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Expanding Port Operations; Oakland’s Ship Recovery; Saving Christmas Toys

By Paul Page

 

Container ships at the Port of Long Beach on Oct. 1. PHOTO: JAE C. HONG/ASSOCIATED PRESS

The White House is taking new steps to address the backups at Southern California ports that have helped lock up U.S. supply chains. The Biden administration plans to announce a pledge that the Port of Los Angeles will join Long Beach in running 24-hour operations. The WSJ’s Alex Leary reports that Walmart, FedEx and United Parcel Service also are committing to round-the-clock operations there, which the White House hopes will draw smaller truckers and shippers into the extended hours. The administration says those companies taking part will handle a combined 3,500 containers a week at night. That’s just a sliver of the tens of thousands of boxes stuck in a persistent backlog at the country’s largest import gateway complex. But growing numbers of reports suggest supply-chain bottlenecks are hindering the global economic recovery, and the backups in the U.S. are leaving inventories short heading into the critical holiday period.

 
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Transportation

Ships lined up in San Francisco Bay in March to get into the Port of Oakland during a record quarter for container volume at the port. PHOTO: JUSTIN SULLIVAN/GETTY IMAGES

The Port of Oakland is trying to reclaim its place as a linchpin in North American supply chains. Container lines have started to restore services that were pulled back from the California gateway over the summer, the WSJ Logistics Report’s Paul Berger writes, in a sign of the complications that congestion and cargo-handling delays have created in shipping operations. CMA CGM and Mediterranean Shipping Co. are among the lines adding so-called first-call services at the port that could ease some transport pressures on shippers. Oakland has been an alternate destination for operators looking to avoid the growing backups in Southern California, but the flood of imports earlier in the year overwhelmed the port and triggered a big backlog of ships on the water. Exporters anxious for capacity will welcome the new services. But freight executives say ports along the West Coast remain swamped with no easy solutions at hand. 

 

Supply Chain Strategies

John Baker, MGA Entertainment's logistics chief, at the company's distribution center in Hesperia, Calif. PHOTO: DAMON CASAREZ for THE WALL STREET JOURNAL

John Baker is trying to save Christmas. The logistics boss at MGA Entertainment is trying to get the company’s L.O.L. Surprise dolls, Little Tikes cars and other toys out of the traffic jam that has locked down global supply chains. The WSJ’s Paul Ziobro writes that Mr. Baker is one of the many corporate logistics chiefs working behind the scenes as slowdowns hit factory production lines, boxes pile up at ports and ships line up at sea, holding up huge volumes of goods. The problems are testing companies from Nike to Ford to Whirlpool, but the timing is especially crucial for toy makers. Mr. Baker says the company’s CEO has issued near-daily reminders: “Christmas is on December 25.” For MGA, that has meant moving to alternate ports, searching for empty containers, resetting purchasing and shipping terms on the fly, and orchestrating truck and rail movements from overstuffed warehouses.

 
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Quotable

“We’re just running out of time.”

— John Baker, vice president of distribution at toy maker MGA Entertainment
 

Supply Chain Strategies

Tesla cars being loaded on a car carrier in Fremont, Calif. PHOTO: BEN MARGOT/ASSOCIATED PRESS 

Tesla’s ambitions to become a global car maker are waiting for a nod from Germany. Authorities in the country expect to make a decision as early as this year on the electric-vehicle company’s new plant near Berlin, the WSJ’s William Boston reports, as Tesla works to complete the factory while environmental activists continue efforts to derail construction. The stakes are high for Tesla, which would have to tear down all the buildings it has already erected and return the site to its natural state if German officials reject the plan. Approval would trigger a big shift in the company’s supply chains. Tesla now imports all cars sold in Europe from either the U.S. or China. It could build as many as 500,000 vehicles a year at the new site, allowing it to cut logistics costs and gain clout to compete against the growing number of models from European brands.

 
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Number of the Day

$3.25

Average per-mile rate for refrigerated truck transport on the U.S. spot market in September, up 10 cents from the previous record level set in August and up 68 cents year over year, according to DAT Solutions.

 

In Other News

The International Monetary Fund lowered its global economic growth forecast, citing supply chain disruptions and global health concerns. (WSJ)

Aluminum prices are at their highest level since 2008. (Dow Jones Newswires)

U.S. parcel carriers set their recommended dates for customers to ship goods for delivery by the Christmas holidays. (WSJ)

A.P. Moller-Maersk suspended five employees after a U.S. Merchant Marine Academy student alleged she was raped while on a Maersk ship. (WSJ)

Kroger is using its partnership with Ocado to extend its reach with new automated online grocery fulfillment centers in the Northeast, Florida and California. (WSJ)

General Motors says supplier LG Electronics will cover nearly all of the $2 billion cost of recalling Chevrolet Bolts for battery fire risks. (WSJ)

Hasbro CEO Brian Goldner has died just days after he took a leave of absence for medical care. (WSJ)

Former Tesco CEO David Lewis will advise the U.K. government on supply chain issues. (The Register)

Maersk Line is diverting its larger ships again from the U.K.’s Port of Felixstowe because of congestion there. (Financial Times)

China’s Yantian International Container Terminal halted operations along with several smaller ports on the approach of Tropical Cyclone Kompasu. (Lloyd’s List)

Denmark’s Norden says the value of bulk ships has grown 80% so far this year. (Splash 247)

Sweden-based freight forwarder DSV upgraded its outlook for the fifth time this year. (Air Cargo News) 

Tiger Cool Express is pursuing the purchase of a shuttered Union Pacific refrigerated warehouse to help develop a cold-chain intermodal hub in the Pacific Northwest. (Journal of Commerce)

Third-quarter sales at industrial parts supplier Fastenal rose 10% and were up 3.1% from the second quarter. (Industrial Distribution)

An Alabama school district is seeking help from parents after failing to get food deliveries from suppliers. (Birmingham News)

Nordstrom is offering a $2,500 bonus to seasonal workers brought into supply chain and fulfillment center jobs. (Yahoo Finance)

Interactive Analysis projects the warehouse automation market will more than double to $69 billion from 2020 to 2025. (Supply Chain Quarterly)

Excavators unearthed a 1,500-year-old, football field-sized facility in modern-day Israel that produced wine for export. (Reuters)

 

About Us

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @jensmithWSJ, and @pdberger. and @LydsOneal. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
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