Other Ocean
  Transportation         $2,122   1%     $2,095    10%    $1,909
Stacktrain               $1,242   (7%)   $1,337    (2%)   $1,368
(1)   Average  revenue per unit is stated in FEUs,  except  for
   Stacktrain, which is in shipments.  Average revenue per unit data
   are based upon shipments originating during the period, which
   differs  from the percentage-of-completion method  used  for
   financial reporting purposes.  Stacktrain revenue  per  unit
   includes Automotive.

Trans-Pacific

     In  1996, the company's trans-Pacific average revenue  per
FEU   declined   substantially  from  1995  due  primarily   to
considerable  pressure on rates in the Asia  to  North  America
market as a result of over-capacity, slower growth in trade and
rate  instability, as well as the company's efforts  to  regain
market  share  by  reducing rates.  In late 1995,  the  company
reduced rates for specific commodities in specific trade  lanes
in  response to competitive conditions and loss of market share
in  the  Asia  to  North America market.  Competitors  and  the
company have subsequently lowered rates, and considerable  rate
instability  persists  in  this  market.   The  company  cannot
predict  whether rate reductions will continue to be  taken  by
the  company or its competitors in 1997, or the extent of  such
reductions,  if any.  Continued destabilization  of  rates,  if
extensive, could have a material adverse impact on the  results
of operations of carriers, including the company.
     
     Average  revenue  per  FEU in the company's  trans-Pacific
markets increased in 1995 compared with 1994 primarily  due  to
general  rate  increases,  currency adjustments  in  Japan  and
Singapore,   and   an  increased  proportion  of   higher-rated
refrigerated cargo.

Other Ocean Transportation

     In  1996,  average revenue per FEU in the company's  other
ocean transportation markets increased slightly from 1995,  due
primarily  to  an  increase  in  higher-rated,  longer-leg  and
refrigerated cargo in the intra-Asia market and rate  increases
in  the  first half of the year.  These increases were  largely
offset   by  rate  deterioration  in  the  Asia-Europe   market
throughout  1996.  Between 1994 and 1995, average  revenue  per
FEU   in  the  company's  other  ocean  transportation  markets
increased,  a trend attributable to general rate increases  and
an  increase  in  the  proportion of higher-rated  refrigerated
cargo carried by the company in the intra-Asia market.

Stacktrain

     Stacktrain average revenue per shipment declined  in  1996
compared with 1995 primarily due to lower rates resulting  from
increased  competition, industry-wide softness  in  demand  and
excess  equipment capacity in this market.  Stacktrain  average
revenue  per  FEU  declined  in 1995  compared  with  1994  due
primarily  to lower rates resulting from increased  competition
from trucking companies and other intermodal carriers.

<PAGE>
Outlook

     The  company expects rate pressures in most of  its  major
markets  to  continue through 1997 due to excess  capacity  and
slow  market  growth.   Anticipated lower rates  combined  with
seasonal  factors  are expected to result in reduced  earnings,
particularly in the first half of the year.

Sale of Domestic Distribution Services

     In  May  1996,  the  company sold its  rights  to  service
certain  domestic  intermodal customers of APL  Land  Transport
Services,  Inc.  ("APLLTS"), a wholly owned subsidiary  of  the
company,  for $2 million in cash and $6 million in  notes,  and
realized a pre-tax gain of $7 million.  In addition, APLLTS and
the  purchaser entered into a 10-year agreement whereby  APLLTS
will  provide  stacktrain services to the purchaser.   Revenues
related  to the servicing rights sold represented approximately
4%   of   the   company's  consolidated   1996   revenues   and
approximately 6% of consolidated 1995 revenues.

Logistics Services and Other Revenues

     This    category   includes   cargo   handling,    freight
consolidation,  logistics services and charter  hire  revenues,
which  totaled $381 million, $319 million and $297  million  in
1996,  1995 and 1994, respectively.  The 1996 increase  is  due
primarily to increased cargo handling revenues associated  with
greater use of the company's terminals.

     The  increase  from 1994 to 1995 resulted from  growth  in
cargo  handling  revenues in Asia and  charter  hire  revenues.
Freight  consolidation  and logistics  services  revenues  also
increased in 1995 from 1994 due to higher volumes.  Included in
the amounts for 1994 were collections of Desert Storm detention
charges of $10 million.

     During the first half of 1995, the company incurred  lower
ocean freight revenues and incremental operating expenses as  a
result of the January 1995 earthquake in Kobe, Japan, in  which
the  ocean  terminal  leased  by the  company  was  extensively
damaged.  The company expects to recover substantially  all  of
these   lost   revenues  and  expenses  through  its   business
interruption  insurance and has submitted  its  claims  to  its
insurers.   Management's  best  estimate  of  the  recovery  is
recorded in Other Revenues in 1995.

Alliances

The Global Alliance

     The  alliance agreements between the company,  OOCL,  MOL,
NLL  and MISC, collectively referred to as the Global Alliance,
were fully implemented in the first quarter of 1996.  Under the
current  alliance agreements, alliance partners contribute  and
are allocated vessel space, which may be adjusted from time  to
time.    The  agreements  provide  for,  among  other   things,
settlement of the difference between the value of vessel  space
provided  by  each  partner  and  the  value  of  vessel  space
available          to         that         partner,          at

<PAGE>
specified   vessel   costs  per  TEU   per   day.    Agreements
covering  terminal  and  equipment  sharing  among  the  Global
Alliance  partners have not been reached, and  the  company  is
unable  to predict at this time whether or when such agreements
will be reached.
     
     NLL  merged with the container line operations of  P&O  on
December  31, 1996 to form P&O Nedlloyd Container Line Limited.
NLL  and P&O were each members of different alliances, and  the
future  alliance  participation of  P&O-NL  has  not  yet  been
determined.   If  P&O-NL  does  not  continue  in  the   Global
Alliance,  there could be a significant impact  on  the  Global
Alliance's  operations.  The company cannot  predict  when  the
alliance  participation of P&O-NL will  be  determined  or  the
resulting  impact  on  the operations of the  Global  Alliance.
However, while no assurances can be given, the company believes
that acceptable alternatives may be available.
     
TMM

     In  September  1996,  the company and  TMM  amended  their
existing agreement for the reciprocal charter of vessel  space.
The  amended agreement is effective until late April  1999  and
automatically  renews for one year unless terminated  with  one
year's notice.

Matson

     The  company and Matson commenced service under a  10-year
alliance  in  February 1996.  In connection with the  alliance,
the  company sold Matson six of its U.S.-flag ships (three  C9-
class  vessels and three C8-class vessels) and certain  of  its
assets in Guam for approximately $163 million in cash.  One  of
the  ships  was  sold in December 1995, and the remaining  five
vessels  were  sold  in January 1996.  Four of  these  vessels,
together  with a fifth Matson vessel, are currently being  used
in  the alliance.  The net gain on the sale of the four vessels
in  the  alliance  and the Guam assets is estimated  to  be  $2
million,  depending upon final vessel modification and  drydock
costs, and will be deferred and amortized over the 10-year term
of  the alliance.  The net gain on the sale of the fifth vessel
was $2 million and was recognized in the first quarter of 1996.
Matson  is operating the vessels in the alliance, which  serves
the U.S. West Coast, Hawaii, Guam, Korea and Japan, and has the
use  of  substantially all the westbound capacity.  The company
has   the  use  of  substantially  all  the  alliance  vessels'
eastbound capacity.
     
     The  value of vessel space provided by the company to  the
alliances  is  less  than  the  value  of  the  total  capacity
allocated  to it through the alliances, resulting in an  annual
net  cash  payment  from the company to its alliance  partners.
The  amount paid to alliance partners was $51 million in  1996,
and is currently estimated to be $56 million in 1997.

Maritime Regulation and Subsidy

     Under  the  company's ODS agreement with the MarAd,  which
expires  December  31,  1997,  payments  to  the  company  were
approximately $45 million, $62 million and $61 million in 1996,
1995  and  1994, respectively, and were recorded as a reduction
of  expenses.  Subsidy payments in 1996 declined because of the
sale of six U.S. flag vessels to Matson.

<PAGE>
     On  October 8, 1996, the Maritime Security Act of 1996 was
signed  into  law.   This  legislation provides  for  a  9-year
Maritime Security Program administered by MarAd with up to $100
million in payments per annum to be appropriated by Congress on
an  annual  basis.  MSP provides $2.1 million  per  vessel  per
year,  compared  with up to $3.6 million per  vessel  per  year
under ODS, and will expire on October 1, 2005.

     On   January  21,  1997,  the  company  signed   operating
agreements  under MSP for nine ships, including five  C10-class
vessels and four C11-class vessels.  The company has a one-year
period in which to begin the participation of those vessels  in
the  program.  Vessels participating in MSP must be  registered
under  U.S.  flag and manned by U.S. crews and must participate
in  the  Emergency  Preparedness  Program  established  by  the
Maritime   Security   Act,   and   certain   U.S.   citizenship
requirements  are  applicable  to  the  participating  carrier.
Transfers  of operating agreements and substitution of  vessels
are  permitted  under specified circumstances, subject  to  the
prior approval of MarAd.  The operating agreements are one-year
contracts,   which  will  be  automatically   renewed   through
September  30,  2005 subject to available funding.   If  annual
funding is not appropriated by the U.S. Congress, the operating
agreements  may be terminated on 60-days notice by MarAd.   The
agreements may also be terminated by the participating  carrier
on  60-days  notice  at  any time, provided  that  the  carrier
continues to participate in the Emergency Preparedness  Program
and  the vessels continue under U.S. flag registry through  the
end of the then-current fiscal year.

     Due  to  the  enactment  of MSP, the company's  collective
bargaining agreement covering its unlicensed personnel  expired
and  was  renegotiated, and a new agreement  was  reached  with
these unions on December 18, 1996.  The new contract expires in
June  1999.   Existing agreements covering  licensed  personnel
expire in December 1997 and June 1998, and the company has been
engaged  in  discussions  with  the  related  unions  regarding
continuation  of those agreements.  The company  is  unable  to
predict  when  or  whether new agreements may be  reached,  and
labor  disturbances could result which could  have  a  material
adverse impact on the company.
     
     In  1996, legislation was introduced in the U.S. House  of
Representatives  and  the U.S. Senate that would  substantially
modify the Shipping Act.  The Shipping Act, among other things,
provides the company with certain immunity from antitrust  laws
and  requires  the company and other carriers in  U.S.  foreign
commerce to file tariffs publicly.  Although Congress failed to
adopt  this legislation, it may be reintroduced in  1997.   The
legislation  proposed in 1996 contained provisions  that  would
have  been  phased in, would have eliminated government  tariff
filing,  allowed confidential and independent contracts between
shippers  and  ocean  carriers,  strengthened  provisions  that
prohibit  predatory  activities  by  foreign  carriers,   under
limited continuing oversight by the Federal Maritime Commission
or  a successor agency, while continuing the company's existing
antitrust  immunity.  The company is unable to predict  whether
this  or  other  proposed legislation  will  be  introduced  or
enacted,  and  whether any such legislation will contain  terms
similar  to  those proposed in 1996.  Enactment of  legislation
modifying  the  Shipping Act, depending upon its  terms,  could
have  a material impact on the competitive environment in which
the   company  operates  and  on  the  company's   results   of
operations.   The company is unable to predict  the  nature  or
extent of the impact of this legislation, if enacted.

<PAGE>
EXPENSES

Expenses
(In millions)                   1996   Change  1995   Change  1994
 Transportation
  Land                        $  906 (10%)   $1,010    0%   $1,010
  Ocean                          424  (1%)      426   17%      366
  Equipment                      253  (1%)      257    6%      243
 Cargo Handling                  671    9%      615    9%      565
 Sales, General & Administrative 386 (20%)      482  (4%)      502
 Restructuring Charge               (100%)       48  100%
 Other (Income) Expense         (42)(259%)     (11) (31%)     (16)
 Total                        $2,598  (8%)   $2,827    6%   $2,670
 Operating Ratio (1)            96%            96%            96%
(1)Other  (Income)/Expense  and the  Restructuring  Charge  are
   excluded from this calculation.

Land Transportation

     Land  transportation expenses declined from 1995  to  1996
due   primarily   to  the  company's  sale  of   its   domestic
distribution  services segment in May 1996.  Lower conventional
rail  rates  and  lower truck expenses were other  contributing
factors.   Overall land transportation expenses were  unchanged
between  1994  and 1995.  In 1995, conventional  rail  expenses
declined  due  to  lower volumes, but this  was  offset  by  an
increase  in intermodal, rail and truck costs in the  company's
international business.

Ocean Transportation

     Ocean  transportation expenses were lower in 1996 than  in
1995,  due  primarily to the sale of six U.S.-flag  vessels  to
Matson  in  December 1995 and January 1996, and the  return  of
vessels  leased from Lykes Bros. Steamship Co., Inc.  ("Lykes")
to  Lykes during 1996.  These savings were partially offset  by
increased costs related to the six new C11-class vessels, which
were  placed  in service in late-1995 and early-1996.   Subsidy
payments  declined in 1996 as a result of the vessel  sales  to
Matson.  This drop was partially offset by favorable prior-year
subsidy  adjustments.  Depreciation expense rose  between  1995
and 1996 because the new C11s were in service throughout 1996.
     
     Between  1994  and  1995,  ocean  transportation  expenses
increased  due primarily to incremental vessel space  purchased
from  alliance  partners in the Asia-Latin  America  and  Asia-
Europe markets.  Additionally, vessel fuel costs increased  due
to  addition of the five C11-class vessels during 1995  and  an
increase  in fuel prices.  Depreciation expense increased  from
1994  to  1995  due to delivery of five C11-class  vessels  and
other capital spending during 1995.

Transportation Equipment

     Transportation equipment costs declined from 1995 to  1996
due primarily to lower maintenance and repair expenses in North
America,  partially  offset by higher  maintenance  and  repair
costs  in  Asia and increased licensing fees.  Costs  increased
from 1994 to 1995 due to increased container leasing and repair
and maintenance costs.

<PAGE>
Cargo Handling

     Cargo  handling  expenses  rose  from  1995  to  1996  due
primarily  to  higher  stevedoring  costs  in  Asia  and  North
America,  resulting  from  handling  an  increased  volume   of
shipments  and  from  higher labor rates.   This  increase  was
partially offset by the strengthening value of the U.S.  dollar
against  the Japanese yen in 1996.  The exchange rate  averaged
108  yen  to the dollar in 1996 versus 93 yen to the dollar  in
1995.
     
     Cargo handling expenses increased from 1994 to 1995 due to
higher  stevedoring  labor  rates  in  Asia,  increased   cargo
handling volumes in Asia, and start-up of the Europe and  Latin
America  services in 1995.  Another factor was the weakness  of
the   U.S.  dollar  relative  to  the  Japanese  yen  in  1995,
particularly in the first half of the year.
     
Sales, General and Administrative

     In   1996,  sales,  general  and  administrative  ("SG&A")
expenses  declined  substantially from  1995,  as  the  company
realized salary and benefit savings from the 1995 restructuring
which  resulted in the elimination of certain positions in  the
U.S.  and  Asia through the end of 1996.  There was no spending
on  corporate initiatives in 1996, compared with $25 million in
1995.  Other factors were lower agency fees, lower accruals for
certain employee benefit costs due to workforce reductions, and
favorable insurance and other claims experience.
     
     SG&A  expenses  declined in 1995 compared with  1994,  due
primarily  to  lower employee-related and reengineering  costs.
Expenditures for corporate initiatives related to reengineering
were  approximately $25 million for 1995 and  $31  million  for
1994.   The  decline in 1995 was partially  offset  by  a  1995
increase  in agency fees resulting primarily from the company's
entrance  into  the Asia-Europe market, and by higher  employee
relocation  and telecommunication expenses.  Included  in  1994
SG&A  expenses  were  $7 million in land costs  and  commission
expenses from final real estate sales.

Restructuring Charge

      During the fourth quarter of 1995, the company recorded a
pretax  restructuring charge of $48 million for the accelerated
completion of its reegineering program and other organizational
changes.   The  company  has made a total  of  $24  million  in
severance  payments,  and  has  written  off  $12  million   in
equipment, leasehold improvements and other expenses related to
the restructuring.

Other Income and Expense

     In 1996, the company recognized a gain of $11 million from
the  sale  of  certain  cranes in its Los Angeles  and  Oakland
terminals, and $9 million from the sale of residential property
in  Singapore.   The  company  sold its  domestic  distribution
services segment for a gain of $7 million, and a vessel  for  a
gain  of $2 million.  In 1996, the company also recorded a  net
gain  of $13 million from the curtailment of pension and  post-
retirement obligations due to workforce reductions.

<PAGE>     
     In 1995, the company had $6 million of gains from sales of
vessels  and  $5  million in liquidated  damages  from  delayed
vessel  deliveries.  In 1994, Other Income and Expense included
income of $10 million related to the collection of Desert Storm
detention  charges  and  gains of $6  million  from  crane  and
container sales.

Net Interest Expense

      Net interest expense was $37 million in 1996, $15 million
in  1995,  and $13 million in 1994.  The 1996 expense  includes
interest  expense  for the full-year on  debt  related  to  the
purchase  of the C11-class vessels.  This expense was partially
offset  by an increase in interest income resulting from higher
cash balances in 1996 than in 1995.

     The increase between 1994 and 1995 resulted primarily from
interest  expense on the debt related to the purchase  of  C11-
class  vessels  purchased in 1995, partially offset  by  higher
interest income resulting from higher interest rates in 1995.

Income Taxes

     The effective tax rates applicable to the company were 33%
in  1996, 43% in 1995, and 33% in 1994.  The 1996 rate reflects
the availability of additional tax credits and deductions.  The
1995  rate includes the increased effect of nondeductible items
on  lower  income.   The  1994 rate  includes  the  effects  of
revising prior years' estimated tax liabilities.  The effective
tax rate for 1997 is currently expected to be at the same level
or lower than the 1996 rate.  However, the actual rate for 1997
will depend upon the level of actual earnings and upon tax  law
changes, if any, among other factors.

LIQUIDITY AND CAPITAL RESOURCES

Summary of Financial Resources
(In millions)                              1996      1995    1994
 Cash, Cash Equivalents and
   Short-term Investments                 $ 283    $  136   $ 255
 Working Capital                            226        65     206
 Total Assets                             1,880     1,879   1,664
 Long-term Debt and Capital
   Lease Obligations (1)                    706       699     391
 Cash Provided by Operations                125       164     177
Capital Expenditures
 Ships                                    $  72    $  392   $  38
 Containers, Chassis and Rail Cars           24        23      57
 Leasehold Improvements and Other            48        41      33
 Total                                    $ 144    $  456   $ 128
Financing Activities
 Borrowings                               $  62    $  340   $ 147
 Repayment of Debt and Capital Leases      (55)      (32)    (28)
 Common Stock Repurchases                  (29)     (170)
 Dividend Payments                         (10)      (14)    (18)
(1)Includes current and long-term portions.

<PAGE>
Cash Flows

     In  1996, the company generated a total of $125 million in
cash  from operations, compared with $164 million in  1995  and
$177  million in 1994.  The 1996 decline results primarily from
lower  recurring pretax earnings than in prior years.  In 1996,
vessel sales to Matson, the sales of cranes in Los Angeles  and
Oakland,  and  the  sale of residential property  in  Singapore
generated  $199 million in cash.  Substantially  all  of  these
proceeds were used to purchase short-term investments.

Capital Spending

      The  company took delivery of five C11-class  vessels  in
1995  and one C11-class vessel in 1996.  The total cost of  the
six   C11-class  vessels  was  $529  million,  including  total
payments to the shipyards of $503 million, of which $62 million
was paid in January 1996.

      To  finance  a  portion  of these vessel  purchases,  the
company borrowed $402 million.  Of this amount, $62 million was
borrowed  in  January  1996 and the  remainder  in  1995.   The
company has entered into four interest rate swap agreements  to
exchange the variable interest rates on certain vessel mortgage
notes for fixed rates over periods of 7 and 12 years.

      Other 1996 capital expenditures included $48 million  for
leasehold  improvements for the new Los Angeles  terminal,  and
the  remainder were containers and chassis purchases and vessel
modifications.
     
     In  1995,  in  addition  to vessel  expenditures  of  $392
million,  the  company  spent  $64  million  for  purchases  of
chassis,  containers  and terminal and leasehold  improvements.
In  1994,  in  addition  to  vessel progress  payments  of  $31
million,  the  company made capital expenditures  totaling  $97
million  for  purchases  of chassis, vessel  modifications  and
terminal and leasehold improvements.

      Capital expenditures in 1997 are currently expected to be
approximately $150 million, and will be primarily for  terminal
and   leasehold  improvements,  transportation  equipment   and
systems.   The company has outstanding purchase commitments  to
acquire cranes, facilities, equipment and services totaling $85
million.

Share Repurchases and Redemptions

     In  April 1996, the Board of Directors approved a  program
to  repurchase  up  to  an aggregate  of  $50  million  of  the
company's common stock from time to time through open-market or
privately  negotiated transactions.  As of December  27,  1996,
the  company  had paid $29 million to repurchase  approximately
1.3  million shares of its common stock under this program,  as
more  fully  described  in  Note 10 of  Notes  to  Consolidated
Financial Statements.

     In  July  1995,  at  the  election  of  the  holders,  all
1,500,000   shares  of  9%  Series  C  Cumulative   Convertible
Preferred  Stock  ("Series C Preferred Stock")  were  converted
into  3,961,498  shares of common stock,  or  2.641  shares  of
common  stock  for  each share of Series C Preferred  Stock  (a
conversion price of $18.93 per share of common stock).

<PAGE>
     In  1995, the Board of Directors authorized the repurchase
of  up to 6 million shares of the company's common stock.  This
repurchase was completed at prices ranging from $25.81  to  $30
per share, plus expenses.

     All  repurchased shares were retired.  The excess  of  the
purchase  price of the common stock over its stated  value  has
been reflected as a decrease in Additional Paid-In Capital  and
Retained Earnings.

Capital Resources

     The  company has a credit agreement with a group of  banks
which  provides  for an aggregate commitment  of  $200  million
through March 1999.  Under that agreement, the company also has
an option to sell up to $150 million of certain of its accounts
receivable to the banks as an alternative to borrowing.   There
have been no borrowings under this agreement.

     In  January 1994, the company issued $150 million  of  30-
year  Senior Debentures, the proceeds from which were  used  to
finance  vessel purchases, other capital expenditures  and  for
general corporate purposes.

     The  company believes its existing resources,  cash  flows
from  operations  and  borrowing capacity  under  its  existing
credit facilities will be adequate to meet its liquidity  needs
for the foreseeable future.

CERTAIN FACTORS THAT MAY AFFECT OPERATING RESULTS

     Statements   prefaced   with   "expects",   "anticipates",
"estimates",  "believes" and similar words are  forward-looking
statements  based on the company's current expectations  as  to
prospective events, circumstances and conditions over which  it
may  have little or no control and as to which it can  give  no
assurances.   All forward-looking statements, by their  nature,
involve  risks  and  uncertainties, including  those  discussed
above  and  below,  that could cause actual results  to  differ
materially from those projected.

     The  company  expects  that it and the  shipping  industry
generally  will  face challenging conditions in  coming  years.
The  adversity of the operating environment and its  impact  on
the  company's operating results will depend on  a  variety  of
factors,  including:  the timing and extent of  an  anticipated
slowing  of  market  growth in certain markets  served  by  the
company;  the  amount and timing of an anticipated  significant
increase  in industry capacity due to new vessel deliveries  to
competing carriers; rate reductions in some market segments due
to  this  additional  capacity and  other  factors;  successful
implementation  and  continuation of the  company's  alliances,
which  comprise a significant factor in the company's long-term
strategy  to  remain competitive; and the pace  and  degree  of
industry deregulation.
     
     As  a  result of excess capacity, slow market  growth  and
increased competition, considerable rate instability exists  in
most of the company's major markets.  Destabilization of rates,
if  extensive,  could  have a material adverse  impact  on  the
results  of  operations of carriers in these trades,  including
the company.

<PAGE>
     Demand in the trans-Pacific market is dependent on factors
such  as the quantity of available import and export cargo  and
economic  conditions  in  the  U.S.  and  other  Pacific  Basin
countries.   The  degree to which any growth or contraction  in
the  trans-Pacific market impacts the company  will  depend  in
large  part on the introduction of additional vessels into  the
market  by  the  company's competitors.  Because  a  number  of
competing   ocean   carriers  have  placed   orders   for   the
construction  of a significant number of new vessels,  capacity
in  the  trans-Pacific market is expected to grow significantly
more   than   demand,  which  could  result  in  further   rate
reductions.

     Other  risks and uncertainties include: growth  trends  in
other  markets served by the company, the company's ability  to
respond  to  those  trends, changes in the cost  of  fuel,  the
status  of labor relations, the amplitude of recurring seasonal
business  fluctuations, and the continuation and  effectiveness
of  the  Trans-Pacific Stabilization Agreement and the  various
shipping  conferences  to which the company  belongs.   If  the
company  were unable to negotiate acceptable labor  agreements,
the  results  could include work stoppages,  strikes  or  other
labor  difficulties, or higher labor costs, any of which  could
have  a  material  adverse  affect on the  company's  operating
results.   The  company  has experienced such  difficulties  at
times in the past, and can provide no assurance that they  will
not occur in the future.

     Also,  the  company  is  subject  to  inherent  risks   of
conducting  business  internationally,  including  changes  in:
legislative or regulatory requirements, the relative values  of
the  U.S. dollar and the various foreign currencies with  which
the company is paid and funds its local operations, tariffs and
other  trade barriers and restrictions affecting its customers,
payment   cycles,   the   difficulty  of  collecting   accounts
receivable, taxes, and the burdens of complying with a  variety
of   foreign   laws.   In  connection  with  its  international
operations, the company is also subject to general geopolitical
risks,  such as political and economic instability and  changes
in  diplomatic and trade relationships affecting the company or
its customers.
     
     The   company   expressly  disclaims  any  obligation   or
undertaking to update any forward-looking statements  contained
herein in the event of any change in the company's expectations
with  regard  thereto or with regard to current or  prospective
conditions  or  circumstances on which any  such  statement  is
based.
     
     
ITEM  8.    CONSOLIDATED FINANCIAL STATEMENTS  AND  SUPPLEMENTARY
DATA

INDEX TO FINANCIAL STATEMENTS

Report of Management                                        29
Report of Independent Public Accountants                    30
Consolidated Financial Statements
     Statement of Income                                    31
     Balance Sheet                                          32
     Statement of Cash Flows                                33
     Statement of Changes in Stockholders' Equity           34
     Notes to Consolidated Financial Statements          35-54
Financial Statement Schedule
     Schedule II                                            55

<PAGE>     
                      REPORT OF MANAGEMENT

To the Stockholders of APL Limited:

      The  financial  statements  have  been  prepared  by  the
company,  and we are responsible for their content.   They  are
prepared  in  accordance  with  generally  accepted  accounting
principles,  and  in  this regard we have  undertaken  to  make
informed  judgments  and  estimates, where  necessary,  of  the
expected  effect of future events and transactions.  The  other
financial  information in the annual report is consistent  with
that in the consolidated financial statements.

      The  company  maintains  and depends  upon  a  system  of
internal controls designed to provide reasonable assurance that
our  assets are safeguarded, that transactions are executed  in
accordance with management's intent and the law, and  that  the
accounting   records   fairly  and   accurately   reflect   the
transactions of the company.  The company has an internal audit
program which reviews the adequacy of the internal controls and
compliance with them.

      The  company  engaged Arthur Andersen LLP as  independent
public  accountants to provide an objective, independent  audit
of our financial statements.

      There  is  an  Audit Committee of the Board of  Directors
which  is  composed solely of outside directors.  The committee
meets whenever necessary to monitor and review with management,
the  internal  auditors and the independent public accountants,
the  company's  financial statements and  accounting  controls.
Both  the  independent  public  accountants  and  the  internal
auditors have access to the Audit Committee, without management
being  present,  to  discuss internal  controls,  auditing  and
financial reporting matters.

      To  help  assure that its affairs are properly conducted,
management  has  established policies  regarding  standards  of
corporate  behavior.   The company regularly  reminds  its  key
employees of significant policies and requires them to  confirm
their compliance.

/s/ Timothy J. Rhein
Timothy J. Rhein
President and Chief Executive Officer

/s/ L. Dale Crandall
L. Dale Crandall
Executive Vice President and
Chief Financial Officer

/s/ William J. Stuebgen
William J. Stuebgen
Vice President, Controller and
Chief Accounting Officer


Oakland, California
February 7, 1997

<PAGE>
            REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS




To the Stockholders of APL Limited:


      We  have  audited  the accompanying consolidated  balance
sheet  of APL Limited (a Delaware corporation) and subsidiaries
as  of December 27, 1996 and December 29, 1995, and the related
consolidated  statements of income, cash flows and  changes  in
stockholders' equity for each of the three years in the  period
ended   December   27,  1996.   These  consolidated   financial
statements  and  the  schedule  referred  to  below   are   the
responsibility of the company's management.  Our responsibility
is  to  express  an  opinion  on these  consolidated  financial
statements and the schedule based on our audits.

      We  conducted  our  audits in accordance  with  generally
accepted auditing standards.  Those standards require  that  we
plan and perform the audit to obtain reasonable assurance about
whether   the   financial  statements  are  free  of   material
misstatement.   An audit includes examining, on a  test  basis,
evidence  supporting  the  amounts  and  disclosures   in   the
financial  statements.   An audit also includes  assessing  the
accounting  principles used and significant estimates  made  by
management,  as  well  as  evaluating  the  overall   financial
statement  presentation.  We believe that our audits provide  a
reasonable basis for our opinion.

     In our opinion, the financial statements referred to above
present   fairly,  in  all  material  respects,  the  financial
position  of  APL Limited and subsidiaries as of  December  27,
1996 and December 29, 1995, and the results of their operations
and  their cash flows for each of the three years in the period
ended  December 27, 1996, in conformity with generally accepted
accounting principles.

     Our  audit was made for the purpose of forming an  opinion
on  the  basic  financial statements taken  as  a  whole.   The
schedule  listed  in  the  index  to  financial  statements  is
presented  for  purposes of complying with the  Securities  and
Exchange Commission's rules and is not a required part  of  the
basic   financial  statements.   This  information   has   been
subjected  to the auditing procedures applied in our  audit  of
the  basic financial statements and, in our opinion, is  fairly
stated  in  all  material respects in  relation  to  the  basic
financial statements taken as a whole.




/s/ Arthur Andersen LLP



San Francisco, California
February 7, 1997

<PAGE>
APL Limited

CONSOLIDATED STATEMENT OF INCOME
Year Ended                   December 27    December 29  December 30
(In thousands, except               1996           1995         1994
 per share amounts)
Revenues                       $2,739,126    $2,895,982   $2,793,468
Expenses                        2,598,432     2,827,609    2,670,320
Operating Income                  140,694        68,373      123,148

Interest Income                    26,998        23,098       16,150
Interest Expense                  (63,516)      (38,318)     (28,994)
Income Before Taxes               104,176        53,153      110,304
Federal, State and Foreign
 Tax Expense                       34,722        22,856       36,106
Net Income                      $  69,454    $   30,297   $   74,198
Less Dividends on Preferred Stock                 3,375        6,750
Net Income Applicable to
  Common Stock                  $  69,454    $   26,922   $   67,448

Earnings Per Common Share
  Primary                       $    2.67    $     0.95   $      2.38
  Fully Diluted                 $    2.67    $     0.99   $      2.30
Dividends Per Common Share      $    0.40    $     0.40   $      0.40
See notes to consolidated financial statements.

<PAGE>
APL Limited

CONSOLIDATED BALANCE SHEET
                                            December 27  December 29
(In thousands, except share amounts)               1996         1995
ASSETS
Current Assets
Cash and Cash Equivalents                     $ 102,370     $ 76,564
Short-Term Investments                          180,628       59,086
Trade and Other Receivables, Net                242,460      245,490
Fuel and Operating Supplies                      29,220       40,358
Prepaid Expenses and Other Current Assets        61,804       80,840
Total Current Assets                            616,482      502,338
Property and Equipment
Ships                                           903,227    1,091,991
Containers, Chassis and Rail Cars               764,294      801,274
Leasehold Improvements and Other                252,466      284,850
Construction in Progress                         29,078       25,333
                                              1,949,065    2,203,448

Accumulated Depreciation and Amortization     (825,846)    (961,971)
Property and Equipment, Net                   1,123,219    1,241,477
Investments and Other Assets                    140,477      134,968

Total Assets                                 $1,880,178   $1,878,783

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current Portion of Long-Term Debt
  and Capital Leases                          $   9,866   $   11,810
Accounts Payable and Accrued Liabilities        380,690      425,378
Total Current Liabilities                       390,556      437,188
Deferred Income Taxes                           173,867      157,480
Other Liabilities                               116,569      127,858
Long-Term Debt                                  695,546      685,954
Capital Lease Obligations                           801        1,133
Total Long-Term Debt and 
  Capital Lease Obligations                     696,347      687,087

Commitments and Contingencies
Stockholders' Equity
Common Stock $.01 Par Value, Stated at $1.00
  Authorized-60,000,000 Shares
  Shares Issued and Outstanding-24,564,000 in
  1996 and 25,669,000 in 1995                    24,564       25,669
Additional Paid-In Capital                          632        1,943
Retained Earnings                               477,643      441,558
Total Stockholders' Equity                      502,839      469,170

Total Liabilities and Stockholders' Equity   $1,880,178   $1,878,783
See notes to consolidated financial statements.

<PAGE>
APL Limited

CONSOLIDATED STATEMENT OF CASH FLOWS
Year Ended                           December 27December 29December 30
(In thousands)                              1996       1995       1994
Cash Flows from Operating Activities
Net Income                               $69,454   $ 30,297   $ 74,198
Adjustments to Reconcile Net Income to Net
 Cash Provided by Operating Activities:
  Depreciation and Amortization          113,326    112,418    106,274
  Noncash Restructuring Charge                       43,510
  Deferred Income Taxes                   30,160    (13,134)    14,865
  Change in Receivables                   12,001      4,118    (42,216)
  Issuance of Notes Receivable on Sales
   of Real Estate                                               (7,470)
  Change in Fuel and Operating Supplies    7,389     (3,809)    (1,195)
  Change in Prepaid Expenses and Other
   Current Assets                            528     (9,096)     8,335
  Gain on Sale of Property and Equipment (24,102)    (5,660)    (5,583)
  Gain on Sale of Distribution Services   (6,900)
  Change in Accounts Payable and
   Accrued Liabilities                   (20,482)   (11,456)    18,844
  Change in Restructuring Charge
   Liability                             (22,405)
  Gain on Curtailment of Pension and
   Postretirement Benefits               (12,542)
  Other                                  (21,863)    16,921     10,519
  Net Cash Provided by 
   Operating Activities                  124,564    164,109    176,571
Cash Flows from Investing Activities
Capital Expenditures                    (144,278)  (455,721)  (127,757)
Proceeds from Sales of Property
  and Equipment                          197,321     44,937      9,297
Proceeds from Sales of
  Distribution Services                    2,000
Purchase of Short-Term Investments      (505,995)   (99,975)  (453,870)
Proceeds from Sales of
  Short-Term Investments                 384,453    255,787    238,972
Transfer from Capital Construction Fund    5,372
Deposits to Capital Construction Fund     (8,114)
Other                                      1,518      2,261      1,649
  Net Cash Used in Investing Activities  (67,723)  (252,711)  (331,709)
Cash Flows from Financing Activities
Repurchase of Common Stock               (28,953)  (170,364)
Issuance of Debt                          62,215    339,897    147,348
Repayments of Capital Lease Obligations  (11,806)    (3,877)    (3,278)
Repayments of Debt                       (43,290)   (28,357)   (24,897)
Dividends Paid                           (10,168)   (14,359)   (17,651)
Debt Issue Costs                          (1,624)    (4,980)
Other                                      3,336      7,213      9,383
  Net Cash Provided by (Used in)
   Financing Activities                  (30,290)    125,173    110,905
Effect of Exchange Rate Changes on Cash     (745)        239        (66)
  Net Increase (Decrease) in Cash
   and Cash Equivalents                   25,806     36,810     (44,299)
Cash and Cash Equivalents at
  Beginning of Year                       76,564     39,754      84,053
Cash and Cash Equivalents at 
  End of Year                           $102,370   $ 76,564    $ 39,754
See notes to consolidated financial statements.

<PAGE>
APL Limited

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Year Ended                           December 27December 29December 30
(In thousands, except share amounts)        1996       1995       1994
Common Stock
Beginning Balance                        $25,669   $ 27,318   $ 26,837
Stock Awards and Options Exercised, Net      161        390        481
Conversion of Redeemable Preferred Stock              3,962
Repurchase and Retirement of Common Stock (1,266)    (6,001)
 Ending Balance                           24,564     25,669     27,318
Additional Paid-In Capital
Beginning Balance                          1,943     70,853     61,656
Stock Awards and Options Exercised, Net    3,180      6,837      9,197
Conversion of Redeemable Preferred Stock             71,038
Repurchase and Retirement of Common Stock (4,491)  (146,785)
 Ending Balance                              632      1,943     70,853
Retained Earnings
Beginning Balance                        441,558    443,212    386,960
Net Income                                69,454     30,297     74,198
Cash Dividends
 Common                                  (10,168)   (10,984)   (10,901)
 Series C Redeemable Preferred                       (3,375)    (6,750)
Repurchase and Retirement of
  Common Stock                           (23,196)  (17,578)
Other                                         (5)       (14)      (295)
 Ending Balance                          477,643    441,558    443,212
     Total Stockholders' Equity         $502,839   $469,170   $541,383
See notes to consolidated financial statements.

<PAGE>
APL Limited

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.   SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation and Fiscal Year
      In  1996, American President Companies, Ltd. changed  its
name  to  APL  Limited.  The consolidated financial  statements
include  the  accounts  of APL Limited and  its  majority-owned
subsidiaries  (the  "company"), after eliminating  intercompany
accounts and transactions.  The company's fiscal year  ends  on
the last Friday in December.  The company's 1996, 1995 and 1994
fiscal years were 52 weeks.

Nature of Operations
       The   company   provides  transportation  services   for
containerized  cargo  in the trans-Pacific,  intra-Asia,  Asia-
Europe, Asia-Latin America and North American markets.  Certain
of  the  services  are  provided through alliances  with  other
transportation  companies.  In addition, the  company  provides
cargo  distribution and warehousing services in  the  U.S.  and
freight  consolidation  services in Mexico,  Asia,  the  Middle
East,  Europe  and  Africa.  The company also provides  freight
deconsolidation services in several U.S. locations and acts  as
a  non-vessel operating common carrier in the intra-Asia market
and the markets from Asia to Europe and Australia.  The company
provides   intermodal  transportation  and  freight   brokerage
services to North American and international shippers, as  well
as time-critical cargo transportation and just-in-time delivery
(principally to the automotive manufacturing industry).   These
services are provided through an integrated system of rail  and
truck  transportation, the primary element of  which  is  train
services  provided  utilizing  double-stack  rail  cars.    The
operations of the company in any one country, type of cargo  or
customer  are  not  significant in relation  to  the  company's
overall operations.

Certain Significant Risks and Uncertainties
      As  a  result of excess capacity, slow market growth  and
increased competition, considerable rate instability exists  in
most of the company's major markets.  Destabilization of rates,
if  extensive,  could  have a material adverse  impact  on  the
results  of  operations of carriers in these trades,  including
the company.

Preparation of Financial Statements
     The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of  assets  and  liabilities  at  the  date  of  the  financial
statements  and the reported amounts of revenues  and  expenses
during the reporting period.  Actual results could differ  from
those estimates.

Revenues and Expenses
      The  company  recognizes  revenues  on  a  percentage-of-
completion  basis and expenses as incurred.  Detention  revenue
is recognized when cash is received.

<PAGE>
Sales, General and Administrative Expenses
      Sales,  General and Administrative Expense,  included  in
Expenses on the accompanying Consolidated Statement of  Income,
was  $386.3 million, $482.1 million and $502.5 million in 1996,
1995 and 1994, respectively.

Foreign Currency Transactions
      The  company's  functional currency is the  U.S.  dollar.
Foreign  entities translate monetary assets and liabilities  at
period-end   exchange   rates  while  nonmonetary   items   are
translated  at  historical rates.  Income and expense  accounts
are  translated at the average rates in effect during the year.
Net  gains  or  (losses)  from changes in  exchange  rates  are
included in Expenses on the accompanying Consolidated Statement
of  Income  and  for 1996, 1995 and 1994 were  $(1.5)  million,
$(1.7) million, and $0.5 million, respectively.

      The  company  periodically enters into contracts  to  buy
foreign currencies in the future to hedge the impact of foreign
currency  fluctuations on certain operating  commitments.   The
gains  or losses on these contracts are deferred and recognized
when  the  related  operating expenses are  incurred,  and  are
recorded  as  a  decrease  or  increase  in  Expense   on   the
accompanying Consolidated Statement of Income.

Cash, Cash Equivalents and Short-Term Investments
      Cash  and  Cash  Equivalents comprise cash  balances  and
investments with maturities of three months or less at the time
of  purchase.   Short-Term Investments  consist  of  commercial
paper,  auction rate preferred stock and other cash instruments
and  are  carried  at  cost,  which  approximates  fair  value.
Included in Cash and Cash Equivalents at December 27,  1996  is
$15.8  million  held  in  trust  and  restricted  for  use   in
purchasing certain terminal equipment.

Supplemental  Disclosure of Cash Flow Information  and  Noncash
Investing and Financing Activities
(In thousands)                           1996       1995       1994
Cash Paid for:
 Interest, Net of 
  Capitalized Interest                $62,865     $34,570    $24,158
 Income Taxes, Net of Refunds         $21,859     $31,459    $15,848
Noncash Items:
 Notes Receivable from the Sale
  of Distribution Services            $ 6,000
 Change in Trade Receivables Invested in
  the Capital Construction Fund       $(1,998)    $27,178    $37,773
 Conversion of Redeemable Preferred Stock         $75,000

Allowance for Doubtful Accounts
      The provision for doubtful accounts, included in Expenses
on the accompanying Consolidated Statement of Income, for 1996,
1995  and  1994  was  $6.1  million, $14.9  million  and  $13.2
million,  respectively.  At December 27, 1996 and December  29,
1995,  the allowance for doubtful accounts, included  in  Trade
and  Other Receivables on the accompanying Consolidated Balance
Sheet, was $19.8 million and $22.5 million, respectively.

Property and Equipment
      Property  and Equipment are recorded at historical  cost.
For assets financed under capital leases, the present value  of
the  future minimum lease payments is recorded at the  date  of
acquisition        as       Property       and        Equipment

<PAGE>
with  a  corresponding  amount  recorded  as  a  capital  lease
obligation.   Depreciation and amortization are computed  using
the  straight-line  method based upon the  following  estimated
useful lives:

Classification                            Estimated Useful Life
Ships                                            15 to 25 Years
Containers, Chassis and Accessories               5 to 20 Years
Rail Cars                                         5 to 10 Years
Other Property and Equipment                            Various
Assets Under Capital Lease Arrangements           Term of Lease

       Depreciation  and  amortization  expense,  included   in
Expenses on the accompanying Consolidated Statement of  Income,
was  $113.3 million, $112.4 million and $106.3 million in 1996,
1995 and 1994, respectively.

      During  1996, the company recorded gains of $11.5 million
and  $9.2  million  from the sale of certain  cranes  from  its
terminals in Los Angeles and Oakland, and residential  property
in  Singapore, respectively.  The company is obligated to enter
into  agreements with third parties regarding movement  of  its
Oakland port facilities prior to a specified date.  If no  such
agreement  is  reached,  the  company  would  be  obligated  to
repurchase the Oakland cranes or pay increased rates for  their
use.

      Maintenance  and repair expenditures of  $118.0  million,
$126.3 million and $117.3 million were included in Expenses  on
the accompanying Consolidated Statement of Income in 1996, 1995
and  1994, respectively, as incurred.  At December 27, 1996 and
December  29,  1995, the balance of deferred  costs  for  major
periodic  dry  dockings  and  rail  car  overhauls,  which  are
amortized  over two to five years, was $10.8 million  and  $6.3
million,  respectively,  and was included  in  Investments  and
Other Assets on the accompanying Consolidated Balance Sheet.

Long-Term Investments
      The  company has certain investments, long-term  deposits
and  receivables, which are included in Investments  and  Other
Assets  on  the accompanying Consolidated Balance  Sheet.   The
fair value of these assets approximates their carrying value at
December 27, 1996.

Software Costs
     Costs related to internally developed software are charged
to expense as incurred.  Purchases of major integrated software
systems  are  capitalized and amortized using the straight-line
method over five years.

Capitalized Interest
      Interest costs of $0.9 million relating to cash paid  for
construction of port facilities were capitalized in  1996.   In
addition,  interest  costs  of $8.4 million  and  $6.3  million
relating primarily to cash paid for the construction of vessels
were capitalized in 1995 and 1994, respectively.

Insurance Reserves
      The company is self-insured for a significant portion  of
its  cargo,  vessel, and personal injury exposures.   Insurance
reserves  are  determined  using  actuarial  estimates.   These
estimates  are  based  on  historical  information  along  with
certain assumptions about future events.

<PAGE>
Reclassifications
     Certain  1995  and 1994 amounts have been reclassified  to
conform with the 1996 presentation.


NOTE 2.   UNITED STATES MARITIME AGREEMENTS AND LEGISLATION

Operating-Differential Subsidy Agreement
      The  company  and MarAd are parties to an  ODS  agreement
expiring December 31, 1997, which provides for payment  by  the
U.S.  government  to partially compensate the company  for  the
relatively  greater  labor expense of  vessel  operation  under
United  States  registry.  The ODS amounts for 1996,  1995  and
1994  were  $44.7  million, $61.5 million  and  $60.8  million,
respectively,  and  have  been  included  as  a  reduction   of
expenses.  The reduction in subsidy in 1996 reflects  the  sale
by  the  company of six U.S.-flag vessels to Matson in December
1995 and January 1996 as discussed in Note 11.

      On October 8, 1996, the Maritime Security Act of 1996 was
signed  into  law.   This  legislation provides  for  a  9-year
Maritime Security Program administered by MarAd with up to $100
million in payments per annum to be appropriated by Congress on
an  annual  basis.  MSP provides $2.1 million  per  vessel  per
year,  compared  with up to $3.6 million per  vessel  per  year
under ODS, and will expire on October 1, 2005.

       On  January  21,  1997,  the  company  signed  operating
agreements  under MSP for nine ships, including five  C10-class
vessels and four C11-class vessels.  The company has a one-year
period in which to begin the participation of those vessels  in
the  program.  Vessels participating in MSP must be  registered
under  U.S.  flag and manned by U.S. crews and must participate
in  the  Emergency  Preparedness  Program  established  by  the
Maritime   Security   Act,   and   certain   U.S.   citizenship
requirements  are  applicable  to  the  participating  carrier.
Transfers  of operating agreements and substitution of  vessels
are  permitted  under specified circumstances, subject  to  the
prior approval of MarAd.  The operating agreements are one-year
contracts,   which  will  be  automatically   renewed   through
September  30,  2005 subject to available funding.   If  annual
funding is not appropriated by the U.S. Congress, the operating
agreements  may be terminated on 60-days notice by MarAd.   The
agreements may also be terminated by the participating  carrier
on  60-days  notice  at  any time, provided  that  the  carrier
continues to participate in the Emergency Preparedness  Program
and  the vessels continue under U.S. flag registry through  the
end of the then-current fiscal year.

      Due  to  the  enactment of MSP, the company's  collective
bargaining agreement covering its unlicensed personnel  expired
and  was  renegotiated, and a new agreement  was  reached  with
these unions on December 18, 1996.  The new contract expires in
June  1999.   Existing agreements covering  licensed  personnel
expire in December 1997 and June 1998, and the company has been
engaged  in  discussions  with  the  related  unions  regarding
continuation  of those agreements.  The company  is  unable  to
predict  when  or  whether new agreements may be  reached,  and
labor  disturbances could result which could  have  a  material
adverse impact on the company.

<PAGE>
Capital Construction Fund
      The company also has an agreement with MarAd pursuant  to
which  the company has established a Capital Construction  Fund
("CCF")  to  which the company makes contributions  to  provide
funding  for the acquisition of certain U.S.-built  assets  and
for  the repayment of certain vessel acquisition debt.  The CCF
is included in Investments and Other Assets on the accompanying
Consolidated  Balance  Sheet, and  at  December  27,  1996  and
December  29,  1995, totaled $65.7 million and  $65.0  million,
respectively,  which were primarily invested in  the  company's
trade accounts receivable.

      The  company receives a federal income tax deduction  for
deposits  made  to  the  CCF, subject to certain  restrictions.
Withdrawals from the CCF for investment in vessels  or  related
assets  do  not  give rise to a tax liability, but  reduce  the
depreciable  bases of the assets for income tax  purposes.   At
December 27, 1996, the total tax basis of assets purchased with
CCF  funds was approximately $43.3 million less than  net  book
value.   Deferred income taxes have been provided  for  amounts
held  by  the  CCF and for such qualified amounts  invested  in
vessels or related equipment.

Shipping Act of 1984
      In 1996, legislation was introduced in the U.S. House  of
Representatives  and  the U.S. Senate that would  substantially
modify the Shipping Act.  The Shipping Act, among other things,
provides the company with certain immunity from antitrust  laws
and  requires  the company and other carriers in  U.S.  foreign
commerce to file tariffs publicly.  Although Congress failed to
adopt  this legislation, it may be reintroduced in  1997.   The
legislation  proposed in 1996 contained provisions  that  would
have  been  phased in, would have eliminated government  tariff
filing,  allowed confidential and independent contracts between
shippers  and  ocean  carriers,  strengthened  provisions  that
prohibit  predatory  activities  by  foreign  carriers,   under
limited continuing oversight by the Federal Maritime Commission
or  a successor agency, while continuing the company's existing
antitrust  immunity.  The company is unable to predict  whether
this  or  other  proposed legislation  will  be  introduced  or
enacted,  and  whether any such legislation will contain  terms
similar  to  those proposed in 1996.  Enactment of  legislation
modifying  the  Shipping Act, depending upon its  terms,  could
have  a material impact on the competitive environment in which
the   company  operates  and  on  the  company's   results   of
operations.   The company is unable to predict  the  nature  or
extent of the impact of this legislation, if enacted.


NOTE 3.   RESTRUCTURING CHARGE

      During the fourth quarter of 1995, the company recorded a
restructuring   charge  of  $48.4  million   related   to   the
accelerated completion of its reengineering program  and  other
organizational  changes.   The charge  included  $36.4  million
related  to  the  elimination of certain positions  in  company
operations that were being reorganized or reduced in size.  The
activity for the years ended December 29, 1995 and December 27,
1996 is as follows:

<PAGE>
(In thousands)
1995 Restructuring Charge             $48,372
1995 Activity
 Severance Payments                   (4,862)
 Equipment and Leasehold Write-offs   (4,645)
Balance at December 29, 1995          $38,865
1996 Activity
 Severance Payments                  (19,323)
 Lease Termination Payments           (2,260)
 Equipment and Other Asset Write-offs (5,323)
Balance at December 27, 1996          $11,959


NOTE 4.   INCOME TAXES

      The  company  records  income taxes  in  accordance  with
Statement   of   Financial  Accounting   Standards   No.   109,
"Accounting  for Income Taxes", which requires the  company  to
compute  deferred taxes based upon the amount of taxes  payable
in  future years, after considering known changes in tax  rates
and  other statutory provisions that will be in effect in those
years.

      The reconciliation of the company's effective tax rate to
the federal statutory tax rate is as follows:

                                         1996       1995       1994
U.S. Federal Statutory Rate               35%        35%        35%
Increases (Decreases) in Rate Resulting from:
 State Taxes, Net of Federal Benefit       2%         3%         3%
 Revisions of Prior Years' Tax Estimates                        (6%)
 Permanent Book/Tax Differences and Other (4%)        5%         1%
Net Effective Tax Rate                    33%        43%        33%

      The following is a summary of the company's provision for
income taxes:

(In thousands)                           1996       1995       1994
Current
 Federal                              $(3,366)   $24,798    $20,441
 State                                  1,873      2,455      2,865
 Foreign                                9,557      8,008      6,746
                                        8,064     35,261     30,052
Deferred
 Federal                               25,409    (11,108)     5,358
 State                                  1,249     (1,297)       696
                                       26,658    (12,405)     6,054
Total Provision                       $34,722    $22,856    $36,106

<PAGE>
      The following table shows the tax effect of the company's
cumulative temporary differences and carryforwards included  on
the  company's Consolidated Balance Sheet at December 27,  1996
and December 29, 1995:

(In thousands)                                       1996       1995
Excess  of Tax Over Book Depreciation
  and Deductions                               $(198,846)  $(196,071)
Pension and Postretirement Benefits                17,362     23,297
Excess Insurance Reserves Over Claims Paid         16,497     18,566
Allowance for Doubtful Accounts                     6,627      8,998
Restructuring Charge Accrual                        4,353     16,379
Accrued Liabilities                                 3,493      6,024
Other                                               4,247      6,700
Total Net Deferred Tax Liability                $(146,267) $(116,107)

     The company has federal alternative minimum tax credits of
$2.9 million at December 27, 1996, which do not expire.

      The  amount  of  deferred tax assets and  liabilities  at
December 27, 1996 and December 29, 1995 were as follows:

(In thousands)                                       1996       1995
Deferred Tax Assets                             $  62,569   $ 85,032
Deferred Tax Liabilities                         (208,836)  (201,139)
Total Net Deferred Tax Liability                 (146,267)  (116,107)
Less Net Current Deferred Tax Asset               (27,600)   (41,373)
Deferred Income Taxes                           $(173,867) $(157,480)

      The net current deferred tax asset is included in Prepaid
Expenses   and   Other  Current  Assets  on  the   accompanying
Consolidated Balance Sheet.


NOTE 5.   ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

      Accounts Payable and Accrued Liabilities at December  27,
1996 and December 29, 1995 were as follows:

(In thousands)                                       1996       1995
Accounts Payable                                $  52,316   $ 58,144
Accrued Liabilities                               250,523    243,228
Current Portion of Insurance Claims                15,326     19,564
Income Taxes                                                   5,855
Unearned Revenue                                   50,566     59,722
Restructuring Charge                               11,959     38,865
Total Accounts Payable and Accrued Liabilities  $ 380,690   $425,378


<PAGE>
NOTE 6.   LONG-TERM DEBT

      Long-term debt at December 27, 1996 and December 29, 1995
consisted of the following:

(In thousands)                                       1996       1995
Vessel Mortgage Notes Due Through 2008 (1)      $ 380,880   $338,044
8% Senior Debentures $150 Million Face Amount,
 Due on January 15, 2024 (2)                      147,198    147,169
7 1/8% Senior Notes $150 Million Face Amount,
 Due on November 15, 2003 (2)                     148,399    148,227
Series I 8% Vessel Mortgage Bonds,
 Due Through 1997 (3)                               9,530     33,353
8% Refunding Revenue Bonds, Due on
 November 1, 2009 (4)                              12,000     12,000
Other                                               7,069      7,161
Total Debt                                        705,076    685,954
Current Portion                                    (9,530)
Long-Term Debt                                  $ 695,546   $685,954

(1)The company has taken delivery of six new C11-class vessels.
   To finance a portion of the purchase price of these vessels,
   the  company  borrowed  $339.9 million  in  1995  and  $62.2
   million  in 1996 under a loan agreement with European  banks
   pursuant   to  vessel  mortgage  notes  due  through   2008.
   Principal payments are due in semiannual installments over a
   12-year  period commencing six months after the delivery  of
   the respective vessels.  The interest rates on the notes are
   based upon various margins over LIBOR or the banks' cost  of
   funds,   as  elected  by  the  company.   Until  the   sixth
   anniversary of the delivery date, the company may  defer  up
   to four principal payments.  Aggregate deferred payments are
   due at the end of the term of the notes.  Principal payments
   on  this debt are classified as long-term on the basis  that
   the  company has the ability to defer at least two payments.
   The   notes   issued   under   this   loan   agreement   are
   collateralized  by the C11-class vessels, which  had  a  net
   book value of $503.0 million at December 27, 1996.  Carrying
   value  of the vessel mortgage notes approximates fair  value
   because  the interest rates on outstanding notes approximate
   current  interest rates that would be offered to the company
   for similar debt.
   
   The  company  entered into interest rate swap agreements  on
   four  of  the vessel mortgage notes, with a notional  amount
   of  $261.3  million at December 27, 1996,  to  exchange  the
   variable  interest rate obligations on such notes for  fixed
   rate  obligations  for  periods ranging  between  7  and  12
   years.   The current variable interest rates for all of  the
   vessel mortgage notes range between 6.415% and 6.86%.  As  a
   result  of  the  swaps, the effective interest  rates  range
   between  6.625%  and 7.531% for the first five  years  after
   inception, and 6.625% and 7.656% for the remaining terms  of
   the  swaps.   Net payments or receipts under the  agreements
   are  included in interest expense.  The company  is  exposed
   to    credit   losses   in   the   event   of   counterparty
   nonperformance, but does not currently anticipate  any  such
   losses.    Based   on   quoted  dealer   prices,   immediate
   termination  of the interest rate swaps would  result  in  a
   gain of approximately $4.2 million at December 27, 1996.

<PAGE>
(2)The  company  issued  7  1/8% Senior  Notes  and  8%  Senior
   Debentures  in November 1993 and January 1994, respectively.
   Interest  payments are due semiannually.  The  Senior  Notes
   had an effective interest rate of 7.325%, and an unamortized
   discount  of  $1.6 million and $1.8 million at December  27,
   1996  and  December  29,  1995,  respectively.   The  Senior
   Debentures had an effective interest rate of 8.172%, and  an
   unamortized  discount of $2.8 million at December  27,  1996
   and  December 29, 1995.  Fair value of the Senior Notes  and
   Senior  Debentures was approximately $151 million  and  $147
   million, respectively, at December 27, 1996 based on  quoted
   dealer prices for similar issues.

(3)  Principal payments on each of the company's Series I Vessel
   Mortgage Bonds are due in equal semiannual installments of $2.4
   million.   The  bonds issued under this loan  agreement  are
   collateralized by the five C10-class vessels, which had a net
   book value of $162.8 million at December 27, 1996.  Fair value of
   this debt is approximately $9.6 million at December 27, 1996.

(4)The  Bonds are redeemable on or after November 1, 1999 at  a
   redemption  price of 102% of the principal amount,  reducing
   to  100%  of  the principal amount on or after  November  1,
   2001.   Carrying value of the Bonds approximates fair  value
   because  the  interest rates on outstanding debt approximate
   current  interest rates that would be offered to the company
   for similar debt.

      Principal payments scheduled on long-term debt during the
next five years, assuming the company exercises its options  to
defer payments on the Vessel Mortgage Notes, are as follows:

         (In thousands)
          1997                            $  9,530
          1998                              11,382
          1999                              26,623
          2000                              28,762
          2001                              31,182

      The  company has a credit agreement with a group of banks
which  provides  for an aggregate commitment  of  $200  million
through March 1999.  The credit agreement contains, among other
things, various financial covenants that require the company to
meet  certain  levels  of interest and fixed  charge  coverage,
leverage and net worth.  The borrowings bear interest at  rates
based  upon  various indices as elected by the company.   There
have been no borrowings under this agreement.

     As an alternative to borrowing under its credit agreement,
the  company has an option under that agreement to sell  up  to
$150  million  of  certain of its accounts  receivable  to  the
banks.    This  alternative  is  subject  to  less  restrictive
financial covenants than the borrowing option.


<PAGE>
NOTE 7.   LEASES

     The company leases equipment under capital leases expiring
in four years.  Assets under capital lease included in Property
and Equipment on the accompanying Consolidated Balance Sheet at
December 27, 1996 and December 29, 1995 are as follows:

(In thousands)                                      1996        1995
Containers, Chassis and Rail Cars              $   3,266    $ 37,982
Other Property and Equipment                         938         938
                                                   4,204      38,920
Accumulated Depreciation                          (3,513)    (36,578)
Total                                          $     691    $  2,342

      The  following  is  a  schedule of future  minimum  lease
payments required under the company's leases that have  initial
noncancelable terms in excess of one year at December 27, 1996:

                                              Capital      Operating
(In thousands)                                 Leases         Leases
1997                                         $    414       $219,204
1998                                              414        113,547
1999                                              413        107,526
2000                                               45         90,922
2001                                                          75,176
Later Years                                                1,405,956
Total Minimum Payments Required              $  1,286       $2,012,331
Amount Representing Interest                     (149)
Present Value of Minimum Lease Payments         1,137
Current Portion                                  (336)
Long-Term Portion                            $    801

      The  above schedule of operating leases includes  minimum
payments  under 30 year leases for terminal facilities  in  Los
Angeles   and  Seattle,  which  are  currently  scheduled   for
occupancy upon completion of construction in 1997.

      Total  rental expense for operating leases and short-term
rentals  was $319.7 million, $328.2 million and $334.3  million
in 1996, 1995 and 1994, respectively.


NOTE 8.   EMPLOYEE BENEFIT PLANS

Pension Plans
      The  company  has defined benefit pension plans  covering
most of its employees, which generally call for benefits to  be
paid  to  eligible employees at retirement based  on  years  of
credited  service and average monthly compensation  during  the
five  years  of employment with the highest rate of  pay.   The
company's  general policy is to fund pension costs at  no  less
than  the  statutory requirement.  Certain non-qualified  plans
are  secured through a grantor trust.  The investment  in  this
trust at December 27, 1996 was $18.0 million and is included in
Investments  and Other Assets on the accompanying  Consolidated
Balance  Sheet.  The investments in the trust consist  of  life
insurance  policies  and  other  cash  instruments,  which  are
carried at fair value.

<PAGE>
      The  following table sets forth the pension plans' funded
status  and amounts recognized in the accompanying Consolidated
Balance Sheet at December 27, 1996 and December 29, 1995:

                                     1996                1995
                              Assets in Accumulated Assets in Accumulated
                              Excess of    Benefits  Excess of   Benefits
                              Accumulated in Excess Accumulated in Excess
(In thousands)                Benefits    of Assets Benefits    of Assets
Actuarial Present Value of:
  Vested Benefit Obligation   $(118,660)  $(10,334)  $(108,061) $(10,149)
  Accumulated Benefit
   Obligation                  (124,557)   (10,547)   (116,458)  (10,932)
Actuarial Present Value of
  Projected Benefit
   Obligation                 $(143,512)  $(17,346)  $(161,224) $(17,922)
Plan Assets at Fair Value       167,859                152,169       765
Funded Status                    24,347    (17,346)     (9,055)  (17,157)
Unrecognized Net Loss (Gain)     (7,588)       684      10,438       330
Unrecognized Prior Service
 (Credit) Cost                  (16,402)     2,613     (14,998)    3,528
Unrecognized Transition
 (Asset) Obligation             (13,139)   (2,050)    (8,850)        829
Net Pension Liability          $(12,782) $(16,099)  $(22,465)   $(12,470)

      The  following  assumptions were made in determining  the
company's net pension liability:

(Weighted Average of All Plans)           1996      1995        1994
Discount Rate                             7.9%      7.5%        7.9%
Rate of Increase in Compensation Levels   5.3%      5.2%        5.2%
Expected Long-Term Rate of Return
 on Plan Assets                           8.2%      8.2%        8.2%

     Net pension cost related to the company's pension plans
included the following components:

(In thousands)                            1996       1995       1994
Service Cost                          $  9,272    $ 8,333    $ 9,144
Interest Cost on Projected
 Benefit Obligation                     13,604     12,357     11,228
Actual Return on Plan Assets           (19,649)   (25,019)       414
Net Amortization and Deferral            5,106     12,648    (12,971)
Net Pension Cost                      $  8,333    $ 8,319    $ 7,815

      During  1996,  the company recorded a net gain  of  $10.9
million  related to its defined benefit pension  plans  in  the
U.S.,  Hong  Kong  and Japan.  These gains  resulted  from  net
decreases  in  pension liabilities for employees who  left  the
company  in  1995  and  1996  as  a  result  of  the  company's
restructuring, which is discussed in Note 3.

      The  company also participates in collectively bargained,
multi-employer plans that provide pension and other benefits to
certain  union employees.  The company contributed $4.2 million
in 1996, $5.8 million in 1995, and $5.3 million in 1994 to such
plans.             These           contributions            are

<PAGE>
determined  in  accordance  with the provisions  of  negotiated
labor  contracts and generally are based on the number of hours
worked  and  are  expensed as incurred.  Under certain  of  the
multi-employer pension plans in which the company participates,
the  company  has  withdrawal liabilities of $6.7  million  for
unfunded  vested  benefits at December  31,  1995,  the  latest
valuation  date.  However, the company has no present intention
of  withdrawing  from  the  plans, nor  has  the  company  been
informed  that there is any intention to terminate  the  plans.
There   are   no   other  significant  withdrawal   liabilities
attributable to the company for multi-employer pension plans.

Postretirement Benefits Other than Pensions
      The  company shares the cost of its health care  benefits
with  the  majority of its domestic shoreside retired employees
and  recognizes  the cost of providing health  care  and  other
benefits to retirees over the term of employee service.  During
1996,  the  company  recorded a gain of $1.7 million  resulting
from  the  curtailment  of postretirement  obligations  due  to
workforce   reductions   as   a   result   of   the   company's
restructuring, which is discussed in Note 3.

       Postretirement   benefit  costs  in   the   accompanying
Consolidated Statement of Income were as follows:

(In thousands)                            1996       1995       1994
Interest Cost                         $  1,289    $ 1,266    $ 1,380
Service Cost                               928        795      1,117
Amortization of Gains                     (471)      (477)      (117)
Total Postretirement Benefit Cost     $  1,746    $ 1,584    $ 2,380

      The following table sets forth the postretirement benefit
obligation recognized in the accompanying Consolidated  Balance
Sheet at December 27, 1996 and December 29, 1995:

(In thousands)                                     1996    1995
Accumulated Postretirement Benefit Obligation
Retirees                                        $ 7,385 $ 7,489
Active Employees - Fully Eligible                   371     604
Active Employees - Not Fully Eligible             4,424   8,483
Unrecognized Net Gain                             8,499   7,505
Unamortized Prior Service Cost                    4,560   1,834
Total                                           $25,239 $25,915

     The expected cost of the company's postretirement benefits
is assumed to increase at an annual rate of 8.2% in 1996.  This
rate  is assumed to decline approximately 1% per year to 5%  in
the  year  1999 and remain level thereafter.  The  health  care
cost  trend  rate assumption has a significant  impact  on  the
amounts  reported.  An increase in the rate of 1% in each  year
would   increase   the   accumulated   postretirement   benefit
obligation  at  December  27, 1996  by  $1.0  million  and  the
aggregate  of  the service and interest cost for 1996  by  $0.1
million.   The weighted average discount rate used to determine
the  accumulated  postretirement benefit obligation  was  8.0%.
The company has not funded the liability for these benefits.

<PAGE>
Profit-Sharing Plans
      The company has defined contribution profit-sharing plans
covering certain non-union employees.  Under the terms of these
plans,  the  company has agreed to make matching  contributions
equal  to  those made by the participating employees  up  to  a
maximum  of  6%  of  each  employee's base  salary.   Effective
January  1,  1997,  the base company matching contribution  for
active  employees will be $0.75 for each dollar contributed  up
to  6%  of  each  employee's base salary.  Additional  matching
contributions,  up  to $0.50 for each dollar  contributed,  may
also be made if the company achieves certain financial results.
The company's total contributions to the plans amounted to $5.1
million for 1996 and $6.3 million for 1995 and 1994.


NOTE 9.   REDEEMABLE PREFERRED STOCK

      In  July  1995,  at  the election  of  the  holders,  all
1,500,000  shares  of Series C Preferred Stock  were  converted
into  3,961,498  shares of common stock,  or  2.641  shares  of
common  stock  for  each share of Series C Preferred  Stock  (a
conversion price of $18.93 per share of common stock).


NOTE 10.  STOCKHOLDERS' EQUITY

Common Stock Repurchase
      In  April 1996, the Board of Directors approved a program
to  repurchase  up  to  an aggregate  of  $50  million  of  the
company's   common  stock  through  open  market  or  privately
negotiated  transactions.  During 1996, the company repurchased
1,266,100  shares  of its common stock under this  program  for
$29.0  million  at an average price of $22.82 per  share,  plus
expenses.

      In 1995, the Board of Directors authorized the repurchase
of  up to 6 million shares of the company's common stock.  This
repurchase was completed at prices ranging from $25.81  to  $30
per share, plus expenses.

      All  repurchased shares were retired.  The excess of  the
purchase  price of the common stock over its stated  value  has
been reflected as a decrease in Additional Paid-In Capital  and
Retained  Earnings  on  the accompanying  Consolidated  Balance
Sheet.

Earnings Per Common Share
      For  1996, primary and fully diluted earnings per  common
share  were  computed by dividing net income  by  the  weighted
average  number  of common shares and common equivalent  shares
outstanding  during  the  year.  For  1995  and  1994,  primary
earnings per common share were computed by dividing net income,
reduced  by  the  amount of preferred stock dividends,  by  the
weighted  average number of common shares and common equivalent
shares outstanding during the year.  Fully diluted earnings per
common  share  for  1995 and 1994 were computed  based  on  the
assumption  that the Series C Preferred Stock was converted  at
the beginning of the year.  Common equivalent shares consist of
stock options granted and premium stock bonus plan shares.  The
number of shares used in these computations was as follows:

<PAGE>
Weighted Average Number of Common and Common Equivalent Shares
(In millions)                                   1996    1995    1994
Primary                                         26.0    28.2    28.3
Fully Diluted                                   26.1    30.6    32.3

Stockholder Rights Plan
      The  company's stockholder rights agreement provides that
rights become exercisable when a person acquires 20% or more of
the  company's common stock or announces a tender  offer  which
would  result in the ownership of 20% or more of the  company's
common stock, or if a person who has been declared "adverse" by
the  independent directors of the company exceeds  a  threshold
stock ownership established by the Board, which may not be less
than  10%.   The  rights will be attached to all common  stock.
Once  exercisable, each right entitles its holder  to  purchase
two  one-hundredths  of a share ("unit")  of  Series  A  Junior
Participating Preferred Stock at a purchase price of  $130  per
unit, subject to adjustment.

      Upon  the  occurrence of certain other events related  to
changes  in  the ownership of the company's outstanding  common
stock,  each  holder of a right would be entitled  to  purchase
shares   of   the  company's  common  stock  or  an   acquiring
corporation's common stock having a market value of  two  times
the  exercise  value of the right.  Rights that are,  or  were,
beneficially  owned by an acquiring or adverse person  will  be
null  and  void.  In addition, the Board of Directors  may,  in
certain circumstances, require the exchange of each outstanding
right  for  common stock or other consideration  with  a  value
equal  to  the exercise price of the rights.  The  company  has
reserved   500,000  shares  of  preferred  stock  for  issuance
pursuant  to  the  exercise of the rights in the  future.   The
rights  expire  November  29,  1998  and,  subject  to  certain
conditions,  may be redeemed by the Board of Directors  at  any
time at a price of $0.025 per right.

Stock Incentive Plans
      The  Compensation  Committee of the  Board  of  Directors
approved  stock  option grants under the company's  1989  Stock
Incentive Plan (the "Plan") for shares of the company's  common
stock  beginning in July 1993 to key employees of the  company.
The  options have an exercise price of the greater of the  fair
market  value on the date of grant or $22.38 per share, a  term
expiring  July  26, 2003 and vest between 1996 and  2002  based
upon the achievement of stock price appreciation targets.   The
percentage  of  the  options that vest  during  specified  time
periods  will  depend on the amount of stock price appreciation
in  those time periods.  In 1998, the options will vest  as  to
60% of the covered shares if not otherwise vested, and in 2002,
the  options will vest as to the remaining 40% if not otherwise
vested.   Previous stock option grants under  the  Plan  become
exercisable   in  three  to  four  equal  annual   installments
commencing one year after grant.

      The  1992  Directors Stock Option Plan provides  for  the
granting of options to purchase shares of common stock to  non-
employee  members  of the company's Board  of  Directors.   The
aggregate  number  of options which may be granted  under  this
plan  is  200,000.  Options become exercisable in  three  equal
installments on the first three anniversaries of  the  date  of
grant.

      In October 1995, the Financial Accounting Standards Board
issued  Statement  of Financial Accounting Standards  No.  123,
"Accounting  for Stock-Based Compensation" ("SFAS 123").   This
new       standard       defines       a       fair       value

<PAGE>
based  method  of  accounting for employee stock  options,  and
gives  companies  a choice of recognizing related  compensation
expense by adopting the new fair value method or continuing  to
measure  compensation under Accounting Principles Board Opinion
No.  25 ("APB 25").  The company intends to continue using  the
measurement  prescribed by APB 25.  Had compensation  cost  for
these  plans  been  determined consistent with  SFAS  123,  the
company's  net  income and earnings per share would  have  been
reduced to the following pro forma amounts:

                                                   1996    1995
Net Income (In thousands)
As Stated                                       $69,454  $30,297
Pro Forma                                       $69,001  $30,087
Primary Earnings per Common Share
As Stated                                       $  2.67  $  0.95
Pro Forma                                       $  2.65  $  0.95
Fully Diluted Earnings per Common Share
As Stated                                       $  2.67  $  0.99
Pro Forma                                       $  2.65  $  0.98

      Because  the SFAS 123 method of accounting has  not  been
applied  to  options granted prior to December  31,  1994,  the
resulting pro forma compensation cost may not be representative
of the cost to be expected in future years.

      The fair value of each grant is estimated on the date  of
the grant using the Black-Scholes option pricing model with the
following weighted average assumptions:

                                                   1996    1995
Risk Free Interest Rate                            6.08%    6.23%
Expected Dividend Yield                            2.00%    2.00%
Expected Volatility                               33.00%   33.00%
Expected Life in Years                             4.43     5.46

      The following is a summary of the transactions and status
of the company's stock option plans:

                               1996           1995           1994
                               Average        Average        Average
                              Exercise       Exercise       Exercise
(Shares in thousands)    Shares  Price  Shares  Price  Shares  Price
Outstanding  at Beginning
  of Year                 4,449 $20.17   4,92  $19.63   4,176 $17.80
Granted
  Exercise Price equals 
   Fair Value                42  23.88    155   24.15   1,359  22.51
 Exercise Price greater than
  Fair Value                105   22.38    137   22.38
Exercised                  (153)  15.88   (391)  13.68   (517)  12.07
Canceled                   (467)  22.38   (373)  22.29    (97)  21.59
Outstanding at End 
  of Year                 3,976  $20.18  4,449  $20.17  4,921  $19.63
Exercisable at End
  of Year                 1,243  $14.92  1,220  $14.29  1,241  $12.86
Weighted Average Fair Value
 of Options Granted               $6.34          $7.68

<PAGE>
      The  following  summarizes information  about  the  stock
options outstanding at December 27, 1996:

                    Options Outstanding            Options Exercisable
                           Weighted-
                             Average Weighted-               Weighted-
Range of    Outstanding    Remaining   Average    Exercisable  Average
Exercise        Options  Contractual  Exercise        Options Exercise
Prices   (In thousands) Life (Years)     Price (In thousands)    Price
$7.81 to 10.31      525         3.77     $9.98            525    $9.98
$10.50 to 19.50     590         5.42     17.89            590    17.89
$20.00 to 22.00      94         6.04     20.63             83    20.63
$22.38            2,513         6.52     22.38             20    22.38
$22.75 to $29.94    254         7.12     24.66             25    23.61
$7.81 to 29.94    3,976         6.02    $20.18          1,243   $14.92

      At December 27, 1996, 1,303,605 shares were available for
future grants of stock options under the plans.

     In 1995, the Board of Directors adopted the company's 1995
Stock  Bonus Plan ("Stock Bonus Plan").  The Stock  Bonus  Plan
permits  executives  and  key employees,  as  selected  by  the
Compensation  Committee of the Board of Directors,  to  receive
all  or  part of their bonuses in the form of shares of  common
stock  or  phantom shares.  In addition, non-employee directors
may  elect  to  receive all or part of their  annual  retainers
and/or  meeting fees in the form of shares of common  stock  or
phantom shares.  Participants receive a premium in the form  of
additional  shares equal to 17.6% which vest over  a  two  year
period.  During 1996, the company issued 7,402 shares of common
stock  and 14,011 phantom shares, including the related premium
shares.   At  December 27, 1996, 378,431 shares were  available
for stock bonuses and premiums under the plan.


NOTE 11.  COMMITMENTS AND CONTINGENCIES

Commitments

Ship Purchases and Ship Management
      The  company took delivery of and made final payments  on
five  C11-class  vessels in 1995 and one  C11-class  vessel  in
1996.   The  total cost of the six C11-class vessels  was  $529
million,  including  total payments to the  shipyards  of  $503
million, of which $62 million was paid in January 1996.

      In January 1995, the company and Columbia entered into an
agreement   under   which  Columbia  would   provide   crewing,
maintenance, operations and insurance for the company's six C11-
class vessels for a per diem fee per vessel.  The agreement may
be terminated at any time by either party with notice.

Alliances
      The  alliance agreements between the company, OOCL,  MOL,
NLL  and MISC, collectively referred to as the Global Alliance,
were fully implemented in the first quarter of 1996.  Under the
current  alliance agreements, alliance partners contribute  and
are   allocated   vessel   space,   which   may   be   adjusted

<PAGE>
from  time  to time.  The agreements provide for,  among  other
things,  settlement  of the difference  between  the  value  of
vessel  space provided by each partner and the value of  vessel
space available to that partner, at specified vessel costs  per
TEU  per  day.   Agreements  covering  terminal  and  equipment
sharing  among  the  Global Alliance  partners  have  not  been
reached,  and  the company is unable to predict  at  this  time
whether or when such agreements will be reached.

      NLL  merged with the container line operations of P&O  on
December  31, 1996 to form P&O Nedlloyd Container Line Limited.
NLL  and P&O were each members of different alliances, and  the
future  alliance  participation of  P&O-NL  has  not  yet  been
determined. If P&O-NL does not continue in the Global Alliance,
there  could  be a significant impact on the Global  Alliance's
operations.   The  company  cannot predict  when  the  alliance
participation  of  P&O-NL will be determined or  the  resulting
impact  on  the  operations of the Global  Alliance.   However,
while  no  assurances can be given, the company  believes  that
acceptable alternatives may be available.

      In  September  1996, the company and  TMM  amended  their
existing agreement for the reciprocal charter of vessel  space.
The  amended agreement is effective until late April  1999  and
automatically  renews for one year unless terminated  with  one
year's notice.

      The  company and Matson commenced service under a 10-year
alliance  in  February 1996.  In connection with the  alliance,
the  company sold Matson six of its U.S.-flag ships (three  C9-
class  vessels and three C8-class vessels) and certain  of  its
assets  in Guam for approximately $163.4 million in cash.   One
of  the ships was sold in December 1995, and the remaining five
vessels  were  sold  in January 1996.  Four of  these  vessels,
together  with a fifth Matson vessel, are currently being  used
in  the alliance.  The net gain on the sale of the four vessels
in  the  alliance and the Guam assets is estimated to  be  $1.9
million,  depending upon final vessel modification and  drydock
costs, and will be deferred and amortized over the 10-year term
of  the alliance.  The net gain on the sale of the fifth vessel
was  $1.6  million and was recognized in the first  quarter  of
1996.   Matson is operating the vessels in the alliance,  which
serves the U.S. West Coast, Hawaii, Guam, Korea and Japan,  and
has  the use of substantially all the westbound capacity.   The
company  has the use of substantially all the alliance vessels'
eastbound capacity.

      The value of vessel space provided by the company to  the
alliances  is  less  than  the  value  of  the  total  capacity
allocated  to it through the alliances, resulting in an  annual
net  cash  payment  from the company to its alliance  partners.
The amount paid to alliance partners was $50.6 million in 1996,
and is currently estimated to be $55.8 million in 1997.

      In  connection  with the sale of the company's  K10-class
vessel  construction  contract to a third  party  in  September
1995,  the  company, MOL, OOCL and NLL formed a  joint  venture
company,  in which their respective shares are each  25%,  that
agreed  to charter back the K10 vessels for seven years.   OOCL
has  agreed  to subcharter the K10s from the joint venture  for
seven  years for use in the Asia-Europe trade, replacing  three
of  its 2,800 twenty-foot equivalent unit F-class vessels.  The
three replaced F-class vessels are being chartered to the joint
venture           for          ten          years           and

<PAGE>
subchartered by the company from the joint venture through  May
2000.   The  subcharters  for two of  such  vessels  have  been
assumed  by  TMM through May 1999.  TMM's remaining obligations
of  $40.8  million  under  the assumed  subcharters  have  been
guaranteed by the company.  The company has been deploying  the
third  F-class  vessel since May 1996 in its  West  Asia/Middle
East service.

Facilities, Equipment and Services
      The  company  had  outstanding  purchase  commitments  to
acquire  cranes,  facilities, equipment and  services  totaling
$84.7  million at December 27, 1996.  In addition, the  company
has  commitments to purchase terminal services  for  its  major
Asian  operations.  These commitments range  from  one  to  ten
years, and the amounts of the commitments under these contracts
are  based upon the actual services performed.  At December 27,
1996,  the  company had outstanding letters of credit  totaling
$29.0  million, which guarantee the company's performance under
certain of its commitments.

      The  company  and  a  Philippine terminal  developer  and
operator formed a joint venture for the development of terminal
facilities in Karachi, Pakistan, in which each share equally in
the  venture's  operations, profits and commitments.   In  June
1996,   the   joint  venture  entered  into  an  implementation
agreement  with an agency of the Republic of Pakistan regarding
construction  and operation of these terminal facilities.   The
joint venture is currently arranging financing for the project.
Subject  to  completion  of  the financing  and  other  related
arrangements, the company currently anticipates construction to
begin in early 1997.

Employment Agreements
      The  company has entered into employment agreements  with
certain of its executive officers.  The agreements provide  for
certain   payments   to  each  officer  upon   termination   of
employment, other than as a result of death, disability in most
cases, or justified cause, as defined.  The aggregate estimated
commitment under these agreements was $12.8 million at December
27, 1996.

Contingencies
     In October 1995, Lykes filed a petition seeking protection
from  its  creditors  under Chapter 11 of the  U.S.  Bankruptcy
laws.   The company chartered four L9-class vessels from Lykes,
and  Lykes operates three Pacesetter vessels chartered from the
company.   All four L9s were redelivered to Lykes by  September
25, 1996, and the three Pacesetters continue to be operated  by
Lykes.   On July 26, 1996, the Bankruptcy Court gave its  final
approval  to a settlement agreement, which became effective  on
August  9,  1996,  between the company and Lykes,  establishing
terms for the payment of the company's claims against Lykes for
unpaid charter hire.  The settlement also allows Lykes the  use
of  the  three Pacesetters until December 31, 1997 and requires
Lykes  to  obtain  the  release of liens  it  permitted  to  be
established  against those vessels.  Certain  Bankruptcy  Court
orders  underlying the settlement agreement have been appealed.
Lykes'  bankruptcy filing is not expected to  have  a  material
adverse impact on the company's consolidated financial position
or results of operations.

      On  December  27, 1996, Lykes and Canadian Pacific,  Ltd.
("CP") entered into a Letter of Intent under which CP or one of
its  affiliates  would purchase Lykes' U.S. container  shipping
services.   Under  the  proposed  transaction,  CP  would  time
charter     Lykes'    vessels,    including    the    company's

<PAGE>
Pacesetters.  The company has been advised that CP also intends
to  assume  certain of Lykes' obligations under the  settlement
agreement.  Finalization of the Lykes purchase by CP is subject
to  satisfactory resolution of objections to the purchase filed
with  the Bankruptcy Court by certain Lykes creditors and final
Bankruptcy Court approval.

      The  company  is  a  party to various legal  proceedings,
claims  and  assessments arising in the course of its  business
activities.  Based upon information presently available, and in
light  of  legal and other defenses and insurance coverage  and
other  potential sources of payment available to  the  company,
management does not expect these legal proceedings, claims  and
assessments,  individually  or in  the  aggregate,  to  have  a
material adverse impact on the company's consolidated financial
position or operations.


NOTE 12.  SALE OF DOMESTIC DISTRIBUTION SERVICES

      In  May  1996,  the  company sold its rights  to  service
certain domestic intermodal customers of APLLTS, a wholly owned
subsidiary  of the company, for $2.0 million in cash  and  $6.0
million  in notes, and realized a pre-tax gain of $6.9 million.
In  addition, APLLTS and the purchaser entered into  a  10-year
agreement  whereby APLLTS will provide stacktrain  services  to
the  purchaser.  Revenues related to the servicing rights  sold
represented approximately 4% of the company's consolidated 1996
revenues and approximately 6% of consolidated 1995 revenues.


NOTE 13.  BUSINESS SEGMENT INFORMATION

      The company provides container transportation services in
North  America, Asia and the Middle East through an  intermodal
system  combining  ocean,  rail and truck  transportation.   In
addition,  the  company was engaged in real  estate  operations
until  1994, when its remaining real estate holdings were sold.
Revenues  and Operating Income for 1994 for the company's  real
estate   operations  were  $16.2  million  and  $9.0   million,
respectively.   Identifiable assets related  to  the  company's
real  estate  operations, primarily notes  receivable,  totaled
$0.6  million, $1.2 million and $6.0 million in 1996, 1995  and
1994, respectively.

       The  following  table  shows  the  percentage  of  ocean
transportation revenues by country:

                      1996              1995              1994
               OriginDestination OriginDestination OriginDestination
United States    24%      39%      27%      41%      26%       44%
Hong Kong        13        4       13        5       14         4
People's Republic
 of China        12        3       10        3       10         3
Japan             8       10        8       10        9        11
Taiwan            7        3        8        3        9         3
India             6        3        5        3        5         2
Indonesia         4        2        4        2        4         1
Korea             4        3        4        3        4         3
Thailand          4        2        3        2        3         1
Other            18       31       18       28       16        28

<PAGE>
     Operating income, net income and identifiable assets
cannot be allocated on a geographic basis due to the nature of
the company's business.


NOTE 14.  QUARTERLY RESULTS (Unaudited)

(In millions, except per share amounts)

                              1996                     1995
Quarter       December September   June  April December September  June   April
Ended               27        20     28      5       29        22    30       7
Revenues         $725.5   $646.2 $641.1 $726.3   $769.9    $711.1 $674.3 $740.7
Operating Income
 (Loss)(1)(2)      31.7     48.9   42.5   17.6    (13.4)     53.5   24.7    3.6
Income (Loss)Before
 Taxes             22.8     40.9   33.9    6.6    (21.3)     49.8   23.0    1.7
Net Income (Loss  $16.6    $28.2  $20.8   $3.9   $(15.9)   $ 30.9  $14.2  $ 1.1
Earnings (Loss)
 Per Common Share
Primary           $0.66    $1.07  $0.78  $0.15   $(0.61)   $ 1.02  $0.45 $(0.02)
Fully Diluted     $0.65    $1.07  $0.78  $0.15   $(0.61)   $  0.97 $0.44 $(0.02)
Cash Dividends
 Per Common Share $0.10    $0.10  $0.10  $0.10    $0.10      $0.10 $0.10  $0.10
Market Price Per Common Share
High           $24 1/8  $25 7/8 $28 7/8 $23 7/8  $29 3/4 $31 1/2 $24 3/8 $24 1/4
Low             21 1/8   22      23      20 1/2   22 1/4  23 1/2  22 1/4  21 1/8

(1)During  1996, the company recorded a first quarter  gain  of
   $1.6  million on the sale of a vessel, a second quarter gain
   of  $6.9  million  on the sale of its domestic  distribution
   services  segment.   In addition, during 1996,  the  company
   recorded gains of $12.9 million in the third quarter  and  a
   net  loss  of  $0.3 million in the fourth quarter  resulting
   from   the   curtailment  of  pension   and   postretirement
   obligations due to workforce reductions.  During the  fourth
   quarter of 1996, the company recorded gains of $11.5 million
   and  $9.2  million from the sale of certain cranes from  its
   terminals  in  Los  Angeles  and  Oakland,  and  residential
   property in Singapore, respectively.

(2)   During the fourth quarter of 1995, the company recorded a
   restructuring charge of $48.4 million related to the acceleration
   of its program to reengineer its order cycle processes and other
   organizational changes.  The company incurred costs, related to
   its corporate initiatives, not included in the restructuring
   charge, of $6.6 million and $24.9 million in the fourth quarter
   and year of 1995, respectively.  During the 1995 fourth quarter
   and full year, the company recognized gains of $2.5 million and
   $6.2  million  on vessel sales, respectively,  and  received
   liquidated damages resulting from the delayed delivery of two of
   the  new C11-class vessels of $2.0 million and $5.5 million,
   respectively.

<PAGE>
            SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS


(In thousands)



Description    Balance at     Charged To   Deductions-      Balance at
                Beginning       Cost and  Describe (1)     End of Year
                  of Year        Expense


Allowance for Doubtful Accounts


December 27, 1996 $22,531          6,144        (8,845)        $19,830

December 29, 1995 $21,908         14,937       (14,314)        $22,531

December 30, 1994 $10,359         13,217        (1,668)        $21,908


(1)Uncollectible receivables written off, net of recoveries and
   other items.


<PAGE>
ITEM 9.   DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

                             PART III


ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

      The  information  with respect to Directors  and  certain
executive  officers of the company appearing under the  caption
"Election  of Directors - Information With Respect to  Nominees
and  Directors" in the company's definitive proxy statement for
the  annual meeting of stockholders to be held on May 14,  1997
is hereby incorporated herein by reference.

The  following sets forth certain information with  respect  to
the remaining executive officers of the company:

John  G.  Burgess, age 52, was elected Executive Vice President
of  the  company in May 1995.  He has also served as  Executive
Vice  President of American President Lines, Ltd. ("APL") since
December  1992.   Prior to that, he served  as  Executive  Vice
President  and  Chief Operating Officer APL from  May  1990  to
November 1992.

Maryellen  B.  Cattani,  age  53, was  elected  Executive  Vice
President of the company in March 1995.  She has also served as
General  Counsel and Secretary of the company since  July  1991
and  as  a Senior Vice President from July 1991 to March  1995.
Prior to joining the company, she was a partner in the law firm
of Morrison & Foerster from 1989 to 1991.

L.  Dale Crandall, age 55, was elected Executive Vice President
and  Chief Financial Officer of the company in March  1995  and
Treasurer of the company in September 1995.  Prior to that, Mr.
Crandall was managing partner of Price Waterhouse's Los Angeles
office since 1990.

Michael  Goh,  age 47, was elected Executive Vice President  of
the  company in April 1996.  Prior to that, he served as Senior
Vice  President of the company from March 1996 to  April  1996,
Senior  Vice President of APL from January 1996 to  March  1996
and  in  various  capacities with APL Land Transport  Services,
Inc.,  including Senior Vice President from May  1992  to  July
1994 and Vice President from May 1989 to April 1992.

James  S. Marston, age 63, was elected Executive Vice President
and  Chief Information Officer of the company in May 1995.   He
served  as Senior Vice President and Chief Information  Officer
of the company from September 1987 to May 1995.

William  J.  Stuebgen, age 49, has served  as  Vice  President,
Controller of the company since October 1990.

The  executive officers of the company are elected by the Board
of  Directors.   Each officer holds office  until  his  or  her
successor  has been duly elected and qualified,  or  until  the
earliest  of  his  or  her  death, resignation,  retirement  or
removal by the Board.


<PAGE>
ITEM 11.  EXECUTIVE COMPENSATION

      The information appearing under the caption "Compensation
of  Executive  Officers and Directors"  and  in  the  company's
definitive   proxy   statement  for  the  annual   meeting   of
stockholders to be held on May 14, 1997, is hereby incorporated
herein by reference.


ITEM  12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS  AND
MANAGEMENT

      The information appearing under the captions "Election of
Directors-Stock Ownership of Directors and Executive  Officers"
and   "Certain  Beneficial  Ownership  of  Securities"  in  the
company's definitive proxy statement for the annual meeting  of
stockholders to be held on May 14, 1997, is hereby incorporated
herein by reference.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information appearing under the captions "Compensation
of  Executive  Officers and Directors -- Employment  Contracts,
Termination  of  Employment and Change-in-Control  Arrangements
and  Certain  Transactions" in the company's  definitive  proxy
statement for the annual meeting of stockholders to be held  on
May 14, 1997, is hereby incorporated herein by reference.


                             PART IV


ITEM  14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND  REPORTS
ON FORM 8-K
(a) Documents filed as part of this report:

  1. Financial Statements and Schedules


  The  following  report  of  independent  public  accountants,
  consolidated   financial  statements   and   notes   to   the
  consolidated   financial  statements  of  APL   Limited   and
  subsidiaries are contained in Part II, Item 8:

  a. Report of Independent Public Accountants
  b. Consolidated Statement of Income
  c. Consolidated Balance Sheet
  d. Consolidated Statement of Cash Flows
  e. Consolidated Statement of Changes in Stockholders' Equity
  f. Notes to Consolidated Financial Statements

  2. The following schedules are contained in Part II, Item 8:

  a. Schedule II - Valuation and Qualifying Accounts

<PAGE>
3.Exhibits required by Item 601 of Regulation S-K

     The following documents are exhibits to this Form 10-K

Exhibit No.    Description of Document

2.1*  Purchase  Agreement as of May 2, 1996, by and  among  Hub
      Group, Inc., APL Limited and APL Land Transport Services,
      Inc.,   incorporated  by  reference  to  the  identically
      numbered exhibit to the Form 8-K (File No. 1-8544), dated
      May 2, 1996 and filed on May 17, 1996.

3.1*  Integrated   copy   of   the   amended   Certificate   of
      Incorporation, filed as Exhibit 3.1 to the company's Form
      10-Q (File No. 1-8544), dated November 1, 1995.

3.2*  Integrated copy of the amended By-Laws, filed as  Exhibit
      3.1  to the company's Form 10-Q (File No. 1-8544),  dated
      August 2, 1996.

3.3*  Certificate  of Ownership and Merger merging APL  Limited
      into American President Companies, Ltd., and changing the
      name  of  American  President  Companies,  Ltd.  to   APL
      Limited, effective June 1, 1996, filed as Exhibit 3.2  to
      the  company's Form 10-Q (File No. 1-8544), dated  August
      2, 1996.

4.1*  Amended  and Restated Rights Agreement dated October  22,
      1991, between the company and The First National Bank  of
      Boston,  as  Rights Agent, filed as Exhibit  4.1  to  the
      company's  Form SE (File No. 1-8544), dated  October  22,
      1991.

4.2*  Trust  Indenture between American President Lines,  Ltd.,
      Issuer,  and  Security  Pacific National  Bank,  Trustee,
      dated as of April 22, 1988, President Truman Issue, filed
      as  Exhibit  4.1 to the company's Form SE  (File  No.  1-
      8544), dated July 26, 1988.

4.3*  Forms  of Series I and Series II Bonds, filed as part  of
      Exhibit  4.1 to the company's Form SE (File No.  1-8544),
      dated July 26, 1988.

4.4*  Registration Rights Agreement, among the company, Hellman
      &  Friedman Capital Partners, Hellman & Friedman  Capital
      Partners International (BVI), and APC Partners; dated  as
      of  August 3, 1988, as amended (without exhibits),  filed
      as  Exhibit  4.2 to the company's Form SE  (File  No.  1-
      8544), dated February 17, 1989.

4.5*  Indenture, dated as of November 1, 1993, between American
      President Companies, Ltd. and The First National Bank  of
      Boston  as Trustee, filed as Exhibit 4.1 to the company's
      Form 8-K (File No. 1-8544), dated November 29, 1993.

4.6*  Form of 7-1/8% Senior Note Due 2003 of American President
      Companies,  Ltd., filed as Exhibit 4.2 to  the  company's
      Form 8-K (File No. 1-8544) dated November 29, 1993.

4.7*  Form  of  8%  Senior  Debentures  Due  2024  of  American
      President Companies, Ltd., filed as Exhibit 4.20  to  the
      company's  Form  10-K (File No. 1-8544), dated  March  9,
      1994.

<PAGE>
10.1* Operating-Differential  Subsidy  Agreement  (No.  MA/MSB-
      417), effective as of January 1, 1978, between the United
      States  and  American  President Lines,  Ltd.,  filed  as
      Exhibit  10.1 to the company's Form SE (File No. 1-8544),
      dated March 17, 1992.

10.2* Lease  Agreement,  dated June 1, 1988,  between  Monsanto
      Company and American President Intermodal Company,  Ltd.,
      filed as Exhibit 10.14 to the company's Form SE (File No.
      1-8544), dated July 26, 1988.

10.3* Lease Agreement, dated June 1, 1988, between Consolidated
      Rail   Corporation  and  American  President   Intermodal
      Company,  Ltd.,  filed as Exhibit 10.2 to  the  company's
      Form SE (File No. 1-8544), dated March 14, 1990.

10.4* Lease and Preferential Assignment Agreement dated January
      6,  1971, and First Supplemental Agreement dated February
      24,  1971,  between  the  City of  Oakland  and  Seatrain
      Terminals of California, Inc., filed as Exhibit 10.32  to
      the   company's  Registration  Statement  on  Form   S-l,
      Registration  No.  2-93718,  which  became  effective  on
      November 1, 1984.

10.5* Second  Supplemental Agreement to Lease and  Preferential
      Assignment Agreement, dated May 3, 1988, filed as Exhibit
      10.3  to  the company's Form SE (File No. 1-8544),  dated
      March 14, 1990.

10.6* Preferential Assignment dated February 23, 1972,  between
      the City of Oakland and Seatrain Terminals of California,
      Inc.,   filed   as   Exhibit  10.33  to   the   company's
      Registration Statement on Form S-l, Registration  No.  2-
      93718, which became effective on November 1, 1984.

10.7* Assignment,  Designation of Secondary  Use  and  Consent,
      dated  December  11,  1974, among Seatrain  Terminals  of
      California,  Inc., American President  Lines,  Ltd.,  the
      City  of  Oakland  and  Seatrain Lines,  Inc.,  filed  as
      Exhibit 10.34 to the company's Registration Statement  on
      Form   S-l,   Registration  No.  2-93718,  which   became
      effective on November 1, 1984.

10.8* Acknowledgment of Termination of Consent to Secondary Use
      and  Sublease and Assumption of Entire Combined  Premises
      and  Cranes dated December 18, 1981, between the City  of
      Oakland  and  American President Lines,  Ltd.,  filed  as
      Exhibit 10.35 to the company's Registration Statement  on
      Form   S-l,   Registration  No.  2-93718,  which   became
      effective on November 1, 1984.

10.9* Supplemental  Agreement dated July 6, 1982,  between  the
      City of Oakland and American President Lines, Ltd., filed
      as  Exhibit 10.36 to the company's Registration Statement
      on  Form  S-l,  Registration No.  2-93718,  which  became
      effective on November 1, 1984.

<PAGE>
10.10*Permit No. 441, dated November 26, 1980, Second Amendment
      to  Permit  No.  441, dated February 7, 1983,  and  Third
      Amendment to Permit No. 441, dated May 10, 1984,  between
      the  City  of  Los Angeles and American President  Lines,
      Ltd.,   filed   as   Exhibit  10.37  to   the   company's
      Registration Statement on Form S-l, Registration  No.  2-
      93718, which became effective on November 1, 1984.

10.11*Fourth  Amendment to Permit No. 441, dated as of  October
      29,  1986  between the City of Los Angeles  and  American
      President  Lines,  Ltd., filed as  Exhibit  10.4  to  the
      company's  Form  SE (File No. 1-8544),  dated  March  23,
      1987.

10.12*Sixth Amendment to Permit No. 441, dated as of August 30,
      1993,  between  the  City  of  Los  Angles  and  American
      President  Lines,  Ltd., filed as Exhibit  10.12  to  the
      company's  Form 10-K (File No. 1-8544), dated  March  14,
      1996.

10.13*Financing  and Security Agreement, dated March 27,  1984,
      between  American President Lines, Ltd. and the  City  of
      Los  Angeles, California, filed as Exhibit 10.38  to  the
      company's    Registration   Statement   on   Form    S-1,
      Registration  No.  2-93718,  which  became  effective  on
      November 1, 1984.

10.14*Lease,  dated  July  31,  1972,  Lease  Agreement,  dated
      September 1, 1980, Memorandum, dated September  1,  1980,
      and  two  letters dated July 3, 1981 and July  14,  1981,
      respectively, between Hanshin Port Development  Authority
      and  American  President Lines, Ltd.,  filed  as  Exhibit
      10.39 to the company's Registration Statement on Form  S-
      1,  Registration No. 2-93718, which became  effective  on
      November 1, 1984.

10.15*Pre-engagement Agreement for Lease dated March 17,  1983,
      Supplemental Agreement dated March 17, 1983 and  form  of
      Wharf  Lease  Agreement  between Yokohama  Port  Terminal
      Corporation and American President Lines, Ltd., filed  as
      Exhibit 10.41 to the company's Registration Statement  on
      Form   S-l,   Registration  No.  2-93718,  which   became
      effective on November 1, 1984.

10.16*Lease  Contract  of  Wharves Nos. 68 &  69  of  Container
      Terminal  No.  3  Kaohsiung Harbor, Taiwan,  Republic  of
      China,  dated  December 31, 1987 and Equipment  Agreement
      between  the  Kaohsiung  Harbor  Bureau  and  APL,  dated
      December 31, 1987, filed as Exhibit 10.4 to the company's
      Form SE (File No. 1-8544), dated March 11, 1988.

10.17*Lease  dated April 28, 1978, Memorandum of Understanding,
      Addendum  to Lease dated May 9, 1978, Addendum No.  2  to
      Lease  dated July 28, 1978, and Addendum No. 3  to  Lease
      dated March 27, 1984, between Sunset Cahuenga Building, a
      Joint  Venture, and American President Lines, Ltd., filed
      as  Exhibit 10.44 to the company's Registration Statement
      on  Form  S-l,  Registration No.  2-93718,  which  became
      effective on November 1, 1984.

10.18*Addendum No. 4 dated April 19, 1985 to Lease dated  April
      28,  1978,  between  Sunset Cahuenga  Building,  a  Joint
      Venture,  and  American President Lines, Ltd.,  filed  as
      Exhibit  10.1 to the company's Form SE (File No. 1-8544),
      dated December 12, 1985.

<PAGE>
10.19*Addendum  No. 5 dated July 25, 1986 to Lease dated  April
      28,  1978,  between  Sunset Cahuenga  Building,  a  Joint
      Venture,  and  American President Lines, Ltd.,  filed  as
      Exhibit  10.5 to the company's Form SE (File No. 1-8544),
      dated March 11, 1988.

10.20*Addendum  No. 6, dated May 1, 1988, to Lease dated  April
      28,  1978,  between  Sunset Cahuenga  Building,  a  Joint
      Venture,  and  American President Lines, Ltd.,  filed  as
      Exhibit 10.13 to the company's Form SE (File No. 1-8544),
      dated July 26, 1988.

10.21*Lease  Agreement  between Port of  Seattle  and  American
      President  Lines, Ltd. at Terminal 5 dated September  26,
      1985,  filed  as  Exhibit 10.5 to the company's  Form  SE
      (File No. 1-8544), dated December 12, 1985.

10.22*Amendment  No. 6 to the Lease Agreement between  Port  of
      Seattle and American President Lines, Ltd. at Terminal 5,
      and  assignment  of  the  lease from  American  President
      Lines, Ltd. to Eagle Marine Services, Ltd. dated June  1,
      1994,  excluding  exhibits and other related  agreements,
      filed  as  Exhibit 10.1 to the company's Form 10-Q  (File
      No. 1-8544), dated August 12, 1994.

10.23 Lease  Agreement  between  the  company  and  Shorenstein
      Realty Investors Three, L.P. effective December 31, 1996,
      without exhibits.

10.24*Grantor  Trust  Agreement  with  U.S.  Trust  Company  of
      California,  N.A.,  effective April 10,  1989,  filed  as
      Exhibit  10.1 to the company's Form SE (File No. 1-8544),
      dated August 1, 1989.

10.25*Assignment  Agreement from United States Lines,  Inc.  to
      American President Lines, Ltd. with attached supplements,
      dated  September 16, 1987, filed as Exhibit 10.8  to  the
      company's  Form  SE (File No. 1- 8544), dated  March  14,
      1990.

10.26*Permit  No.  733, dated September 10, 1993,  between  the
      City of Los Angeles and Eagle Marine Services, Ltd.,  and
      the  Guaranty  of  Agreement made by  American  President
      Lines, Ltd., excluding exhibits, filed as Exhibit 10.1 to
      the company's Form 10-Q (File No. 1-8544), dated November
      18, 1993.

10.27*Loan   Agreement  dated  March  14,  1994  by  and  among
      Kreditanstalt  fur  Wiederaufbau (as Agent  and  Lender);
      Commerzbank AG, Hamburg (as Syndicate Agent); Commerzbank
      AG  (Kiel  Branch), Dresdner Bank AG in Hamburg, Vereins-
      und  Westbank  AG, Deutsche Schiffsbank AG,  Norddeutsche
      Landesbank-Girozentrale,   Deutsche   Verkehrs-Bank   AG,
      Banque   Internationale  a  Luxembourg   S.A.   (as   the
      Syndicate);  and  American  President  Lines,  Ltd.   (as
      Borrower);  including Appendices and  Schedules  thereto,
      filed  as  Exhibit 10.4 to the company's Form 10-Q  (File
      No.  1-8544), dated May 20, 1994 and as Exhibit 10.4a  to
      the  company's  Form  10-K/A  (file  No.  1-8544),  dated
      December 6, 1994.

<PAGE>
10.28*Amendment  No. 1 dated May 19, 1995 to the Loan Agreement
      dated  March  14,  1994  by and among  Kreditanstalt  fur
      Wiederaufbau  (as  Agent  and  Lender);  Commerzbank  AG,
      Hamburg  (as  Syndicate  Agent);  Commerzbank  AG   (Kiel
      Branch),   Dresdner  Bank  AG  in  Hamburg,   Vereins-und
      Westbank   AG,   Deutsche  Schiffsbank  AG,  Norddeutsche
      Landesbank-Girozentrale,   Deutsche   Verkehrs-Bank   AG,
      Banque   Internationale  a  Luxembourg   S.A.   (as   the
      Syndicate);  and  American  President  Lines,  Ltd.   (as
      Borrower),  filed as Exhibit 10.28 to the company's  Form
      10-K (File No. 1-8544), dated March 14, 1996.

10.29*Amendment  No.  2  dated September 1, 1995  to  the  Loan
      Agreement  dated March 14, 1994, as amended by  Amendment
      No.  1  to the Loan Agreement dated May 19, 1995, by  and
      among  Kreditanstalt  fur  Wiederaufbau  (as  Agent   and
      Lender);  Commerzbank AG, Hamburg (as  Syndicate  Agent);
      Commerzbank  AG  (Kiel  Branch),  Dresdner  Bank  AG   in
      Hamburg,  Vereins-und  Westbank AG, Deutsche  Schiffsbank
      AG,    Norddeutsche   Landesbank-Girozentrale,   Deutsche
      Verkehrs-Bank AG, Banque Internationale a Luxembourg S.A.
      (as  the  Syndicate); and American President Lines,  Ltd.
      (as   Borrower);   including  exhibits   thereto   or   a
      description  thereof,  filed  as  Exhibit  10.29  to  the
      company's  Form 10-K (File No. 1-8544), dated  March  14,
      1996.

10.30*Amended  and Restated Guarantee dated as of May 19,  1995
      by  American President Companies, Ltd. (as Guarantor); in
      favor  of  Kreditanstalt fur Wiederaufbau (as  Agent  and
      Lender); and Commerzbank AG Hamburg (as Syndicate Agent);
      Commerzbank  AG  (Kiel  Branch),  Dresdner  Bank  AG   in
      Hamburg,  Vereins-und  Westbank AG, Deutsche  Schiffsbank
      AG,    Norddeutsche   Landesbank-Girozentrale,   Deutsche
      Verkehrs-Bank AG, Banque Internationale a Luxembourg S.A.
      (as  the  Syndicate),  filed  as  Exhibit  10.30  to  the
      company's  Form 10-K (File No. 1-8544), dated  March  14,
      1996.

10.31*Acknowledgment  and Consent of Guarantor dated  September
      1,  1995  by  the  company  (as Guarantor)  in  favor  of
      Kreditanstalt  fur  Wiederaufbau (as Agent  and  Lender);
      Commerzbank AG, Hamburg (as Syndicate Agent); Commerzbank
      AG  (Kiel  Branch), Dresdner Bank AG in Hamburg, Vereins-
      und  Westbank  AG, Deutsche Schiffsbank AG,  Norddeutsche
      Landesbank-Girozentrale,   Deutsche   Verkehrs-Bank   AG,
      Banque   Internationale  a  Luxembourg   S.A.   (as   the
      Syndicate), filed as Exhibit 10.31 to the company's  Form
      10-K (File No. 1-8544), dated March 14, 1996.

10.32*Amendment  No.  1  to the First Preferred  Ship  Mortgage
      dated  September 1, 1995 given by M.V. President Kennedy,
      Ltd. (as Shipowner) to Kreditanstalt fur Wiederaufbau (as
      Mortgagee), filed as Exhibit 10.32 to the company's  Form
      10-K (File No. 1-8544), dated March 14, 1996.

10.33*Amendment  No.  1  to  the Bareboat Charter  Party  dated
      September  1,  1995 by M.V. President Kennedy,  Ltd.  (as
      Shipowner)  and  American  President  Lines,   Ltd.   (as
      Charterer), filed as Exhibit 10.33 to the company's  Form
      10-K (File No. 1-8544), dated March 14, 1996.

10.34*Second  Amended  and Restated Agreement  to  Acquire  and
      Charter  dated  September 1, 1995 by and  among  American
      President  Companies,  Ltd.  (as  Transferor),  of   M.V.
      President  Kennedy, Ltd., of M.V. President Adams,  Ltd.,
      of  M.V.  President  Kennedy,  Ltd.,  of  M.V.  President
      Kennedy,  Ltd.  and  of  M.V.  President  Kennedy,   Ltd.
      (Transferees), Kreditanstalt fur Wiederaufbau  (as  Agent
      and   Lender);  Commerzbank  AG,  Hamburg  (as  Syndicate
      Agent); Commerzbank AG (Kiel Branch), Dresdner Bank AG in
      Hamburg,  Vereins-und  Westbank AG, Deutsche  Schiffsbank
      AG,    Norddeutsche   Landesbank-Girozentrale,   Deutsche
      Verkehrs-Bank AG, Banque Internationale a Luxembourg S.A.
      (as  the  Syndicate);  including exhibits  thereto  or  a
      description  thereof,  filed  as  Exhibit  10.34  to  the
      company's  Form 10-K (File No. 1-8544), dated  March  14,
      1996.

<PAGE>
10.35*Charter  Hire  Guarantee dated as  of  May  19,  1995  by
      American  President  Companies, Ltd. (as  Guarantor);  in
      favor  of  M.V. President Kennedy, Ltd. (as the Obligee),
      filed  as Exhibit 10.35 to the company's Form 10-K  (File
      No. 1-8544), dated March 14, 1996.

10.36*Amendment  No. 1 to Second Amended and Restated Agreement
      to Acquire and Charter dated January 4, 1996 by and among
      American President Companies, Ltd. (as Transferor),  M.V.
      President Kennedy, Ltd., M.V. President Adams, Ltd., M.V.
      President Jackson, Ltd., M.V. President Polk, Ltd.,  M.V.
      President   Truman,  Ltd.  and  APL  Shipholdings,   Ltd.
      (Transferees), Kreditanstalt fur Wiederaufbau  (as  Agent
      and   Lender);  Commerzbank  AG,  Hamburg  (as  Syndicate
      Agent);  Commerzbank AG (Kiel Branch), Dresdner  Bank  AG
      (Hamburg),  Vereins-und Westbank AG, Deutsche Schiffsbank
      AG,    Norddeutsche   Landesbank-Girozentrale,   Deutsche
      Verkehrs-Bank  AG (Hamburg Branch), Banque Internationale
      a  Luxembourg S.A. (as the Syndicate), filed  as  Exhibit
      10.1  to the company's Form 10-Q (File No. 1-8544), dated
      May 10, 1996.

10.37*Credit  Agreement,  dated March 25, 1994  among  American
      President Companies, Ltd., borrower, and Morgan  Guaranty
      Trust Company of New York, J.P. Morgan Delaware, Bank  of
      America National Trust and Savings Association, The First
      National Bank of Boston, Barclays Bank PLC, ABN AMRO Bank
      N.V.,  The  First  National Bank of  Chicago  and  Morgan
      Guaranty  Trust Company of New York, as agent,  filed  as
      Exhibit  10.1  to the company's Form 10-Q  (File  No.  1-
      8544), dated May 20, 1994.

10.38*Amendments Nos. 1 and 2 dated May 10, 1995 and  July  12,
      1995,   respectively,  to  the  Credit  Agreement   among
      American President Companies, Ltd., borrower, and  Morgan
      Guaranty  Trust  Company  of  New  York  (as  agent   and
      participant), Bank of America National Trust and  Savings
      Association,  The  First National  Bank  of  Boston,  The
      Industrial Bank of Japan, Limited, ABN AMRO Bank N.V. and
      The First National Bank of Chicago, filed as Exhibit 10.1
      to  the  company's  Form 10-Q (File  No.  1-8544),  dated
      August 4, 1995.

10.39 Amendment  No.  3  dated  April 5,  1996  to  the  Credit
      Agreement  among  American  President  Companies,   Ltd.,
      borrower, and Morgan Guaranty Trust Company of  New  York
      (as  agent  and  participant), Bank of  America  National
      Trust and Savings Association, The First National Bank of
      Boston,  The Industrial Bank of Japan, Limited, ABN  AMRO
      Bank N.V. and The First National Bank of Chicago.

10.40*Deferred  Compensation Plan For Directors of the company,
      filed  as  Exhibit  10.49  to the company's  Registration
      Statement  on  Form S-l, Registration No. 2-93718,  which
      became effective on November 1, 1984.**

10.41*Executive  Survivors' Benefits Plan, dated  November  29,
      1988,  filed  as  Exhibit 10.4 to the company's  Form  SE
      (File No. 1-8544), dated March 17, 1992.**

10.42*Amendment  No.  1  to  the Executive Survivors'  Benefits
      Plan,  effective December 4, 1992, filed as Exhibit 10.10
      to  the company's Form SE (File No. 1-8544), dated  March
      24, 1993.**

<PAGE>
10.43 1988  Deferred Compensation Plan of APL Limited:  Regular
      Deferral  Plan, an amendment and restatement of the  1988
      Deferred Compensation Plan; effective November 9, 1996.**

10.44 1988  Deferred  Compensation Plan of  APL  Limited:  Pure
      Excess Deferral Plan, dated November 9, 1996.**

10.45*1992  Directors' Stock Option Plan, dated March 17, 1992,
      filed as Exhibit 10.06 to the company's Form SE (File No.
      1-8544), dated May 5, 1992.**

10.46*Amended and Restated Retirement Plan for the Directors of
      American  President Companies, Ltd., dated September  15,
      1992,  filed  as Exhibit 10.01 to the company's  Form  SE
      (File No. 1-8544), dated October 20, 1992.**

10.47*Second  Amendment  to  the American President  Companies,
      Ltd.  Retirement Plan (As Amended and Restated  Effective
      January  1,  1993), effective January 1, 1993,  filed  as
      Exhibit  10.2  to the company's Form 10-Q  (File  No.  1-
      8544), dated May 10, 1996.**

10.48*Third Amendment to the American President Companies, Ltd.
      Retirement  Plan  (As  Amended  and  Restated   Effective
      January  1,  1993), effective January 1, 1997,  filed  as
      Exhibit  10.3  to the company's Form 10-Q  (File  No.  1-
      8544), dated May 10, 1996.**

10.49*American  President  Companies, Ltd. SMART  Plan,  second
      amendment  and  restatement effective  January  1,  1993,
      filed  as Exhibit 10.45 to the company's Form 10-K  (File
      No. 1-8544), dated March 10, 1995.**

10.50*Second  Amendment  to  the American President  Companies,
      Ltd.   SMART   Plan  (Second  Amendment  and  Restatement
      Effective  as of January 1, 1993), effective  January  1,
      1993,  filed as Exhibit 10.4 to the company's  Form  10-Q
      (File No. 1-8544), dated May 10, 1996.**

10.51*Third Amendment to the American President Companies, Ltd.
      SMART Plan (Second Amendment and Restatement Effective as
      of  January 1, 1993), effective April 1, 1996,  filed  as
      Exhibit  10.5  to the company's Form 10-Q  (File  No.  1-
      8544), dated May 10, 1996.**

10.52*Excess-Benefit Plan of the company, amended and  restated
      effective  December 31, 1994, filed as Exhibit  10.46  to
      the  company's Form 10-K (File No. 1-8544),  dated  March
      10, 1995.**

10.53 1995  Deferred Compensation Plan of APL Limited:  Regular
      Deferral  Plan, an amendment and restatement of the  1995
      Deferred Compensation Plan, effective November 9, 1996.**

10.54 1995  Deferred  Compensation Plan of  APL  Limited:  Pure
      Excess Plan, dated November 9, 1996.**

10.55*1995  Supplemental  Executive  Retirement  Plan  of   the
      company, amended and restated effective January 1,  1996,
      filed  as Exhibit 10.51 to the company's Form 10-K  (File
      No. 1-8544), dated March 14, 1996..**

<PAGE>
10.56*1995  Stock Bonus Plan of the company, effective  January
      1,  1996, filed with the company's Proxy Statement  (File
      No.  1-8544) for the Annual Meeting of Shareholders  held
      on May 2, 1995.**

10.57*Employment Agreement between the company and Maryellen B.
      Cattani  dated April 28, 1994, filed as Exhibit 10.10  to
      the  company's Form 10-Q (File No. 1-8544), dated May 20,
      1994.**

10.58*Employment  Agreement between the company and Timothy  J.
      Rhein  dated July 28, 1992, filed as Exhibit 10.1 to  the
      company's Form 10-Q (File No. 1-8544), dated November  4,
      1994.**

10.59*Employment Agreement between the company and Joji Hayashi
      dated  July  28,  1992,  filed as  Exhibit  10.2  to  the
      company's Form 10-Q (File No. 1-8544), dated November  4,
      1994.**

10.60*Amendment No. 1 dated September 7, 1995 to the Employment
      Agreement  as  amended,  between  the  company  and  Joji
      Hayashi, filed as Exhibit 10.2 to the company's Form 10-Q
      (File No. 1-8544), November 1, 1995.**

10.61*Employment  Agreement between the company  and  James  S.
      Marston dated July 28, 1992, filed as Exhibit 10.3 to the
      company's Form 10-Q (File No. 1-8544), dated November  4,
      1994.**

10.62*Employment  Agreement between the  company  and  John  G.
      Burgess dated July 28, 1992, filed as Exhibit 10.4 to the
      company's Form 10-Q (File No. 1-8544), dated November  4,
      1994.**

10.63*Employment Agreement between the company and Michael Diaz
      dated  July  28,  1992,  filed as  Exhibit  10.5  to  the
      company's Form 10-Q (File No. 1-8544), dated November  4,
      1994.**

10.64*Employment  Agreement between the  company  and  L.  Dale
      Crandall dated February 1, 1995, filed as Exhibit 10.3 to
      the  company's  Form  10-Q (File  No.  1-8544),  May  17,
      1995.**

10.65*Agreement  between the company and John M.  Lillie  dated
      October 13, 1995, filed as Exhibit 10.61 to the company's
      Form 10-K (File No. 1-8544), dated March 14, 1996.**

10.66*Form of Indemnity Agreements dated March 11, 1988 between
      the  company  and Charles S. Arledge, John  H.  Barr,  J.
      Hayashi, Forrest N. Shumway and Barry L. Williams,  filed
      as  Exhibit  10.3 to the company's Form SE (File  No.  1-
      8544), dated February 17, 1989.**

10.67*Form of Indemnity Agreements dated April 25, 1991 between
      the  company and F. Warren Hellman and Timothy J.  Rhein,
      filed as Exhibits 10.3 and 10.5 to the company's Form  SE
      (File No. 1-8544), dated May 8, 1991.**

10.68*Indemnity  Agreement dated October 5,  1993  between  the
      company  and  Toni Rembe, filed as Exhibit 10.74  to  the
      company's  Form  10-K (File No. 1-8544), dated  March  9,
      1994.**

<PAGE>
10.69*Form  of Indemnity Agreement dated April 28, 1994 between
      the company and G. Craig Sullivan, filed as Exhibit 10.62
      to the company's Form 10-K (File No. 1-8544), dated March
      10, 1995.**

10.70*Form  of  Indemnity Agreement dated June 20, 1994 between
      the company and Tully M. Friedman, filed as Exhibit 10.63
      to the company's Form 10-K (File No. 1-8544), dated March
      10, 1995.**

11.1  Computation of Earnings Per Share.

21.1  Subsidiaries of the company.

23.1  Consent of Independent Public Accountants.

24.1  Powers of Attorney.

27    Financial  Data  Schedules  filed  under  Article  5   of
      Regulation S-X for the year ended December 27, 1996.

*     Incorporated by Reference

**    Denotes management contract or compensatory plan.

      Pursuant  to  Item 601 (b)(4)(iii)(A) of Regulation  S-K,
certain instruments defining the rights of holders of the long-
term debt of the company and its consolidated subsidiaries have
not  been  filed  because the amount of  securities  authorized
under  each such instrument does not exceed ten percent of  the
total  assets  of  the  company  and  its  subsidiaries  on   a
consolidated  basis.   A copy of any such  instrument  will  be
furnished to the Commission upon request.


(b)  Reports on Form 8-K during the fourth quarter:

     No  current report on Form 8-K was filed during the fourth
     quarter  of the fiscal year for which this report on  Form
     10-K is filed.

<PAGE>
                             SIGNATURES

Pursuant  to  the requirements of Section 13 or  15(d)  of  the
Securities Exchange Act of 1934, as amended, the registrant has
duly  caused  this  report to be signed on its  behalf  by  the
undersigned, thereunto duly authorized.

APL LIMITED          (Registrant)



                                 By /s/ William J. Stuebgen
                                        William J. Stuebgen
                                        Vice President,
                                        Controller and
                                   Chief Accounting Officer
                                        March 5, 1997


Pursuant to the requirements of the Securities Exchange Act  of
1934,  this  report  has  been signed below  by  the  following
persons  on behalf of the registrant and in the capacities  and
on the dates indicated.


       /s/  Joji  Hayashi                             March  5, 1997
      Joji Hayashi
      Chairman of the Board


       /s/  Timothy  J. Rhein                         March  5, 1997
      Timothy J. Rhein
      President, Chief Executive
      Officer and Director


       /s/  Charles  S. Arledge*                      March  5, 1997
      Charles S. Arledge
      Director


       /s/  John  H. Barr*                            March  5, 1997
      John H. Barr
      Director


       /s/  Tully  M. Friedman*                       March  5, 1997
      Tully M. Friedman
      Director


       /s/  F.  Warren Hellman*                       March  5, 1997
      F. Warren Hellman
      Director


<PAGE>
       /s/  Toni  Rembe*                              March  5, 1997
      Toni Rembe
      Director


      /s/ Forrest N. Shumway*                         March  5, 1997
      Forrest N. Shumway
      Director


      /s/ G. Craig Sullivan*                          March  5, 1997
      G. Craig Sullivan
      Director


       /s/  Barry  L. Williams*                       March  5, 1997
      Barry L. Williams
      Director


*By:  /s/ Maryellen B. Cattani                        March  5, 1997
      Maryellen B. Cattani
      Attorney-in-fact