Federal mediators from Washington DC are reported to have helped broker a tentative agreement following a breakdown in negotiations last weekend.
With 10 out of the 14 container terminals between the two ports at a standstill and vessels being rerouted via other West Coast ports, the news that the stalemate could be at an end is welcome, not least to the automotive industry, which was facing imminent shortages of parts.
While finished vehicle terminals have remained open, including those operated by Nissan and WWL at LA and by Toyota at Long Beach, automotive parts coming into the two parts was affected according to a spokesperson for the port of Long Beach.
“About 40% of the imported auto parts coming into this country comes through these ports,” he said. “So very shortly, there could be parts shortages.”
Carmakers have been looking at supply contingency measures.
“We continue to monitor the impact of the port strikes in Los Angeles and Long Beach on our manufacturing operations,” said a spokesman for GM. “We're investigating appropriate countermeasures, but at this point we do not anticipate any disruptions at our plants.”
The strike action started a week last Tuesday when 600 ILWU-affiliated clerical workers walked off the job because of a dispute over contracts. According to the ILWU the workers have been without contracts for two years and their jobs are threatened by outsourcing. As many as 10,000 longshoreman and other union members refused to cross picket lines, which brought the terminals at the two ports to a standstill.
“Pickets are not affecting work on the vehicle terminals as far as we can tell,” said a spokesperson for the port of LA said on Tuesday, [and] “we do not have any terminal, rail or road congestion which would affect vehicle or break bulk equipment deliveries,” he added.
However, the overall economic impact of the strike has been estimated to be more than $1 billion a day.
“This dispute has impacted not only our workforce but all stakeholders who ship goods through our complex and potentially the hundreds of thousands of jobs that are directly and indirectly related to port operations. In today’s shipping environment, we can’t afford to lose cargo or our competitive advantage,” said port of Los Angeles executive director, Geraldine Knatz
Talks broke down last weekend when employers walked out of negotiations according to International Transport Workers’ Federation, an affiliate of the ILWU.
Acting general secretary of the ITF, Stephen Cotton said: said it condemned the walkout as “unprofessional conduct” that was harming “the port and its working communities”.
However, the LA/Long Beach Harbor Employers Association (HEA), which represents shipping agencies and terminal operators in Southern California, termed the demands of the clerical workers union local as “featherbedding” and said the further concessions it had put on the table were rejected by the ILWU. These, according to the HEA included the requirement that employers call in temporary workers and hire new employees even if there is no work for them to perform.
Picture courtesy of the Port of Long Beach