Already, everything smells of the holidays, the air carries the story, and families prepare for the festivities. However, for the U.S. supply chain, the story is quite different, and the atmosphere screams “unprepared”. The holiday shopping has begun, but there are barely stocks in warehouses. Along the port of Los Angeles lie cargo backlogs waiting to be transported to consumers across the country.
Problems of the U.S. Supply Chain
The auto transport industry feels the loophole greatly, with car dealers barely able to meet customers’ demands. It all began with the global COVID-19 pandemic. Businesses shut down, people stayed at home, and there was no need to buy vehicles or stock them in warehouses. When the economy reopened, there was a hike in demand for automobiles. This caused huge problems in the U.S. automobile supply chain. First was the semi-conductor chip shortage, an issue the auto industry faced due to the inability of companies to produce raw materials needed for manufacturing cars after the pandemic.
As cargo ships from Asia strived to meet the post-pandemic demands, other problems in the supply chain began to surface. The coastline ports became heavily congested, and truck drivers became more scarce. This left most warehouses empty, with hundreds of companies unable to meet the demand of customers increasing shopping for the holidays.
Effects of the Supply Chain Disruptions
The myriad problems have created a bottleneck in the automobile transport sector that left one part of the U.S. supply chain blaming the other. Shipping companies at the ports blame the unavailability of cargo space. In contrast, warehouse owners blame the insufficiency and inefficiency of truck drivers.
While all of these are ongoing, prices are skyrocketing at each transmission point. Warehouses are experiencing an almost 100% increase in transportation costs. Sadly, this has not in any way helped to improve delays as vehicles take days or months to reach warehouses. To worsen it all, warehouse holders pay extra fees to store their cargoes safely at transmission points till they can be moved. With more to pay to bring automobiles to customers’ doorsteps, warehouses have no choice but to increase prices.
Solutions Proposed to Ease the Port Congestion
There are economic projections on how holiday sales this year might experience an 8.5% to 10.5% increase over that of last year’s. Of course, early holiday shopping orders have already begun. Every segment of the U.S. supply chain is clamoring for a solution if all of these orders must be satisfactorily met. In the automobile industry, the problem has shifted from insufficient cargo at ports to lack of cargo space and truck drivers to transport the cargoes.
On the 13th of October, President Joe Biden announced that the Ports of Los Angeles and Long Beach would work round the clock. Hopefully, this would double the rate at which cargoes leave the ports, creating more space for ships lying in wait ashore. On the other hand, there have been structures put in place to ensure truck drivers are available. After all, without them, cargoes cannot leave the ports. Bob Costello, chief economist of the American trucking association, revealed increased welfare for truck drivers, with their salaries rising by five times the average rate in the past two and half years.
In a new update, the ports of Los Angeles and Long Beach have decided shipping companies may pay a $100 fee for containers they do not unload after eight days. For every day extra spent in the port after that, the fee increases by $100.
Our Role at Metti International
Apparently, so much needs to be done in so little time. At Metti International, all hands are on deck to implement every solution that improves the U.S. supply chain. As always, we take proactive methods to mitigate the port congestion challenges and provide the best auto shipping services to our customers. Understanding that everyone has a role to play, we recommend customers ship their vehicles from major metro areas. Pick-up and drop-off are easier and faster at these areas than at remote locations.
Metti International has excellent records: BBB accredited with A-plus rating, three-time award-winner of the BBB Torch Award for Ethics. We are a licensed car shipping broker with the Federal Motor Carrier Safety Administration. We offer a safe, timely, and smooth transport experience at competitive pricing. Metti International is the top choice for your vehicle shipping needs.