Shopper alert! Will labor strike at L.A. ports mean bare shelves?
The holiday inventory is already in place, but goods for the post-Christmas sales are bottled up off the coast of Los Angeles, as container ships from Asia go unattended due to a six-day labor strike.
The labor strike at the ports in Los Angeles and Long Beach, Calif., the two biggest ports in the US, probably won't keep toys and TVs off the shelves for the holiday season, but it is likely to affect white sales and other annual post-Christmas mega-bargains if it is not resolved soon.Skip to next paragraph
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Besides hitting retailers, many analysts say, the six-day-old strike is beginning to disrupt the just-in-time supply chains of US manufacturers, as container ships that should offload in L.A. are stuck in the ports or moored offshore with no one to unpack goods ultimately destined to travel by truck or rail to inland factories and plants.
Because of the strike's potential to damage the economy, calls are becoming more urgent for a resolution of the labor dispute between the International Longshore and Warehouse Union (Local 63 Office Clerical) and some of the world’s biggest shipping lines and terminal operators, who have operations at the two ports. The ports account for at least 40 percent of total imported containerized cargo for the United States.
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“This cannot continue," Los Angeles Mayor Antonio Villaraigosa said Monday in a stiff missive to both sides. "With thousands of members of other ILWU locals now honoring the picket lines,” the strike is “costing our local economy billions of dollars,” he wrote to the union. “The cost is too great to continue down this failed path,” said Mr. Villaraigosa, who is asking for 'round-the-clock mediation.
Experience shows that the effects of such a strike can be long-lasting. It took retailers about six months to recover from a 10-day lockout of longshoremen at several West Coast ports in 2002, Jonathan Gold, vice president of supply chain and customs policy for the National Retail Foundation, told The Sun newspaper in San Bernardino, Calif.
"This shutdown of the ports doesn't just impact the retail industry," Mr. Gold is quoted as saying. "You've got manufacturers who are operating just-in-time supply chains, and you've got exports that aren't moving because the ports are shut down. We need it to end now because it's going to take some time to clear through the backups."
Ten of 14 cargo-container terminals at the two ports are shut down. (Los Angeles is No. 1 in container traffic and Long Beach is ranked second, according to industry data.) As of Monday, nine ships are in dock unattended, 11 more are moored offshore, and at least three have been diverted to other ports. Others inbound from Asia are biding their time.