RILA Urges East Coast Ports and Longshoremen to Reach Deal before Deadline 

The ongoing labor negotiations affect 14 East and Gulf Coast ports, which together account for 95 percent of all containerized shipments to the Eastern seaboard. A work stoppage early in the New Year would have the greatest impact on the spring shopping season.

“I write to encourage you to bring contract negotiations to a resolution that ensures the uninterrupted flow of cargo through the Gulf and East Coast Ports. A failure to reach an agreement in advance of the December 29 deadline would not only result in hardships for retailers and their customers, but also for the ports and the millions of workers that count on an uninterrupted supply chain to earn their living,” said RILA President Sandy Kennedy.

The impending deadline for negotiations on the East Coast comes on the heels of a week-long strike at the Ports of Los Angeles and Long Beach, which stranded millions of dollars’ worth of cargo off shore, and threatened to cause considerable economic damage.

“Given the critical importance of port operations in the supply chain, any disruptions in that link would have a significant and cascading effect as retailers would be forced to reroute cargo to other ports, resulting in delays and significantly increased costs.  For example, the work stoppage that occurred in Southern California stranded hundreds of millions of dollars of cargo offshore and tens of thousands of workers sat idle because of the strike at the Ports of Los Angeles and Long Beach.  The consequences and repercussions of this stoppage are already proving to leave an adverse impact on our economy,” added Kennedy.

RILA is the trade association of the world’s largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers domestically and abroad

View the letter here.

Full Text of the Letter Below

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December 5, 2012

Mr. James A. Capo
Chairman and Chief Executive Officer
United States Maritime Alliance, Ltd.
485C US Highway 1 South, Suite 100
Iselin, New Jersey 08830

Mr. Harold J. Daggett
President
International Longshoremen’s Association
5000 West Side Avenue, Suite 100
North Bergen, NJ 07047

Dear Mr. Capo and Mr. Daggett:

On behalf of the Retail Industry Leaders Association (RILA) and its member companies, I write to encourage you to bring contract negotiations to a resolution that ensures the uninterrupted flow of cargo through the Gulf and East Coast Ports. A failure to reach an agreement in advance of the December 29 deadline would not only result in hardships for retailers and their customers, but also for the ports and the millions of workers that count on an uninterrupted supply chain to earn their living.

By way of background, RILA is the trade association of the world’s largest and most innovative retail companies. RILA members include more than 200 retailers, product manufacturers, and service suppliers, which together account for more than $1.5 trillion in annual sales, millions of American jobs and more than 100,000 stores, manufacturing facilities and distribution centers  domestically and abroad.

RILA’s membership consists of some of the largest users of the supply chain. Given the critical importance of port operations in the supply chain, any disruptions in that link would have a significant and cascading effect as retailers would be forced to reroute cargo to other ports, resulting in delays and significantly increased costs.  For example, the work stoppage that occurred in Southern California stranded hundreds of millions of dollars of cargo offshore and tens of thousands of workers sat idle because of the strike at the Ports of Los Angeles and Long Beach.  The consequences and repercussions of this stoppage are already proving to leave an adverse impact on our economy. Even though the strike ended late last night, it will eventually result in billions of dollars of damage. A similar stoppage on the East and Gulf coasts would result in an estimated $1 billion of damage to the U.S. economy per day.

Additionally with more lead time, and in the absence of certainty over the outcome of the negotiations or assurances of uninterrupted port operations, retailers have no choice but to continue to anticipate a shutdown of Gulf and East Coast Ports. Supply chain modifications of this magnitude are not desirable to retailers because they take time both to implement and to reverse.

It is vital that a disruption of business is prevented on the Eastern seaboard to avoid further negative impacts on our fragile economy. As the negotiations continue, RILA strongly encourages both parties to recognize the magnitude of impact that a stoppage would have on retailers if a contract was not negotiated by the end of the month.  We are hopeful that both sides can come to an agreement.  If you have any questions or concerns, please contact Kelly Kolb, vice president of government affairs at (kelly.kolb@rila.org) or 703.600.2064.

Sincerely,

Sandra L. Kennedy
President