Port users delivered a strong message Wednesday to Los Angeles and Long Beach: Improve productivity, simplify business processes and build infrastructure or Southern California will continue to lose market share to other ports.
Carriers and cargo interests that addressed the annual Pulse of the Port conference sponsored by the Port of Long Beach said a proliferation of fees and complex business requirements will lead to even further loss of discretionary cargo if these problems are not addressed immediately.
Los Angeles-Long Beach's share of containerized imports from Asia has declined 4 percent since 2007.
Southern California, like other West Coast ports, must improve cargo-handling productivity, said Peter Keller, president of NYK Line North America. "The West Coast does not operate at world-class standards," he said.
The intermodal hand-offs in Los Angeles-Long Beach are inefficient, and the ports should work to maximize on-dock rail usage and look into the formation of chassis pools, Keller said.
Cargo interests find Los Angeles and Long Beach to be high-cost ports due to fees charged under the clean-truck and PierPass extended gates programs and the Alameda Corridor project, said Dean Tracy, director of international transportation at Lowe's, the home improvement retailer.
Complying with the requirements of fee-based programs such as the PortCheck clean-truck program result in administrative costs that cargo interests do not face at other ports, Tracy said.
In fact, competing ports are reducing their costs and streamlining their business requirements in order to take cargo away from Los Angeles-Long Beach, he said.
Los Angeles and Long Beach, which still handle about 40 percent of all U.S. containerized imports, should use the current lull in cargo growth to focus on expanding marine terminals and building intermodal infrastructure for the future, the speakers said.
Growth in cargo volume is expected to return in 2010, and if the ports want to avoid capacity constraints such as plagued Los Angeles and Long Beach in 2004, this is the ideal time to resume their infrastructure programs.
Los Angeles and Long Beach have the most comprehensive array of marine terminal and intermodal options of any U.S. port complex and will remain the preferred gateway for cargo from Asia if they expand their physical plant and reshape their business practices, Tracy said.