Is it in the best interest of Steam Ship Lines to go forward with the current ILA contract extension talks? In my opinion, it is absolutely not.
What is the reason for the extension in the first place? Most say it is to remove an idea from customers and shipper's minds that there could be a strike on the East/Gulf Coast. Other's say it is remove the initial wage increase set to go in effect on Oct 1st of $1.50 an hour. This equals out to be about a 5% increase in cargo through-put rates. This 5% gets paid by the Terminals passed on to the SSL and then onto the shipper in some form. Is this short term money really worth what the SSL's are giving up?
The SSL's are giving up the Container Royalty Cap and raising the minimum hourly rate to $20. The removal of the cap equates to an extra roughly $40million in 2010/11. The increase in the minimum rage is another almost 20% increase in wage pay out. This is a lot of money being given up for just a %5 increase in wages.
Maybe the USMX should rethink this stance instead of moving forward with more talks this week.
About Me
- Transportation Industry Debater
- North East Coast, United States
- I am a transportation executive and have worked in the container shipping industry for most of my career. I have experience in terminal operations, rail operations, vessel operations, liner management, and contract negotiation. I find myself always searching for something new to learn, as well as other professional opinions about different issues, obstacles, and changes with in the industry. I have searched for a forum to discuss these happenings with other professionals but have found none. For this reason I have decided to create my own. I will put up my opinions and hope for the blog to catch on, so I may read others.
September 28, 2009
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