Ports could face a logistical nightmare when Maersk Line, Mediterranean Shipping Co. and CMA CGM next year flood the U.S. East and West coasts with big containerships as part of their new P3 Network alliance, but Long Beach and Los Angeles are taking the news in stride.
“We will be able to handle them,” said Ken Uriu, marketing manager at the Port of Long Beach. To add credibility to his assertion, Uriu showed a slide Thursday to the Harbor Transportation Club in Long Beach of three mega-ships berthed simultaneously at the TTI terminal. Two of the ships had capacities of 10,000 20-foot containers, and the third was a 12,000-TEU vessel.
Kathryn McDermott, deputy executive director of business development at the Port of Los Angeles, said her port has been spending $1 million a day to enlarge marine terminals, raise the height of container cranes, deepen the access channel to 53 feet and improve rail infrastructure. Los Angeles and Long Beach together in the coming year will spend $1 billion on such improvements, she said.
“Our facilities can handle these ships. They already have been handling several big vessels at a time,” she said.
The three European lines announced the P3 alliance beginning in the second quarter of 2014 will deploy ships of 8,000-TEU capacity and greater to East Coast ports and 9,000 to 11,000-TEU capacity to West Coast ports.
Carriers about six years ago began deploying mega-ships, 8,000-TEU vessels and greater, in their services to Southern California. Initially, the crush of containers created congestion within the terminals and at the terminal gates. “Yes, we did have some growing pains,” Uriu said.
The largest vessel that calls regularly in Long Beach today has a capacity of 13,800 TEUs. As a first-call inbound port complex, Los Angeles and Long Beach handle a disproportionate number of imports, as well as a large volume of exports. A single vessel call can generate 8,000 to 10,000 container moves.
The ports learned early on that they must invest in their infrastructure because the ships will continue to get bigger. “This is the future,” Uriu said.
In addition to expanding the size of their facilities, several of the 13 container terminals in the port complex are investing hundreds of millions of dollars each in automation designed to improve efficiency and reduce container-handling costs.
One issue the ports have to sort out is how to respond to the uncertainty that exists with the proliferation of carrier vessel-sharing alliances in the trans-Pacific. The Southern California ports have a number of exclusivity arrangements with their tenants, but with carrier alliances often featuring vessels contributed by several lines, vessel calls from week to week can shift from one terminal to another and one port to another.