You Get What You Pay For

Earlier this month from the West Coast we heard:
“What is the most important issue? Everyone came forward and said goods
movement.” — Mark Pisano, Director, Southern California Association of
• “This growth puts the fear of God into those of us who realize the
infrastructure isn’t ready to handle that. If this growth triples in 10
years, we’ll be right back where we are today.”… The public pressure
has changed. The public will not put up any longer with congested
freeways and congested streets.”— LA Councilwoman Janice Hahn
• “The trucking industry is sending up red flags. I think we’ll have a
meltdown if we don’t relieve the plight of the independent truckers.”
— LA Councilwoman Janice Hahn
• “Consistent double digit growth in containers arriving at the ports of Long
Beach and Los Angeles has crimped the Southland’s overworked
infrastructure, clogging freeways and increasing air pollution. Last
year, cargo growth, coupled with a shortage of longshoremen and rail
workers, handcuffed the local ports.” — Long Beach Press Telegram
• “All the problems you experience here, they’re coming to us in New York
and New Jersey.” — John Hummer, NJ Transportation Planning
• “Shippers need to be engaged and involved in solving the issues. The
problems should not and can not be the sole responsibility of the state.”
— Rick Gabrielson, Target Corp’s Senior Manager of Import
Operations. Mr. Gabrielson also urged the formation of a “panel of
key stakeholders” that would be “driven” by California’s governor and
the U.S. Secretary of Transportation.
• “Seattle, Tacoma and Portland also face capacity problems as well as
pressure from environmental groups to reduce air quality and
congestion impact in neighborhoods. In Mexico, there are proposals to
expand to attract some cargo that would normally flow through Los
Angeles and Long Beach. One proposal, at Punta Colonet, 80 miles
south of Ensenada, calls for a new container port with a capacity of
about 1 million TEUs per year. That is less than one year’s growth at
Los Angeles and Long Beach. At Prince Ruppert, British Columbia,
500 miles north of Vancouver, there are plans for a 160-acre terminal
that could handle an estimated 2 million TEUs per year. While this
will add another West Coast container portal, it is not expected to
diminish infrastructure requirements at California ports. The bottom
line is that we cannot divert our way out of the congestion we face.” —
Gill V. Hicks, Chairman, California Marine and Intermodal
Transportation System Advisory Council.

And from the East Coast we heard:
• In speaking of “a second industrial revolution” driven by Brazil, Russia,
India and China, President and CEO of P&O Nedlloyd North America
Michael White said, “The resultant impact on network and

infrastructure constraints will become more severe, impacting supply-
chain velocity, inventories and overall costs, and if we as an industry

do nothing, the consequences will be severe … We must improve our
collective forecasting capability, and become better, faster and more
accurate in transferring manifest data”.
• Edward Kelly, Executive Director of the Maritime Association of the Port of
NY/NJ, recommended a national chassis pool along the lines
originally advocated by Mr. Michael Seymour when Mr. Seymour was
Chairman of the Ocean Carrier Equipment Management Association.
“Terminals can no longer be viewed as storage yards for loaded empty
containers and chassis, but must be viewed as very expensive pieces of
real estate whose aim is to move as many containers as possible though
the smallest area”, Mr. Seymour said.
• Citing the acknowledged difficulties in the intermodal supply chain and the
steps that have been taken to address them, Mr. John Ricklefs of
Moffat & Nichols stated, “The list is as long as the number of potential
bottlenecks in the system of transportation and logistics infrastructure
directly used to move a container”.
• Mr. Paul Devine of OOCL chided those attending the Journal of
Commerce’s Trans-Atlantic Maritime Conference. “We are saying the
same things, year after year … What’s our game plan?”
The industry has no game plan, just problems. East Coast officials echoed the
litany recited by West Coast officials. It’s a yearly tradition. It’s almost
ceremonial. But all are in agreement, and all are convinced that, “Something
must be done. Not by me, however. My link, my segment of the supply
chain isn’t the fly in the ointment. We’re not the cause of the horrendous
congestion and supply line breakdowns. It’s those other guys. Somehow.”
In all the above, have you noticed that not one official states that his, or her,
chief concern is “cargo container security”? They live with the confusion,
congestion and consequent delays in the system 24 hours of every day, and
even if the solution to these problems is not readily obvious to them, the actual
problems most certainly are. They’re telling it like it is. They’re paraphrasing
what Jean Godwin said many months ago, “It’s like trying to fit a 16-inch pipe
into a 4-inch opening”.
But others view this international problem differently. They see the millions
of dollars being thrown around by the DHS, so they leap at the opportunity to
grind their own axes. Here’s the rub. The International Cargo Security
Council (ICSC), has just issued the results of a report which stated, believe it
or not, that the No.1 concern among executives responsible for supply chain
operations is “ocean cargo container security”. [As Dave Barry would say,
“I’m not making this stuff up”.] The twin themes at the annual conference
where this paid-for report was issued were: “The return of Investment of
Cargo Security” and “Securing the International Supply Chain”. That says it
all. The truckers, the longshoremen, the environmentalists, the community …
they can all go to blazes.