A labor dispute at ports on the US west coast is disrupting supply chains across the Pacific, forcing some Asian suppliers to resort to costly air freight and pushing up shipping rates, as more freighters are caught up in long lines to dock.
With ports near gridlock and cargo delays being felt throughout the nation’s economy, US President Barack Obama on Saturday dispatched US Secretary of Labor Tom Perez to California to try to broker an agreement on a new contract between dockworkers and the group representing shippers and terminal operators.
Ports along the coast, which between them handle nearly half of all US maritime trade and more than 70 percent of imports from Asia, have been experiencing severe delays since October, and the effects are rippling far beyond the US.
Japan’s Honda Motor Co said on Sunday the firm would slow production for a week at plants in Ohio, Indiana and Ontario, Canada, as parts it ships from Asia have been held up by the dispute, affecting models including the Civic, CR-V and Accord.
“We do not have a sufficient supply of several critical parts to keep the production lines running smoothly and efficiently,” company spokesman Mark Morrison said.
Honda and other carmakers have already started transporting some crucial parts from Asia to their US factories by airplane.
Fuji Heavy Industries Ltd, maker of Subaru cars, said it would continue flying parts to its US factory beyond an initial arrangement through the end of this month, which it previously said would cost an extra ￥7 billion (US$59 million) per month.
Toyota Motor Corp, which built about 2 million vehicles in North America last year, said it has reduced overtime at some factories as a result, while Nissan Motor Co Ltd said it had been slightly affected.
With dozens of ships caught up in lines for miles along the west coast, many waiting more than a week, the rates to charter container ships have begun to climb.
“The strike is affecting a lot of vessels. There’s a lot of delays, and this is pushing up Panamax [container] rates, as fewer ships are available for new orders,” a leading Singapore-based broker said.
A Shanghai index for US west coast freight rates rose 23 points last week to 2,265, and brokers said quotes had risen a further five points yesterday.
The dispute is also affecting volumes. Singapore-listed Neptune Orient Lines Ltd’s container shipping unit reported an 8 percent decline in the fourth quarter, partly due to fewer trans-Pacific sailings as a result of the congestion.
Hong Kong Liner Shipping Association secretary Roberto Giannetta said the effects were being felt across the industry, as shippers looked for ways around the delays.
Even if the dispute is resolved, there could be long-term consequences for the ports and the communities that depend on them.
“Trust in west coast ports is at an all-time low, and the perception of supply chain risk is at an all-time high,” said Peter Tirschwell, chief maritime analyst at the JOC Group Inc, a supplier of US seaborne trade data. “We are entering another period of fundamental supply chain re-evaluation that is already leading some shippers to permanently abandon the west coast.”
The Eurovision Song Contest has seen a surge in punter interest at the bookmakers, becoming a major betting event, experts said ahead of last night’s giant glamfest in Basel. “Eurovision has quietly become one of the biggest betting events of the year,” said Tomi Huttunen, senior manager of the Online Computer Finland (OCS) betting and casino platform. Betting sites have long been used to gauge which way voters might be leaning ahead of the world’s biggest televised live music event. However, bookmakers highlight a huge increase in engagement in recent years — and this year in particular. “We’ve already passed 2023’s total activity and
BIG BUCKS: Chairman Wei is expected to receive NT$34.12 million on a proposed NT$5 cash dividend plan, while the National Development Fund would get NT$8.27 billion Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday announced that its board of directors approved US$15.25 billion in capital appropriations for long-term expansion to meet growing demand. The funds are to be used for installing advanced technology and packaging capacity, expanding mature and specialty technology, and constructing fabs with facility systems, TSMC said in a statement. The board also approved a proposal to distribute a NT$5 cash dividend per share, based on first-quarter earnings per share of NT$13.94, it said. That surpasses the NT$4.50 dividend for the fourth quarter of last year. TSMC has said that while it is eager
‘IMMENSE SWAY’: The top 50 companies, based on market cap, shape everything from technology to consumer trends, advisory firm Visual Capitalist said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was ranked the 10th-most valuable company globally this year, market information advisory firm Visual Capitalist said. TSMC sat on a market cap of about US$915 billion as of Monday last week, making it the 10th-most valuable company in the world and No. 1 in Asia, the publisher said in its “50 Most Valuable Companies in the World” list. Visual Capitalist described TSMC as the world’s largest dedicated semiconductor foundry operator that rolls out chips for major tech names such as US consumer electronics brand Apple Inc, and artificial intelligence (AI) chip designers Nvidia Corp and Advanced
Pegatron Corp (和碩), an iPhone assembler for Apple Inc, is to spend NT$5.64 billion (US$186.82 million) to acquire HTC Corp’s (宏達電) factories in Taoyuan and invest NT$578.57 million in its India subsidiary to expand manufacturing capacity, after its board approved the plans on Wednesday. The Taoyuan factories would expand production of consumer electronics, and communication and computing devices, while the India investment would boost production of communications devices and possibly automotive electronics later, a Pegatron official told the Taipei Times by telephone yesterday. Pegatron expects to complete the Taoyuan factory transaction in the third quarter, said the official, who declined to be
RSS