Trucking’s Magic Hour

Trucking’s Magic Hour

Harbor truckers on the West Coast like to call at Matson Navigation terminals. The gates and container yards are always fully staffed, and gate operations are efficient.

Matson plans its terminal operations with the truckers in mind. “For Matson, turn times are a key performance metric,” said Bal Dreyfus, senior vice president of West Coast terminals. “We look at the trucker as an extension of our customer.”

At the TraPac terminal in Los Angeles, Frank Pisano, executive vice president, keeps the gates open continuously from 8 a.m. until 2:30 a.m. the next day. That means truckers have access to the facility during lunch hour and at the 5 p.m. to 6 p.m. hour between the day and night shifts when some terminals shut down.

“Once you stop, you kill everything,” Pisano said. It’s important to TraPac that the drivers make enough turns each day to pay the notes on their expensive rigs. “I’ve told my staff a hundred times, when the trucking industry fails, we’re out of business a week later,” he said.

APL likewise receives high grades from truckers for the services the company’s terminals provide, including storing imported containers on ready-to-move chassis and working flex gates and night gates as cargo volumes warrant. It’s an extension of the idea some trucking companies put out during a period of tight capacity in the early 2000s, when truckers told shippers the best path to cheaper, speedier service was to make freight operations at docks and terminals more efficient.

APL considers harbor truckers “the embodiment of the end customer, the beneficial cargo owner,” said Nathaniel Seeds, vice president for operations at APL in the Americas. “We really strive to fill our organization with people that care about service excellence.”

According to harbor truckers, if all 13 container terminals in Los Angeles-Long Beach ran their operations the way Matson, TraPac and APL do, the nation’s largest port complex would be the most efficient. That’s not the case, however, and the result is long lines and unacceptable wait times at many terminals.

At the ports, today’s congestion brings back memories of 2005, when Southern California’s terminal operators responded to trucker complaints by forming PierPass to manage a program of extended gates. In addition to the normal five day shifts each week, the terminals ran four full night gates and a Saturday day gate. The 10 eight-hour shifts each week were far more than any other U.S. port offered, and the congestion problem disappeared.

However, during last year’s global trade recession, terminal operators implemented several cost-cutting measures, reducing staffing, sending experienced steady longshoremen back to the hiring hall and eliminating one extended gate each week. Then cargo volumes this year did an about-face, growing 15 percent in the first six months. The understaffed terminals were unprepared, and long truck lines and tortuously slow turn times returned.

It’s a reminder that trucking operations around ports run on a different economic model from that of other trucking companies, stressing not the density of freight volume but time, where the more rapid the turns, the more money-making loads that can be hauled.

California truckers, seeking strength in numbers, formed the Harbor Trucking Association. The association, along with the terminal operators, established a working group to identify the causes of the congestion and develop solutions quickly — before the start of the peak-shipping season next month. It’s not the union that some companies fear at ports, but for the operators themselves, it’s a model of providing a common voice for shared concerns — and what makes sense at the San Pedro ports could work elsewhere.

Right now, the trucking operator’s efforts to influence broader port operations are taking place an hour at a time — the lunch and dinner hours.

Alex Cherin, a Long Beach attorney who represents the truckers, said the first meeting of the working group late last month “was a good first step.” The truckers followed with a list of measures they believe will significantly improve turn times.

A key demand is that all terminals reinstate the fifth PierPass gate each week, and that they do so within 30 days. According to PierPass President Bruce Wargo, seven of the terminals now run five extended gates, and two more will likely join them.

Getting all 13 operators back to five extended gates each week seems pretty basic, but Wargo said some terminals are still struggling with low cargo volume. It costs a terminal about $60,000 a night to run a night gate.

Getting the terminals, truckers and shippers to agree on which days of the week to run extended gates can be difficult. Although everyone agrees Monday through Thursday gates are important, some truckers want the fifth gate to be on Friday night, while others prefer a Saturday day gate. At least one cargo interest would like the fifth gate to be on Sunday night.

Harbor truckers agree with TraPac’s Pisano that continuous operations throughout the day are crucial to efficient turn times. Terminal operators respond that every extra move they make — such as running an early-morning flex gate, keeping the gates open at lunch and running a 5 p.m. flex gate — comes at a cost.

One of the worst times for drivers is when a terminal shuts down for lunch. Some employers allow workers an additional 15 minutes to clean up before lunch. When the gates reopen 60 to 75 minutes later, lines are unbearable, truckers say.

Progress is being made, with 10 of the 13 operators now keeping their gates open at lunch and from 5 to 6 p.m., Wargo said. Truckers note, however, most terminals stagger lunch hours, with half the longshoremen taking lunch at 11 a.m. and the second half starting at noon, so the number of open gates from 11 a.m. to 2 p.m. is cut in half.

Although truckers say this staggered approach is better than shutting down completely, it can result in excessive waits. Matson also staggers lunch hours, but it runs proportionately more gates all day than most terminals, Dreyfus said. Pisano said TraPac pays its gate clerks overtime to work through lunch.

There is general agreement throughout the harbor that the worst time of the day is 6 p.m. Under the PierPass program, which is designed to reduce congestion at the terminals and on the freeways by pushing more truck traffic into the night shift, trucks that call during the day shift are assessed a $50-per-TEU traffic- mitigation fee. The fee is waived after 6 p.m. Drivers begin lining up at the terminal gates at 4 p.m. and wait until 6 p.m. to move into the terminal. This results in congestion outside terminal gates and in container yards when a flood of truckers move in.

Terminal operators are discussing various fixes, such as a variable pricing scheme or waiving the fee beginning at 5 p.m. Pisano said TraPac runs the 5 p.m. flex gate and lets the trucks in immediately to conduct business. They are not assessed the fee as long as they do not exit the terminal before 6 p.m.

Truckers also would like to see the terminals increase their staffing levels. This would improve service at the gates and within the yards. Wargo said staffing levels throughout the harbor have indeed increased 37 percent since January.

Perhaps the biggest obstacle to reducing terminal congestion is to get the terminals and the truckers to agree on just how bad the congestion is. Each party has its own way of measuring wait times.

According to the terminals, the average turn time throughout the harbor in May was 37 minutes, roughly half the average time truckers say they wait. Wargo said that figure was derived from data collected electronically on all trucks.

Truckers contend that measurement is based on when the trucks are clocked into the terminal and does not include down time at breaks and lunch. Also, truckers regularly spend an hour or longer outside the gates, which the terminal operators don’t include in their calculation. Truckers say their calculations show an average turn time of 70 to 92 minutes, with the worst terminals producing turn times of several hours. Terminal operators argue truckers choose to line up at 4 p.m. for the night shift.

Measuring truck trips per day is also problematic because it is based on averages. Truck trips are crucial to the economic health of each owner-operator. Those operating within the metropolitan area say they need four round trips per day to pay the notes on the $100,000 clean trucks now mandatory in Southern California. Drivers serving warehouses in the Inland Empire 50 miles from the harbor need two trips per day.

Terminal operators’ data collected from RFID transmissions indicate drivers average four turns per day. Last month, 1,257 trucks made six trips per day to the terminals and 26 trucks got in 10 turns.

Truckers’ data shows an average of 1.6 turns per day. Those with very short hauls, such as to a near-dock rail-yard five miles from the harbor, skew the average numbers upward, truckers say. Wargo said truckers who serve the distribution hubs in the Inland Empire skew the numbers downward.

Both sides agree they must resolve this issue, which they say is a product of the ports’ clean-trucks programs. The ports forced truckers to retire their old, polluting rigs that many had bought used, in cash, for $20,000 or less. Before the clean-trucks plan began in 2008, drivers could tolerate lengthy turn times, but not today, truckers say.

Importers and exporters, the ultimate customers of terminals and truckers, want the parties to reach an effective solution. Robin Lanier, executive director of the Waterfront Coalition, which represents retailers and other shippers, said any new strategy should not involve another fee. Increasing costs in Los Angeles-Long Beach will force discretionary cargo to other ports, she said.

One important measure more difficult to quantify would be for terminal managers to require workers to treat drivers with respect. Drivers are taking too much verbal abuse at some terminals, trucking executives say.

Matson has a simple formula for preventing that problem. “We treat our labor with respect, Dreyfus said. “We expect them to treat the drivers with respect.”

Contact Bill Mongelluzzo at bmongelluzzo@joc.com.