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Flexport CEO on how to fix the US supply chain crisis

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Re: Flexport CEO on how to fix the US supply chain crisis

#61
post #50

Earlier quoted context omitted.

> Why don't you have enough trucks? This is addressed later in the thread. Normally, many trucks haul containers to their destination, unload the container, then return it empty to the port, pull it off the trailer, and haul away another loaded container. But the port is too full to accept empty containers, and zoning laws mean truck companies have already maxed out their own container holding areas. This leaves enor…

Why does the empty container have to be taken back to long Beach? Couldn't it be taken literally anywhere else?

Because the empty needs to be either filled and put back on a ship going back to Asia, or put back empty. Either way, all the containers that go from Asia to the US need to go back. And it makes sense for the port that unloads to also load.

Re: Flexport CEO on how to fix the US supply chain crisis

#62
post #50

Earlier quoted context omitted.

Why does the empty container have to be taken back to long Beach? Couldn't it be taken literally anywhere else?

Because the empty needs to be either filled and put back on a ship going back to Asia, or put back empty. Either way, all the containers that go from Asia to the US need to go back. And it makes sense for the port that unloads to also load.

Doesn't seem like it makes sense in this case, though, does it?

Re: Flexport CEO on how to fix the US supply chain crisis

#63
post #60

Related: The mayor of Long Beach has increased the stacking limit. https://mobile.twitter.com/RobertGarcia/status/1451679404757...

It's weird to me that thousands of people work at the docks or with the trucks, and likely understand these problems quite well, but only after a silicon valley guy rented a boat to take a look and tweeted about it did it come to attention of the larger world.

Is it just that these other people don't want to "rock the boat" at their place of employment?

Re: Flexport CEO on how to fix the US supply chain crisis

#64
post #35

Earlier quoted context omitted.

Erm, then pay some truckers to haul empty containers to some space in the middle of Arizona, Nevada, Texas, Idaho, Iowa, etc.? If the problem is empties clogging things up, move the empties. America isn't exactly short of empty space without zoning restrictions. In a week, the yards will be empty. This seems like a problem that money can solve. The fact that money isn't solving it is extremely suspicious. Either it m…

> Erm, then pay some truckers to haul empty containers to some space in the middle of Arizona, Nevada, Texas, Idaho, Iowa, etc.? The empty containers don't need to be trucked to Arizona, they need to be shipped back to China so that they can be filled with more goods and shipped back to LA. There are fewer goods flowing from the US to China though, so they are piling up in LA. Either the price of shipping from US to…

Too bad they didn’t switch to collapsible containers: https://www.shiplilly.com/blog/collapsible-shipping-containe...

That would handle the trade imbalance by allowing more empties to fit on the way back.

Or the USA could actually make something worth shipping. But that’s probably a lot harder than replacing a worldwide fleet of existing non-collapsible containers.

Re: Flexport CEO on how to fix the US supply chain crisis

#66

Earlier quoted context omitted.

> Theres an AFB outside of LA with proper rail siding. He identified it & facilities in thread. It exists. It has a rail siding. Can it handle the throughput that we're talking about? Air force bases have rail service, but they don't have the infrastructure for high-volume rail traffic. > Railroad are a regulated monopoly. Railroads are regulated, but are not a monopoly. (Though a railroad may have a monopoly on rail…

Railroads are literally a textbook example of a natural monopoly. In fact they're typically somewhere near the top of the list in any textbook.

For any particular industrial customer? OK. For a medium-sized town? Maybe. For hauling containers from LA to Dallas, or even from LA to an air force base 100 miles away. in a world where interstate highways exist? No.

Re: Flexport CEO on how to fix the US supply chain crisis

#67

I still don't understand the actual root cause after reading that thread. Is it too many full or empty containers? If full is the root cause a lack of truckers? If empty then why aren't boats picking up the empty containers when they leave?

There are no empties in the ports because all the spots to put containers are filled with full ones. In order to get empties back into the ports and onto ships you need to do three things.

1. Get full containers out of ports to make room for empties

2. Bring empties back to port and queue them up

3. Unload a bunch of fulls and reload a bunch of empties onto every ship that comes into port

Right now there's no room to store empties do they're being stored on trailers. Which means there are no trailers to unload full containers onto. So nothing is being unloaded. Deadlock.

Re: Flexport CEO on how to fix the US supply chain crisis

#68

Why isn't the solution to put empty containers back on unloaded ships to be sent away? BTW for fun reading on operations logistics and identifying and attacking bottlenecks see "The Goal" by Eli Goldratt. https://en.wikipedia.org/wiki/The_Goal_%28novel%29

Can cargo ships with empty containers actually sail back? In the past we shipped tons of alfalfa to China, partially because meat (and thus cow feed) is worth more in China, but I was under the impression that the main purpose was ballast for the ships because they can't sail without enough weight in them and alfalfa was the cheapest bulk weight they could source.

I know little about ship operations - but what is ballasting them when they’re sailing away now without empty containers?

Re: Flexport CEO on how to fix the US supply chain crisis

#69
post #63
post #60

Related: The mayor of Long Beach has increased the stacking limit. https://mobile.twitter.com/RobertGarcia/status/1451679404757...

It's weird to me that thousands of people work at the docks or with the trucks, and likely understand these problems quite well, but only after a silicon valley guy rented a boat to take a look and tweeted about it did it come to attention of the larger world. Is it just that these other people don't want to "rock the boat" at their place of employment?

It’s not clear to me whether the zoning regulation was changed in response to the Twitter thread.

Re: Flexport CEO on how to fix the US supply chain crisis

#70
post #62

Earlier quoted context omitted.

Because the empty needs to be either filled and put back on a ship going back to Asia, or put back empty. Either way, all the containers that go from Asia to the US need to go back. And it makes sense for the port that unloads to also load.

Doesn't seem like it makes sense in this case, though, does it?

Geographically there is no viable other port. And if there was one, you’d need trucks to get the containers there anyways.
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