Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
In the end, the allure of running the whole shooting match at the Port of Oakland was
strong enough to persuade J. Christopher Lytle, the executive director of the Port of Long Beach, to jump ship.
Lytle, 67, surprised virtually everyone late last month when he announced he would leave the nation's second
busiest port in mid-July to run the Port of Oakland, Oakland International Airport, and the facility's real estate operations.
For Lytle, a maritime veteran, this represents his first crack at running an airport. The added responsibility was a
key factor in his decision to take the Oakland post, he said. "I wasn't out there looking for a job," he said, noting that
he was approached about the position.
Lytle's last day at Long Beach is July 19, and he expects to be running Oakland on July 22. The five-member
Long Beach Board of Harbor Commissioners is soon expected to elect an interim replacement.
Lytle worked in Oakland from 1992 to 1995 when he ran then Sea-Land Service Inc.'s West Coast operations at the port. When
Lytle leaves Long Beach, he will have been there nearly seven years. He was named executive director in November 2011.
In an interview, Lytle said he will work to convince businesses that Oakland should be the first West Coast port of call for
import traffic. To do that, he will push for improvements to on-dock rail service, he said.
Lytle's said one of his priorities will be to lessen the port's near total-reliance on containerized traffic by diversifying
into areas like break bulk and even dry bulk. Oakland is one of the few U.S. ports that processes more exports than imports, a
trend that Lytle wants to promote. Oakland benefits from its proximity to California's verdant Central Valley, a mecca for
foodstuffs that are in increasing demand from export markets.
Lytle will move from a port that handles slightly more than 6 million twenty-foot equivalent units (TEUs) a year to a
port that handles about 2.4 million TEUs annually. At the same time, Oakland's smaller size means its terminals are less
congested than Long Beach's, giving Lytle and his team more room to be agile, he said.
Lytle said he has no plans to turn Oakland into the Long Beach of the north. Instead he will, among other things, promote
Oakland's capabilities to customers whose cargo requires specialized handling.
Lytle said he is looking at converting a nearby army base into a distribution center to encourage the practice of transloading
that has gained popularity down the coast. At the ports of Los Angeles and Long Beach, the nation's busiest complex, fewer
containers are being loaded on intermodal trains for direct transit inland. Instead, they are trucked to a distribution center
in the nearby Inland Empire to the east, where they are transferred to a 53-foot domestic box for delivery to a local DC and
then onward distribution to the customer.
On the labor side, Lytle, like other West Coast port managers, faces the specter of contract talks next year with the
International Longshore & Warehouse Union (ILWU), a 59,000-member union that represents virtually all of West Coast
waterfront labor. The contract with West Coast ports expires June 30, 2014 but talks are expected to begin in early spring.
LONG BEACH'S FUTURE
Lytle's departure comes at a critical time for Long Beach.
The port is facing increased competition for Asian imports from Vancouver,
British Columbia's Port of Prince Rupert, and Mexico's Port of Lázaro Cárdenas on the country's Pacific Coast. Prince Rupert touts
itself as the fastest way to deliver goods from Asian producing markets to U.S. consuming points in the Midwest and mid-South. Lázaro
Cárdenas is promoting itself as a better alternative to Long Beach for getting Asian goods into the vast Texas market. This is
especially true after Kansas City Southern, the exclusive rail provider between Lázaro Cárdenas and the United States, made track improvements
that promise shippers and beneficial cargo owners (BCOs) equivalent service at lower costs.
Long Beach also faces lingering concerns that the opening of the expanded Panama Canal in 2015 will divert Asian import traffic from West
Coast ports—where goods are railed or trucked inland—to the Canal as part of an all-water route to Eastern ports. Lytle shares the
belief held by many that most of the diversion from West to East has already occurred, and any further shift will be incremental, if it happens at all.
Long Beach is in the second year of a multibillion-dollar program to upgrade its facilities. It is spending $1 billion to expand and improve its on-dock
rail capabilities. It is nearly two years into a nine-year, $1.2 billion project known as the "Middle Harbor" container terminal, designed to renovate and
combine two aging container terminals into one modern facility.
In April 2012, Hong Kong-based ship line Orient Overseas Container Line (OOCL) signed a 40-year, $4.6 billion lease to be the terminal's sole occupant.
It is the largest deal of its kind in seaport history, according to the port. The terminal will also have the most sophisticated IT system ever installed at
any port, Lytle said in an interview in March of 2013.
Lytle also leaves behind more than his share of headaches. Issues like cost, congestion, and labor strife are ways of life at the San Pedro ports that
shippers and carriers have grown accustomed to. Including last year's clerical workers strike, three labor-related disturbances have plagued Long Beach in less
than 11 years.
Another headache appeared Wednesday when the city of Long Beach sued to prevent the city of Los Angeles and BNSF Railway from moving forward on a $500
million rail yard project. The City of Long Beach says the project may jeopardize the health and quality of life of its residents.
Long Beach leaders are also asking the courts to set aside Los Angeles' recent approval of the Southern California International Gateway (SCIG) project and
its environmental impact report, which Long Beach says does not comply with the state's Environmental Quality Act.
Long Beach said the negative effects of the project would be borne almost entirely by residents of West Long Beach.
The number of container ships waiting outside U.S. East and Gulf Coast ports has swelled from just three vessels on Sunday to 54 on Thursday as a dockworker strike has swiftly halted bustling container traffic at some of the nation’s business facilities, according to analysis by Everstream Analytics.
As of Thursday morning, the two ports with the biggest traffic jams are Savannah (15 ships) and New York (14), followed by single-digit numbers at Mobile, Charleston, Houston, Philadelphia, Norfolk, Baltimore, and Miami, Everstream said.
The impact of that clogged flow of goods will depend on how long the strike lasts, analysts with Moody’s said. The firm’s Moody’s Analytics division estimates the strike will cause a daily hit to the U.S. economy of at least $500 million in the coming days. But that impact will jump to $2 billion per day if the strike persists for several weeks.
The immediate cost of the strike can be seen in rising surcharges and rerouting delays, which can be absorbed by most enterprise-scale companies but hit small and medium-sized businesses particularly hard, a report from Container xChange says.
“The timing of this strike is especially challenging as we are in our traditional peak season. While many pulled forward shipments earlier this year to mitigate risks, stockpiled inventories will only cushion businesses for so long. If the strike continues for an extended period, we could see significant strain on container availability and shipping schedules,” Christian Roeloffs, cofounder and CEO of Container xChange, said in a release.
“For small and medium-sized container traders, this could result in skyrocketing logistics costs and delays, making it harder to secure containers. The longer the disruption lasts, the more difficult it will be for these businesses to keep pace with market demands,” Roeloffs said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
As the hours tick down toward a “seemingly imminent” strike by East Coast and Gulf Coast dockworkers, experts are warning that the impacts of that move would mushroom well-beyond the actual strike locations, causing prevalent shipping delays, container ship congestion, port congestion on West coast ports, and stranded freight.
However, a strike now seems “nearly unavoidable,” as no bargaining sessions are scheduled prior to the September 30 contract expiration between the International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX) in their negotiations over wages and automation, according to the transportation law firm Scopelitis, Garvin, Light, Hanson & Feary.
The facilities affected would include some 45,000 port workers at 36 locations, including high-volume U.S. ports from Boston, New York / New Jersey, and Norfolk, to Savannah and Charleston, and down to New Orleans and Houston. With such widespread geography, a strike would likely lead to congestion from diverted traffic, as well as knock-on effects include the potential risk of increased freight rates and costly charges such as demurrage, detention, per diem, and dwell time fees on containers that may be slowed due to the congestion, according to an analysis by another transportation and logistics sector law firm, Benesch.
The weight of those combined blows means that many companies are already planning ways to minimize damage and recover quickly from the event. According to Scopelitis’ advice, mitigation measures could include: preparing for congestion on West coast ports, taking advantage of intermodal ground transportation where possible, looking for alternatives including air transport when necessary for urgent delivery, delaying shipping from East and Gulf coast ports until after the strike, and budgeting for increased freight and container fees.
Additional advice on softening the blow of a potential coastwide strike came from John Donigian, senior director of supply chain strategy at Moody’s. In a statement, he named six supply chain strategies for companies to consider: expedite certain shipments, reallocate existing inventory strategically, lock in alternative capacity with trucking and rail providers , communicate transparently with stakeholders to set realistic expectations for delivery timelines, shift sourcing to regional suppliers if possible, and utilize drop shipping to maintain sales.