Post by HardTimeTrucker on Dec 19, 2008 20:30:46 GMT -5
The JOURNAL of COMMERCE
Maersk to exit Charleston
December 18, 2008
Maersk Line said it will transfer its Charleston calls to other ports during the next two years because International Longshoremen's Association locals at the port refused to allow the carrier's terminal work to be transferred to non-union state workers.
The carrier, which accounts for one-fourth of Charleston's volume, had threatened to move its operations if it could not reduce its costs. Since the economy turned down, Maersk has been paying shortfall fees for failing to meet the volume commitments in its contract with the South Carolina State Ports Authority.
Maersk supported a ports authority proposal to transfer the carrier's operations from an ILA-staffed section of the terminal that's used exclusively by Maersk to a common-use area operated by non-union employees of the port authority.
The port's three ILA locals rejected the transfer last week, saying it would cost union jobs.
In an announcement Thursday, Maersk said it had told the port authority that it would leave Charleston and return its dedicated terminal to the authority on Dec. 31, 2010, when its current contract expires.
Maersk said it would move one service, the South Atlantic Express, representing about 25 percent of its Charleston port calls, to other nearby ports in early 2009. "The remainder of our services will be transitioned strategically over the next two years in very close coordination with our customers," the company said in a statement.
"The South Carolina State Ports Authority offered us a workable solution that involved a move into the common yard, but we needed the consent of local ILA to accomplish the move," said Dana Magliola, a spokesman for Maersk. "The local ILA refused to consent, and so we are forced to move. By moving to other regional ports, we will once again be able to compete on a level playing field with other ocean carriers while continuing to provide excellent service to our customers."
At Charleston, state employees operate dockside cranes and all container-lifting equipment. ILA workers hired by stevedores perform shipboard work and gate activities in terminal sections used exclusively by Maersk, Evergreen, the CKYH carriers and Atlanticargo at dedicated spaces on port terminals. Other operators use common-user areas staffed by non-union state employees.
"Bearing the cost disadvantage between our situation and that of our competitors...is unsustainable," Magliola said. "It would be unfair to our shareholders, customers and our employees to continue to operate in this environment."
Maersk said that during the transition to other nearby ports, it would honor all contractual relationships.