TOLD YOU SO

OOCL Golden Gate Bridge

Last month, we reviewed the latest round of ocean carrier mergers and acquisitions. We mentioned there were persistent rumors of COSCO buying OOCL. OOCL consistently denied the rumors. Then, BAM, an agreement was reached for COSCO to buy OOCL for $6.3B.

COSCO plans to keep OOCL as a stand alone company to capitalize on their reputation for providing superior service.

Who’s next?  Pacific International Lines (PIL) seems to be the next takeover target, possibly by COSCO, but PIL is denying the rumors.  Hmmm….

ELD’S SEND TRUCK RATES SOARING

Driver 2134 Rinat Yagudin w New Truck 001

ELD’S AND YOU 

Electronic Logging Devices (ELD) will be required in all trucks beginning December 18, 2017.  Currently, drivers keep track of their hours of service via a manual, paper log. ELD’s, on the other hand, will electronically monitor and record drivers’ on and off duty time.

While Devine enforces a strict policy adhering to the federal hours of service regulations, many motor carriers do not.  For motor carriers and drivers stretching drivable hours, there will be a hard stop with ELD’s, and shipments that used to take two days to deliver may now take two and a half to three days.  The end result is it will take more trucks to move the same amount of cargo, and truck capacity will tighten.

Much of the focus in the industry press has been limited to the affects of ELD’s on the truckload segment, which will certainly be impacted, but the drayage market will face similar constraints.  ELD’s will be required for all interstate truck moves, and all container moves are considered interstate as the cargo came from or is destined for a location outside of your state.

The market is already seeing capacity constrict as motor carriers adopt ELD’s ahead of the deadline.  When capacity decreases, rates increase…basic supply-demand principles at work.

We will keep you posted as the ELD mandate materializes.

HAPPY BIRTHDAY HARRY

Harry Bridges 001

For the most part, marine terminals on the west coast were closed last Friday in honor of Harry Bridges’ birthday. So, who exactly was Harry Bridges?

He was the father of the ILWU. If you remember last month’s story about “Bloody Thursday,” Mr. Bridges was instrumental in planning the strike and was key in negotiating the contract and the eventual formation of the ILWU.

That is why his birthday, July 28th, is an ILWU holiday

NAME THAT PART

Name That Part Aug 2017

Do you know what this part is? It is something used in truck or container transportation.

 

Play “Name That Part” by liking us on Facebook.  Click here to be directed to our Facebook page and place your guess.

 

Good luck!  

ILWU CONTRACT EXTENDED

ILWU Crane Operator View

We have good news to report: It looks like the International Longshore & Warehouse Union (ILWU) will approve a three-year contract extension, thereby, taking the contract out to July 1, 2022. While it is not official, the voting is strongly in favor of the extension (67% pro, 33% against). The union expects to formally ratify the contract extension soon.

There has been quite a bit of focus on both the International Longshore & Warehouse Union (ILWU) and International Longshoremen’s Association (ILA) contract expiration dates. The ILWU’s contract, which covers the entire US west coast, was originally set to expire on July 1, 2019. The ILA’s contract, which covers the US east and gulf coasts, is scheduled to expire September 30, 2018.

Given the back-to-back expiration dates and the fact negotiations go far beyond the last day of the contract, both labor contracts could have been in negotiations at the same time. Historically, labor negotiations have had a negative impact on the fluidity of container flows.

Disruptions on both coasts, at the same time, could have had catastrophic consequences for US exporters and importers. As such, it is no surprise serious angst was developing throughout all industry segments.

Thanks to both the ILWU and PMA for getting this extension done and continuing our relative peace on the west coast waterfront for another five years. Whew!

OUCH, OUCH, OUCH

The days of being entertained by a constant stream of trucks getting stuck under a low bridge, affectionately name “The Can Opener” in Durham, NC are coming to an end.

After years of trying different tactics, the city’s engineers implemented a traffic light which is triggered by over-height vehicles. Signs then direct the driver to an alternate route. While the light has not completely eradicated the problem, it has put a serious dent in our entertainment. For old time’s sake, above is a video compilation of the Can Opener in action.

FROM NORTHERN NEVADA

DRYING OUT IN THE DESERT

Just a few short weeks ago, the playa in the Black Rock Desert, which is home to Burning Man, was under water. The result of a long, wet, drought-breaking winter. Well, revelers’ fears can be allayed. The playa is drying out and should be just as arid and dusty as ever. Enjoy!

 
Southwest Road Trip 2006 - 795 06031619 - Black Rock Desert - Playa

ONE MORE THING

The ports of Los Angeles and Long Beach will increase the PierPass fee to $144.18 per 40′ effective August 1, 2017.  The PierPass program assesses a Traffic Mitigation Fee (TMF) on all loaded container transactions completed during the day shift while the same transactions at night and on weekends are free.

The original goal of the program was to reduce traffic congestion on roadways surrounding the port area.  There has always been quite a bit of discord about the amount of the fee and the lack of visibility of how it is spent.