STARTING THE NEW YEAR

STARTING THE NEW YEAR

Welcome to 2001! This is always an exhilarating time at The Journal of Commerce as we launch each new year with our biggest special, the annual Review & Outlook. This issue is packed with even more opinions and predictions from the leaders in international transportation than last year's Millennium edition. I am grateful to the 150-plus executives in all facets of trade logistics who provided us with their company and industry insights. Equally, the Review & Outlook is a success because of the generous support of our advertisers. Thank you. My father-in-law was an accomplished architect and meticulous builder. He often repeated after seeing my home improvement projects, 'measure twice, cut once.' Not a bad business philosophy either. I apologize that two executives' perspectives were mistakenly omitted from the Review & Outlook. Andrea Riniker's and Tom Crowley's articles are printed below.

Crowley Maritime Corp., www.crowley.comGrowing by diversifying

Tom Crowley Jr., Chairman, President & CEO

As we look ahead to the year 2001 and beyond, we see some ocean carriers beginning to regain their footing after several years of negotiating the shifting sands of ocean shipping reform, overtonnage in the marketplace and depressed rates.

Recently we have seen carriers generally do a better job of getting a handle on their costs, which has allowed them to price their services competitively and more profitably. Those carriers that are losing money have not yet gained a clear understanding of their costs and continue to price their services at less than compensatory rates. This has put pressure on successful carriers to keep their rates artificially low to retain market share.

The industry is still struggling to earn the cost of capital needed to replace assets such as ships and equipment over time. As a result, carriers are looking for opportunities to grow outside of traditional container common carriage.

One such growth area is in providing value-added services to shippers. Many companies want to reduce overhead associated with logistics and supply chain management, improve visibility of inventory, and make their supply chains more efficient. Companies such as Crowley, which are able to offer a full suite of services, will benefit. We also see growth opportunities in something we call total project management, which involves shipping, logistics, marine engineering, naval architecture, heavy lift services and the like. Crowley has the people, know how and equipment to manage entire projects for companies.

Despite some of the negative influences that remain in the ocean shipping industry, we look to the future with optimism. We see and understand the opportunities before us, and we know that significant and immediate growth may not come from traditional container shipping services.

Port of Tacoma, www.portoftacoma.com

An invitation for Washington

Andrea Riniker, Executive Director

With the new year and the start of a new federal administration, also comes an ideal time for addressing the critical nature of our nation's overall freight transportation system.

The transportation challenge for the new administration includes three major areas: Understanding the true intermodal nature of our nation's freight transportation system, providing leadership and support for increased funding to improve that system, and encouraging the use of new technologies to improve the efficiency and reliability of that sys-

tem.

As leaders in the port industry, we clearly recognize the numerous challenges and problems our transportation system faces at the national level, from railroad bottlenecks in the Midwest to increased trade volume and larger container ships. These factors are all putting more pressure on our nation's ports as well as on our nation's rail and road infrastructure.

While various areas are making progress on specific projects (e.g. Washington state's FAST Corridor, Southern California's Alameda Corridor), these will only be minor provincial victories if they are not aligned with other improvements to our freight transportation system nationwide.

This intermodal transportation challenge for our port industry is greater than just improving our physical infrastructure. It also involves developing new technologies that improve our systems for moving information.

While the federal government has traditionally been in-volved in the road segment of our intermodal system, it must get more engaged and involved in the rail segment if we are to adequately address the key issues that face our nation's overall freight transportation system.

Will the new administration give lip service or leadership to improving and expanding our intermodal freight transportation system at the national level?

For the sake of the port industry, and for our nation's expanding global economy, the answer must be 'Yes.'