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Worker shortage eases at LA-Long Beach
Updated
10:50 a.m. ET, Wed May 19, 2004
The JOURNAL of COMMERCE ONLINE
Union Pacific Corp.'s
chief executive told shippers at a meeting Monday in San Francisco that he
could not predict when the railroad's severe congestion problems might
end.
The logjams have been
particularly acute in Southern California, where about one-quarter of
Union Pacific's freight either originates or ends up, much of it import
containers from Asia bound for inland destinations.
A number of companies
that rely on the nation's largest railroad are feeling the effects.
"We've already factored
in a two-day delay in moving our shipments out of West Coast ports, and I
expect that will go up by another day" late this year, Larry Rupp,
shipping manager for computer maker Hewlett-Packard Co., told Bloomberg,
adding that the company is moving some rail-bound shipments by truck.
"That's more expensive," Rupp said, "but we don't have much choice."
The slowdown probably
will persist for the rest of 2004 given the time needed for the railroad
to add crews and equipment, said Rupp, who attended the meeting.
Industry observers said
the lack of guidance on the part of Union Pacific is hurting shippers'
ability to plan for the peak shipping season, amid fears that the surge of
shipments from Asia will overwhelm the bottlenecked carrier.
"All of us are acutely
aware that we have failed to meet our customers' needs," Chief Executive
Richard Davidson told the meeting. "I've resisted the urge to forecast a
specific date as to when everything will be fine."
Union Pacific earlier
this month cancelled a transcontinental contract with United Parcel
Service, after shifting some UPS loads to trucks to avoid congestion. It
also turned away business and raised some rates to ease congestion. |
