Imagine midnight in most cities when residents are fast asleep, yet the Port of Los Angeles remains brightly illuminated. The symphony of cargo ships unloading, truck engines roaring, and gantry cranes operating creates a bustling scene. This isn't science fiction but the U.S. government's vision for a 24/7 supply chain operation. However, the gap between ambition and reality reveals multiple challenges that must be overcome before true around-the-clock operations can be achieved.
The Push for 24/7 Operations
The Biden administration's 24/7 operational plan aims to alleviate supply chain bottlenecks and enhance port efficiency. Gene Seroka, Executive Director of the Port of Los Angeles, emphasizes that commitment from industry leaders is crucial and calls for more businesses to join this initiative. However, before this vision becomes reality, the port faces numerous hurdles. Seroka acknowledged during a virtual briefing that extensive discussions with terminals, labor unions, railroads, shipping companies, trucking firms, importers, and exporters are necessary before officially declaring 24/7 operations.
"This isn't a simple switch that opens all doors with one press," Seroka noted. Nevertheless, leveraging data, strengthening stakeholder relationships, and securing federal support are key to transitioning quickly to continuous operations. John Porcari, the U.S. Port Envoy, added that current commitments are just the starting point, with tactical implementation being the next phase.
Key Challenges to Overcome
1. Private Sector Participation
Any operational changes require widespread private sector involvement. Porcari stressed that the federal government's role is to facilitate dialogue rather than regulate. The Port of Los Angeles collaborates with over 200,000 importers and exporters, relying on approximately 18,000 truck drivers, more than 100 trains, and 20+ shipping companies. Additionally, ten new companies have recently begun leasing their own vessels, adding complexity to port operations.
Seroka explained that the port will refine processes incrementally through meetings, calls, and container movements to improve delivery efficiency. This necessitates stronger partnerships, optimized information sharing, and flexible solutions.
2. Optimizing the "Push System"
To clear container backlogs, the port is testing a "push system" that incentivizes truckers, shippers, and cargo owners to engage in "dual transactions." This approach requires trucks carrying imported goods to simultaneously transport export goods or empty containers on return trips, maximizing capacity utilization.
Seroka believes that consistent cargo movement, similar to early collaborations with rail partners, can free up terminal space for faster vessel processing. This demands smarter scheduling systems, more efficient loading processes, and attractive incentives.
3. Exploring Temporary Solutions
Beyond long-term 24/7 goals, stakeholders are considering interim measures to accelerate cargo flow. One proposal involves establishing "inland pop-up yards" for temporary container storage. Porcari suggested that utilizing public or private land for such yards could provide short-term relief, requiring coordination between government, businesses, and communities to ensure safety and efficiency.
4. Maximizing Existing Resources
During the transition, the port is focusing on optimizing current resources. While truck drivers and dockworkers already demonstrate high productivity, Seroka sees potential in better utilizing off-peak hours for cargo movement. With 62 container ships waiting offshore and 25 more en route, flexible scheduling and improved equipment usage are essential.
5. Implementing Off-Peak Operations
Nighttime cargo unloading requires dockworkers, truckers, and warehouse staff to adapt to overnight shifts. Addressing labor costs, safety protocols, and transportation logistics is critical. Initial steps involve terminals and unions negotiating nighttime procedures, with each terminal potentially developing unique operational standards.
6. Warehouse Adjustments
Warehouse operators partnering with the port may need to modify processes for nighttime deliveries. Many facilities traditionally operate only during daytime hours, requiring investments in lighting, security, and staffing to align with 24/7 supply chain demands.
7. Workforce Retention and Recruitment
Seroka emphasized that truck drivers, dockworkers, and warehouse staff are vital to port operations, yet workforce shortages are impacting productivity. Efforts are underway to recruit and compensate these workers more effectively. Porcari noted that the federal government is working with states to streamline commercial driver's license approvals, while the International Longshore and Warehouse Union has expanded its workforce and training programs since March 2020.
8. Enhancing Data Transparency
Porcari highlighted that supply chain efficiency depends on its weakest links, requiring real-time data on container dwell times to assess progress. Tracking containers across terminals, railroads, and shipper facilities demands stakeholder cooperation in data sharing. Tools like Port Optimizer can help identify bottlenecks and improve system-wide performance.
9. Building Long-Term Resilience
The pandemic exposed vulnerabilities in U.S. supply chains, prompting considerations for long-term resilience. Porcari stated that infrastructure must be future-proofed to handle growing demands, emphasizing the need for multiple gateway ports and robust inland transport systems. Federal collaboration with states and potential infrastructure legislation could play pivotal roles in these developments.
"This isn't your grandfather's supply chain," Porcari remarked, "yet in many cases, we're still using your grandfather's infrastructure." Whether the Port of Los Angeles can overcome these challenges and transform into a 24/7 operation will significantly impact both U.S. supply chain efficiency and global trade dynamics.