Round-the-Clock Port Program Has Glitches to Work Out

The long-awaited program to keep the ports of Los Angeles and Long Beach, Calif., open late at night is garnering mixed reviews from many importers and freight forwarders.

The extended-hours program was officially launched on July 23. But its complicated computer payment program was delayed until July 29 while a few bugs were being ironed out in the software.

According to several sources, those bugs still exist.

Dick Coyle, president of Devine Intermodal, which has 100 independent truckers working at the ports, said he had four drivers quit the first week of the OffPeak program, operated by not-for-profit organization PierPass Inc.

“Last week, I met with all the drivers, and I did drive in one of the trucks during the nighttime to see what it was like,” said Coyle, whose company picks up cargo for such companies as The Gymboree Corp., a children’s apparel retailer. “We all anticipated real quick turns at the terminals. That was not encountered. We ran into untrained labor and slow-moving gates. The drivers soon became disheartened.”

Coyle said one of his drivers quit to work in a grocery store and he is not sure what the other three drivers are doing.

Last year, an unprecedented port congestion problem forced marine terminal operators at the nation’s largest port complex to devise a program to extend hours beyond the traditional 8 a.m. to 5 p.m. schedule on Mondays through Fridays. During the peak shipping season last year, scores of container ships sat for three and four days waiting to find an empty berth as a flood of goods arrived at the port complex, which handles nearly 45 percent of all cargo arriving in the United States.

Last year, the Port of Long Beach saw its cargo container volume jump by 24 percent to 5.8 million 20-foot containers.

Traffic at the Port of Los Angeles grew less. In 2004, the port handled 7.3 million 20-foot containers, a 2 percent increase over the previous year.

Night owls

When OffPeak started July 23, the port hours expanded to 8 a.m. through 3 a.m. during the week and to 8 a.m. through 6 p.m. on Saturdays. To fund the $160 million budget it takes to keep the port gates open late, companies picking up cargo during weekdays have to pay a $40 fee for 20-foot containers and an $80 fee for 40-foot containers. The program’s computer software system is supposed to keep track of which companies have paid their fees and whether their cargo can be picked up.

Much of the criticism is targeted at the software. Others complain that unskilled labor is working the gates at night. In the past year, 10,000 “casual” dockworkers have been trained to pitch in when the shipping season heats up.

“On [Aug. 1], we had a trucker stuck at a terminal because their system and the PierPass system didn’t show that a payment had been made to pick up the cargo,” said Ernie Stein, vice president of operations for Norman Krieger Inc., a Los Angeles freight forwarder and customs broker. “They refused to let the driver pick up the cargo, and it took 61/2 hours to resolve the issue, costing us $300 in waiting time.”

Enrico Salvo, chief executive of Carmichael International, another Los Angeles freight forwarder and customs broker, had similar problems.

“There are several glitches in the software program so that communications between PierPass and some of the terminals, maybe three or four of them, isn’t working,” Salvo said. “They should have tested it better before making the program go into effect.”

Salvo also noted that many of the terminals are not staffing their night gates with enough people or with trained personnel. “At nights, the pickups are as laborious as during the day,” he observed.

Bruce Wargo, president and chief executive of PierPass, admitted that there are some kinks to be worked out with the software program. But he said he believes the problems will be resolved in the next few weeks.

“We have some technical problems we are working through,” Wargo said from his Long Beach office. “But operationally, it is going great. The original concerns were there weren’t enough truck drivers and nobody wanted to work nights. But 32 percent of cargo is moving during off-peak hours.”

Users of the PierPass system said much of the software problem is concentrated in a few marine terminals. Getting good marks for efficiency were the terminals used by Maersk Inc., Hanjin Shipping and APL.

John Clark, vice president of apparel company Paul Davril Inc., said he is pleased with the system. He uses APL for his shipping.

“I think it is working fine, believe it or not,” said Clark, whose company is paying the daytime fees to import about 10 to 15 containers a week. “The drivers have said that during the day, peak period, it has been smooth getting in and out. I am pleasantly surprised.”