East & Gulf Coast Port Strikes and Disaster Relief Update

A massive labor strike that could cost the US economy $5 billion daily. Join us on Traction Control as we reveal the staggering impact of 45,000 dock workers walking out at 14 US East and Gulf Coast ports. Beginning at 12:01 am on October 1st, this disruption is shaking up the automotive aftermarket sector, potentially causing daily losses of nearly $340 million. We break down the labor dispute involving the United States Maritime Alliance and the International Longshoremen's Association, providing you with statements from both sides and insights into President Biden's decision not to invoke the Taft-Hartley Act. Tune in to hear how industry experts are navigating the rerouting of automotive parts imports and exports, compounded fees, and what businesses can do to weather the storm. 

Discover the advocacy efforts of the Auto Care Association and learn how you can contribute your own port strike impact stories to strengthen our collective voice. 

To learn more about the Auto Care Association visit autocare.org.

To learn more about our show and suggest future topics and guests, visit autocare.org/podcast

Transcript

Stacey Miller 0:13

Welcome to Auto Care On Air , a candid podcast for a curious industry . I'm Stacey Miller , ice President of Communications at the Auto Care Association , and this is Traction Control , where we chat about recent news from the global to the local level and what it may mean to the industry , featuring guests on the front lines . Let's roll , welcome back to another episode of Traction Control . And unfortunately , as of today , a strike of 45,000 dock workers has officially begun at 14 US East and Gulf Coast ports , starting at 12.01 am Eastern Time today , tuesday October 1st . The strike is expected to cause significant disruptions to the supply chain , with estimates suggesting that for every day the strike continues , it will take five to seven days to recover from the associated delays . A JP Morgan analysis predicted that a strike could cost the US economy $5 billion daily . Now , despite last-minute efforts , the United States Maritime Alliance , or USMX , and the International Longshoremen's Association , the ILA , were unable to reach an agreement over the weekend . Usmx officials met last Friday with Transportation Secretary Pete Buttigieg , acting Labor Secretary Julie Hsu and top White House economic advisor Lael Brainard in hopes of brokering a deal . The ILA was invited but declined to participate . In recent statements posted on the ILA's official Facebook page , the union voiced concerns over the threat of automation and criticized Ocean Carrier's mega-billion-dollar profits , while ILA longshore wages have reportedly remained stagnant . The USMX has also issued statements that the ILA has repeatedly refused to come to the bargaining table . According to the USMX , this is the first walkout by dockworkers on the East Coast since 1977 . Now President Biden has stated that he does not plan to invoke the Taft-Hartley Act and encourages the parties to engage in negotiations . The Taft-Hartley Act , which was previously used by President Bush in 2002 during the West Coast port strike , would grant the president authority to intervene in labor disputes that threaten national security , forcing both parties to return to the negotiating table and requiring longshoremen to return to work . The Auto Care Association continues to work with industry groups representing industries across the US to urge President Biden to work with both sides of the ongoing labor negotiations . We did send a letter and you can see that on our website at autocareorg .

Stacey Miller 2:55

Us automotive parts exports and imports represent $51.2 billion and $138.9 billion respectively , and that's from our AutoCare 2025 fact book . And with the looming threat of multiple ports closing along the United States coastlines , us automotive aftermarket businesses could risk losing up to nearly $340 million each day . The strike prevents imports from being delivered . Now , in 2023 , nearly 25% of automotive parts were imported through the East and Gulf Coast ports that are at risk of disruption from this labor strike , so members currently have already reported imports being diverted to West Coast ports , which are seeing a huge surge in imports and will also be impacted by the labor strike . This is compared to nearly 40% of imports that are imported via truck and rail freight through land port of entry from Mexico , and the source of that is the US International Trade Commission .

Stacey Miller 3:56

Now a key concern for importers is the compounding fees associated with container pickup , demurrage charges and container returns , which are known as detention charges , that may be assessed during the port strike and during the subsequent recovery period . The Federal Maritime Commission , or FMC , issued a final rule intended to add clarity to invoicing requirements outlined in the Ocean Shipping Reform Act of 2022 , which reaffirmed that demurrage and detention charges be reasonable and applied in a way that serves their intended primary purposes as financial incentives to promote freight fluidity . Members that believe their charges are not in compliance with the Shipping Act are encouraged to file complaints with the FMC , and you can find a link to that on our website at autocareorg . Now , as the East and Gulf Coast ports handle a significant portion of our industry's imports and exports , and a prolonged strike would strain the supply chain , lead to billions of dollars in losses , as well as delays in the movement of goods , making it difficult for repair shops and distributors to meet demand . In addition to the disruption at East and Gulf Coast ports , west Coast ports are also experiencing a surge in cargo , which could slow down the movement of goods in that region as well . But we need to hear from you on these issues , so please share your port strike impact stories to help support our advocacy efforts . You can also find the link to that on our website at autocareorg .

Stacey Miller 5:24

Switching gears to . Another story that's disrupting our supply chain and unfortunately causing issues all across the southeastern United States is the aftermath of the recent hurricane , and we've unfortunately learned that many automotive aftermarket industry team members have been deeply affected . The Automotive Aftermarket Charitable Foundation , or AACF , is here to offer support during these challenging times and , understanding the unique obstacles of a natural disaster , especially one of these unprecedented proportions , the AACF has streamlined the application process to get aid to those in need more efficiently . So if you or someone you know in the industry has been impacted , please , please , please complete the natural disaster relief application on the AACF's website , that's aftermarketcharityorg , and the AACF is also accepting donations to directly support those affected by the storm .

Stacey Miller 6:21

Every contribution helps provide vital assistance . So to donate , every contribution helps provide vital assistance . So to donate again . Please do visit their website at aftermarketcharityorg . Us a rating and review that helps others discover our content . Autocare OnAir is a production of the AutoCare Association dedicated to advancing the auto care industry and supporting professionals like you . To learn more about the association and its initiatives , visit autocareorg .