Port of Discontent

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The Los Angeles Business Journal reportsthat delays at major Southern California ports have frustrated so many shippers that they are diverting freighters to other West Coast ports. David Greenberg writes, "A major South Korean shipping company, fed up with delays at the Port of Long Beach, will begin diverting its biggest freighters to Portland, Seattle and Vancouver as shippers continue searching for alternatives to congested facilities in Southern California. Hanjin Shipping Co. Ltd. will cut the number of containers it sends to the complex and begin diverting its ships, which carry up to 5,500 20-foot containers (TEUs), later this month.

The move underscores a growing impatience among shippers about the
ongoing jam-ups at both ports that results in lost business and higher costs... Since July, 115 vessels have been diverted to other ports, including 30 scheduled to arrive at the L.A.-Long Beach complex this month and 22 in December."

LAist worries for SoCal's economy. Are the ports still struggling to regain revenue lost after the 2002 strike or is there something else troubling our docks?

An editorial in the 11/15/04 edition of the Los Angeles Times may provide some insight. The writer of "L.A.'s Dawdling Ports," points out that "terminal operators [mindful of a deadly crash on the 710 caused by congested truck traffic coming from the ports] promised a year ago to extend gate hours into nighttime or to Saturdays, beginning this month...
Keeping the ports open nights or weekends would not only reduce truck trips during peak traffic times, but it would help ease diesel emissions caused by idling big rigs and container ships. The ports are the biggest source of air pollutants in Southern California.

After a push from Los Angeles City Councilwoman Janice Hahn, who was tired of being told nothing could be done, terminal operators sat down with shippers and retailers to draw up a plan. Because they were making progress in August, Assemblyman Alan Lowenthal (D-Long Beach) agreed to pull a bill that would have made nighttime operations mandatory.

With the threat of legislation gone, the group dropped anchor. Terminal operators say they had to delay even a pilot program because of a labor shortage. The longshoremen's union counters that the ports simply didn't hire enough workers."

The terminal operators are just making excuses. The Los Angeles Times finds that an August ad for 3,000 temporary workers drew half a million applicants from across the country. Unloading goods is one of the best-paying blue-collar jobs left now that so many manufacturing jobs have gone overseas."

How long will terminal operators dawdle before taking the necessary action -hire more workers to work more off-peak hours to increase productivity- that will keep Southern California a viable option for shippers. If terminal operators are worried that increasing off-peak hours will raise prices, and thereby hurt their competitiveness, we recommend that they examine the number of customers who are fleeing their services.

You can't compete if buyers no longer require your services.