Matson is in talks with Totem Ocean Trailer Express Inc., which is based in Federal Way, Wash., to charter a ship that could carry 1,400 vehicles. Matson expects the ship to be available in the fourth quarter. The value of the lease is still under negotiation.

The ship will allow cars to be driven on and off the ship. The system it will use, known as roll-on, roll-off, is more efficient than moving automobiles in frames or containers.

Matson president Jim Andrasick said the system is cheaper, takes less time to operate and causes less damage to cars, he said.

Matson transports about 120,000 automobiles each year, and only a few of its eight ships have roll-on, roll-off capacity. The company has agreements with automakers to deliver westbound DaimlerChrysler vehicles through 2004, eastbound and westbound Ford vehicles through 2004 and eastbound and westbound General Motors vehicles through 2005.

Matson intends to move more vehicles using roll-on, roll-off so that 75 percent will be transported each year using the system once the new ship is in service. The new vessel would be used for biweekly sailings.

Pasha Hawaii Transport Lines LLC said it plans to compete with Matson and Horizon Lines in shipping automobiles between Ha-wai'i and California starting in late 2004. It resumed construction of its first ship in April after an 18-month delay.

Andrasick could not say whether the cost of shipping a vehicle will change with the leasing of the new ship. He said the new handling system means Matson needs additional shoreside improvements in Honolulu and Kahului, to handle more port calls.

Once the new vessel is in service, containers and space currently used to transport cars would be used to ship other cargo.