Ports America files for bankruptcy in Oakland

Spokesmen for the Port of Oakland said they were blind-sided by Ports America Outer Harbor’s decision to file bankruptcy. The sudden move follows by 14 days an announcement that Ports America Outer Harbor is withdrawing from Oakland on March 31.

The firm operates one of five marine terminals at the port, and was key to welcoming the much-heralded arrival of one the world’s largest container vessels last month.

“We’re deeply disappointed in the action by Ports America,” said Port of Oakland Executive Director Chris Lytle. “They made a decision to close their business in Oakland. Since then, we’ve been negotiating with them in good faith for a smooth, orderly transition that protects the interests of shipping lines, cargo owners and others who depend on the terminal. It’s a shame they’ve taken this step.”

The Outer Harbor LLC, formerly known as Ports America Outer Harbor, filed for Chapter 11 protection in U.S. Bankruptcy Court in Delaware. Meanwhile, the port maintains it will work to ensure the terminal’s shippers aren’t “left adrift” by the decision.

The port said it is finalizing plans to redirect ships and cargo to other Oakland marine terminals when Port America Outer Harbor closes. “We’ll find a home for all of the cargo that was going to Ports America Outer Harbor,” said Lytle. “We’ll implement measures to improve cargo-handling processes and make this transition successful.”

Some shippers remain skeptical, however, suggesting that problems with dockside productivity will make Oakland less attractive in the future.

“Ports of America is pulling out because their Oakland operation was losing money with no improvement on the labor front in sight,” said Rich Eber, a retired freight forwarder who remains active in the Bay Area shipping community.

A group of shippers comprising the Efficiency Task Force has also insisted that trucks get in and out of its marine terminals in less time.

Members recently met with port authorities to call for a 90-minute maximum wait time for harbor drivers.

“If we’re going to be the best port on the West Coast of the U.S., let’s shoot for this target,” said Scott Taylor, head of the Task Force’s metrics subcommittee and CEO of GSC Logistics, one of the largest trucking firms at the Port of Oakland. “There’s a lot of work to do, but we can get there.”

Trucker wait times - turn times in industry vernacular - were one of several measurement benchmarks proposed by the Task Force. Among others: a call for at least 80 percent of the port’s chassis fleet to be available at all times. The lack of chassis, trailers that transport containers over the road, contributes to driver delays.

Timely cargo flow has emerged as a concern for importers and exporters as Oakland container volume grows. Some say drivers wait more than two hours at marine terminals to pick up loads. Here’s the benchmark proposed by the Task Force to address the concern:

• Drivers should wait no more than 45 minutes to complete single transactions such as picking up imports or delivering exports.
• They should wait no more than 90 minutes for dual transactions.

The proposed benchmarks come from a Task Force assembled by the port in 2015 to improve cargo-handling performance. Committee members, all port stakeholders, said measurement standards are needed to improve cargo-handling speed and efficiency. The port said it will review the proposals in time for the next Task Force meeting in March.

The Efficiency Task Force said it’s also exploring a mandatory appointment system for the port’s marine terminals. The system would require truck drivers to schedule a time to pick up or drop off containers. Its goal: shorten queues that often form outside terminal gates.