US seaports: how to avoid congestion in the future?

Résumé du document

The continuous increase of port congestion in the San Pedro Bay is persuading the importers to relocate the port of entry for their goods. However, both the ports at Long Beach and Los Angeles provide facilities and services that cannot matched by any other ports. This reports first aims to present a study of the various relevant factors to be considered when considering alternative ports by an importer/exporter of products using these 2 ports. It secondly lists and assesses the possible alternate ports according to these requirements. The research then proposes 3 different areas of imports: the Northwest Coast, the secondary ports of California and Mexico. The Northwest Coast ports (Vancouver, Tacoma and Seattle) provide good sea transportation and are the closest ports from China. Being fairly large, these ports provide good infrastructure and service levels. However, the lead time is subjected to decrease if the consumption of the imported good is not in the Southwest for areas such as the East Coast or Midwest. The possible cost reduction will depend on the industry and the market in which the company operates.

Extraits

[...] This labor shortage was also experienced by the railroad companies Infrastructure shortage: Not enough locomotives, single track lines, rail congestion, intermodal transfer facilities Trucking driver shortage: rates for drivers are not high enough to motivate more workers in to this sector of moving containers to LA's shipyards. With this precedent, companies may need to consider alternative ports to prevent future congestion events that may produce a negative effect in their supply chains. Factors to determine alternative ports The following relevant factors have to be taken into account when determining an alternative port: 1. Sea transportation 2. Port and area infrastructure 3. Lead-time 4. [...]

[...] Free time allowed for import and export containers on site. LA Port allows 5 days for import containers and 7 days for export containers[7] looking for reduction of 4 days and 6 days respectively. This will become a relevant factor Cost information will have to be acquired from internal and external sources. Scenarios may be created of the potential financial impact of temporarily and permanently changing ports. Factor relevance The weight assigned to each factor will depend on the nature of the industry which is considering this alternative. [...]

[...] Being fairly large, these ports provide good infrastructures and service levels. However, the lead time is subjected to decrease if the consumption of the imported good is not in the Southwest for areas such as the East Coast or Midwest. The possible cost reduction will depend on the industry and the market in which the company operates. In California, being fairly close to Los Angeles-Long Beach ports, Oakland and San Diego are natural alternatives to be considered. The switching costs may be smaller than relocating to the Northwest, and the move relatively easy. [...]

[...] If lead times increase, inventory levels will also increase to maintain customer service level targets. Potential sources of information for this factor include studies of port operations, shipping, railroad and trucking companies. Costs The following aspects may be considered for costs: Shipping rates to new port destination. Inland transportation costs which may include railway and/or trucks. If the company has distribution centers near LA Port, what decisions must the company take in the short and long term regarding decreased return on assets and new DC investments in the long term for new Port options. [...]

[...] These actions included: 1. Hiring of 4500 part time workers to complement a workforce of 8,600 already in the LA Port The PierPASS program to create an incentive to use off peak hours for unloading Promoting the use of on-dock rail to reduce traffic congestions Investments by railroad companies: BNSF $ 1.9 billion in equipment, employees and track and UP has hired 5,550 employees system wide, more hiring of conductors and having 40% of their road doubletracked with a forecast of 60% for 2007. [...]