Port of Oakland struggles as Ports of America abandons terminal

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Richard Eber

Recent reports in newspapers and on television tell about the multi-billion dollar stevedore firm Ports of America closing down their Oakland operation in the next month.

Even though their facility is so crowded that drivers trying to pick-up and deliver ocean freight containers can wait up to 4 hours in line, they are saying good bye to Oakland. At the same time the Port of Oakland’s public relations arm is postering this is no big deal and other opportunities for use of the property are imminent.

The bottom line is that this whole line of thinking is B.S. Ports of America are pulling out because the slowdown by disgruntled workers from the International Longshoreman’s and Wharehouseman’s Union ILWU has adversely affected operations at the port for over a year.

While a tentative agreement was reached in February of 2015 it was not ratified until May of last year. Since that time congestion at the Port of Oakland continued to cause delays for vessels calling the port loading and unloading vessels.

While members of the ILWU continued to draw their paychecks, Stevedores and ship owners have been left holding the bag so to speak. Even though traffic going through the port decreased about 7% last December, the place is still a mess.

Port’s of America which is in business to make a profit, simply has had enough. They are headed to greener pastures.

As an example last week part of the terminal was closed by the ILWU in a sympathy strike for an action of the radical Occupy Oakland political group. Ports of America is pulling out because their Oakland operation was losing money with no improvement on the labor front in sight.

Meanwhile the Port of Oakland is spinning a fantasy tale of new business opportunities in the abandoned terminal. With the constant flow of trucks along the Maritime Street corridor, what companies would want to invest in this area adjacent to the Bay Bridge? Their best chance for using the closed Outer Terminal facility is to entice another stevedore to fill the space.

As for other non-maritime businesses to lease the port area, the only entity to likely do this is the Oakland A’s. Were they to use port land for a new baseball park, it probably would have a location in close proximity to Jack London Square. In the past Howard Terminal has been suggested for this.

Even then it might take at least 10 years to deal with environmental impact reports and lawsuits from every imaginable local group before the site could be shovel ready.

In the meantime the port should concern itself with the real cause of Ports of America’s departure and deal with the hostile labor conditions that threaten long term growth and vitality of maritime business in Oakland. Given the critical situation, it is unfathomable the politically sensitive port is acting like they have a P.R. crisis rather than dealing with business conditions that threaten their survival.

While planned Saturday Gates will reduce congestion, they will also bring additional expenses for terminal operators having to pay time and a half to workers.

With mega vessels carrying up to 15,000 containers being the wave of the future, it is imperative that wherever they call does not have labor slowdowns, sympathy strikes, and low worker morale.

Outside of stevedore’s, shipping companies such as Maersk, Hapag-Lloyd, MSC, will not tolerate their vessels standing around idol at $250,000 a day while unions complain about how poorly they are being treated.

There are not only other West Coast ports such as Long Beach, Los Angeles, Tacoma, and Seattle ready to handle business currently transiting through Oakland but East Coast facilities as well that will be glad to take on additional tonnage.

In addition the Port of Oakland needs to make improvements in their rail connections between terminals and where the containers are unloaded off stack trains. This is not an easy task as the Union Pacific and Burlington Northern as virtual monopolies have little incentive to invest in modernizing their facilities. To do so will take a great deal of effort from the Port , State of California, and the railroads themselves.

It would seem there would be a public outcry to increase rail traffic and reduce trucks coming in and out of the port because of pollution caused because of this movement. In recent years outside of new EPA regulations cutting greenhouse gases from diesel trucks, the port of Oakland at the same time has reduced the number of warehouses near to where the ships unload. As a result more trucks clog the highways going in and out of the terminals than ever before.

With this being said the Port of Oakland is an important economic resource the entire Bay Area depends on because billions of dollars of freight imported and exported each month from this hub. Because of this it is important that labor strife be settled and improvements made for the port to reach its needed economical potential.

The future economic vitality of the entire region rests with the outcome.

Editors note- Rich Eber and his late father have worked in the International Transportation business their whole lives