Potential port strikes send ripple effects through supply chain, threaten inflation
Lydia Hu reports on a potential port strike ahead of the holidays on ‘Mornings with Maria.’
The threat of port strikes on the East Coast and Gulf of Mexico is sending shockwaves through the supply chain, and raising concerns that there will be an uptick in inflation.
«Goods trans-shipped across the country are not only going to be late but they will cost more, e.g., apparel meant for early winter and the holidays,» George Kochanowski, CEO of logistics company Staxxon, told FOX Business.
Kochanowski continued, «If the goods were containerized, where will all those empties go and who will pay to have them stored, accounted for, and repositioned? All these costs will be factored in the price of the goods sold.»
The International Longshoremen's Association (ILA) is negotiating on behalf of 45,000 dockworkers at three dozen U.S. ports from Maine to Texas that collectively handle about half of the country's seaborne imports. It warned its members are prepared to stop work if they don't have a new contract by the Oct. 1 deadline.
PORT STRIKES COULD HAVE 'DEVASTATING' IMPACT TO ECONOMY, RETAIL TRADE GROUP SAYS
The issue is that this comes during the most critical time of year for retailers, which told FOX Business that if a new labor deal isn't negotiated by the end of the month, it could have a «devastating impact» on the overall U.S. economy.
A container ship is docked at the Port of Miami on Dec. 27, 2012, in Florida. (Joe Raedle / Getty Images)
Jim Gillis, Pacific region president of IMC, a nationwide trucking company that operates at ports, said he's seeing a «litany of issues related to cargo surges – mainly port congestion and pool chassis shortages.»
It was something they hadn't seen in the previous months.
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