Mark your calendar for Wednesday, June 11, 2014. Two executives from the Port of Oakland, Chris Lytle, Executive Director, and John Driscoll, Director of Maritime, will be in Reno to address the opportunities and benefits the port provides to the Northern Nevada as well as the challenges being faced and addressed by the port.
We will follow up with more details, and we look forward to seeing you there.
We’ve said it before…the international ocean transportation environment has changed. There is less money for the ocean carriers which leads to less money to the terminal operators which leads to inefficient operations which leads to the burden being placed on the driver. This practice is NOT sustainable. The driver cannot be expected to shoulder the cost of the inelasticity in the supply chain.
We cannot continue on in a “business as usual” fashion. We cannot persist in asking drivers to “be patient.” The time for such is behind us. We need to evolve, or it will be done for us.
On the 12th of this month, the International Longshore & Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) will begin negotiations on the labor contract encompassing US West Coast port operations. The current contract is set to expire on June 30, 2014.
Bill Mongelluzzo, Senior Editor, Journal of Commerce spoke at a WIL/PMSA luncheon last week and surmised the contract will not be agreed upon by the end of the current contract. Once the contract expires, ILWU members are not held to the same anti-strike clauses and, therefore, have more leverage in negotiations. While a strike is not expected, we will likely see slowdowns and temporary work stoppages up and down the West Coast as is typical during negotiations.
The biggest points of contention in this year’s negotiations will be jurisdiction and the tax on the ILWU’s “Cadillac” healthcare plan. As we have seen in Portland and Oakland, the ILWU is very concerned about the work performed by other unions on the docks. While the IAM, IBEW and others have performed work at marine terminals since the 1930’s, the ILWU is looking to solidify their position. While automation may be taking an ever-increasing role, mechanic positions are going to be needed to maintain and repair even automated equipment.
As it relates to the ILWU healthcare plan, the Affordable Care Act (aka Obamacare) allows “Cadillac” plans to be taxed beginning in 2018. The ILWU’s healthcare plan is considered “Cadillac” as members pay no premiums and the only co-pay they encounter is $1 for prescriptions. Because of the value of their plan, the tax adds up to a whopping $150,000,000-$160,000,000. That’s not a typo. It is 150-160 million dollars. The PMA is willing to talk about sharing the cost, but the ILWU is not receptive to that concept. Because of the growing discontent with Obamacare and the effective date of the tax being four years out, by negotiating a three-year contract term versus a six-year term, it is possible the two parties can table the discussion until such a time this portion of the law is revisited and the point moot.
California’s farmers are under increasing pressure to reduce the water they use or pay exorbitant prices. Being that we like to eat and not go broke doing so, we found this flyer created by the California Rice Commission quite interesting….
Pictured above: Robert St. John, Driver/Driver Trainer
Our outstanding safety record is again receiving praise and recognition. The California Trucking Association (CTA) presented Devine with a Fleet Safety Award at a recent banquet.
Congratulations to all of our drivers for their continued safe operations and our safety team for going above and beyond and ensuring we always put the best drivers on the roadways.
Do you know what this part is? It is something used in intermodal or truck transportation. Play “Name That Part” by liking us on Facebook. Click here to go to our Facebook page and place your guess. Good luck!
CARB Considering Zero Emission Standards
With the largest threshold of requiring 2007 or newer trucks behind the drayage truck industry, we need to be looking ahead. The next deadline is January 2023 which currently requires the use of 2010 or newer trucks to service California’s ocean and rail terminals. However, there is a big push for the state to move towards zero emission heavy-duty trucks. Alternative fuels, hybrids and fuel cells are the technologies that rank at the top of the list. The challenge is not putting the cart before the horse. These technologies have to be developed and their success ensured before regulations for their use can be written and implemented.
There has been quite a bit of talk recently about near-shoring or re-shoring, which is the transition of sourcing manufactured products from Asia to sourcing these products closer to home or even at home. Mexico has a seen influx of manufacturing in recent years and remains the United States’ largest trading partner. However, crime and corruption continue to plague the country and inhibit its growth as a manufacturing powerhouse. Interestingly, in a recent study of manufacturing competitiveness, the US ranks second behind China. China’s position as the global manufacturing behemoth continues to be under siege by rising labor costs, increased transportation costs and stagnant productivity. Meanwhile, back in the US, the reasons for our growing competitiveness is the fall in domestic natural gas prices, rise in worker productivity and stable wage growth.
Hush Puppies are so named because hunting dogs in the South were fed fried cornmeal balls to keep them quiet.