The white paper that I wrote has been picked up by the LA Times.
Basically, the gist is that imports suffered more than exports, so those ports that were more import focused had a much harder time during the recession than those that were more balanced.
Seems reasonable enough, but I was able to show it with math.
La / Long Beach cannot really be faulted, they have dealt with a rising tide of imports and the market changed and caught everyone with their pants down.
It is really easy to say they put all their eggs in one basket, but it was not really a conscious decision. Imports were what the market was demanding and the competitive advantage of LA & LB was imports.
The info that I have goes back to 1995. At that time 41% of loaded containers were exports, 58% were imports.
At the height (2004), 76% was imports and 24% were exports.
Currently, 66% is imports and 33% is exports.
Do you wait for imports to return or do you focus more on exports, even though imports are your competitive advantage?
Monday, March 29, 2010
LA & Long Beach Hurt due to import focus
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2 comments:
Although imports are a competitive advantage, at this point, I don't think they're serving as such. Typically, (kind of what you touched upon) profitability *usually* comes from imports < exports, so when imports are greater, normally profit doesn't follow suit to the same degree had it been the other way around.
I think now that we're not doing as well, maybe we should try going for more exports and turning that into a competitive advantage (obviously, would take some time...) but at least if it works out, we have more control over what's going on, instead of relying on imports proving profitable.
Great point. We should not put all of our eggs into the import basket.
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