Posted at 12:28 p.m., Tuesday, October 1, 2002
Industries feel effect of closed ports
Advertiser News Services
LOS ANGELES Manufacturing, retail and trucking companies are beginning to feel the pinch as U.S. West Coast ports remained closed for a fifth day in a contract dispute.Nissan Motor Co. said it may delay the introduction of the Infiniti M45 sedan, scheduled for Friday, and Yellow Corp., the largest trucker, was planning to ship through East Coast, Southern or Canadian ports. Retailers including Gap Inc. and Wal-Mart Stores Inc. said they're working on ways to cope with a shutdown.
"When we are three, four or five days into a disruption that creates a void," manufacturers must "decide whether to keep assembly lines open," said National Industrial Transportation League Vice President Peter Gatti, whose group lobbies in Washington on freight-shipping issues for General Motors Corp. and about 800 other U.S. companies.
Nissan said a shipment including 350Z sports cars and Infiniti G35 sedans and coupes was due at Long Beach early in the week. Supplies of the cars were tight before the shutdown, so dealers and customers may not receive vehicles on schedule without an opening soon, Nissan spokeswoman Gina Pasco said.
An extended closing would push back the introduction of the Infiniti M45 luxury sedan, Pasco said.
Terminals were closed late Friday and reopened early Sunday, only to shut later that day because slowdowns reduced productivity by 54 percent, the carriers association said. Union Pacific Corp. and Burlington Northern Santa Fe Corp., the two largest U.S. railroads, halted trains with thousands of export shipments.
Avocados from Central America sat in containers in the Port of Tacoma, televisions from Korea remained boxed up in Southern California and car parts destined for a General Motors/Toyota plant in Fremont, Calif., sat unloaded in the water off Oakland.
If those parts don't arrive soon, production at the New United Motor Manufacturing, Inc. factory will stop by week's end, a plant spokesman said.
Importers bringing in merchandise for the Christmas shopping season are nervous.
Sunny Ho-Lap-kee, executive director of the Hong Kong Shippers Council, told the South China Morning Post that the damage "could be catastrophic if it goes on long enough."
Hong Kong ships 4,300 containers each day to the U.S. West Coast.
"We are hopeful of a quick resolution but the docks at Kwai Chung are already packed with the peak-season rush. Nobody knows what the U.S. buyers want us to do right now. We are waiting for the U.S. to decide."
Taiwan's largest shipping company, Evergreen Marine Corp., had two of its six weekly shipments to the West Coast stranded off Los Angeles, unable to unload their hauls, said Elysia Chen, a company spokesman.
"The biggest concern now is for consignees because the goods haven't been taken off the ships," Chen said. But gradually, "this will hurt many parties."
"It's extremely serious," said Robin Lanier, executive director of the West Coast Waterfront Coalition, a trade group representing retailers and shippers.
Retailers anticipating the labor unrest ordered extra inventory, but that means higher storage costs that will reduce profits and potentially stock prices. Ultimately, stores may run out of the most popular products, losing sales in an economy struggling to recover.
"The longer this goes," Lanier said, "the more likely you're not going to have important merchandise on your shelves for the sales period."
Bloomberg News and Associated Press contributed to this report.