RO/RO TRANSPORTATION 2008 - Despite current uncertainties, Ports America remains bullish on ro/ro

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Imports remain stagnant but exports are upBy Peter A. Buxbaum, AJOTPorts America Group had a crown jewel within its grasp late last year when it announced it had agreed with the Bayonne Local Redevelopment Authority in New Jersey for the purchase of the 153-acre maritime site formerly known as the Military Ocean Terminal, Bayonne. But the $90 million deal is on hold for now because the Port Authority of New York and New Jersey claims it cut a prior deal with the locals to purchase the same facility.
“We intend to use the site for ro/ro operations,” said Frank Fogarty, Ports America’s senior vice president for ro/ro cargo. “Right now the matter is in litigation. We hope to prevail and to develop and operate that site as a ro/ro facility.”
MOTB was abandoned by the Army in 1999 as part of the US Department of Defense’s base consolidation program. The acreage reverted to the City of Bayonne.
Ports America still has a presence among the ro/ro New York-New Jersey harbor without MOTB, but without its own facility. The company performs stevedoring operations at the Northeast Auto Terminal in Jersey City and performs terminal management services for FAPS, Inc., in Port Newark, a facility that handles automobiles and heavy equipment.
“There is not much available property left in the New York and New Jersey area,” Fogarty commented. “As ro/ro volumes grow over time we simply have to have more space and capacity available in order to handle the business and service our customers. Otherwise we will have to look for additional capacity in other ports. It would be a big benefit to the industry to allow us handle more volume in New Jersey.”
The Ports America group of companies is currently owned and managed under the AIG Global Investment Group, a subsidiary of American International Group, Inc. (AIG). That investment group consolidated holdings acquired from P&O Ports, other terminal operators, and vehicle processors to form the largest terminal operator, stevedore, and vehicle processor in the Americas. The company boasts operations in 50 ports and 97 terminals in the United States, Mexico and Chile and handles annually over 12 million TEU, two million vehicles, and five million tons of general cargo at auto, container, bulk, and break-bulk facilities.
On the ro/ro front, Ports America conducts operations at over two dozen ports on all three coasts including Boston; Davisville, RI; Newark; Wilmington, DE; Baltimore; Norfolk; Newport News; Wilmington, NC; Sunny Point, SC; Charleston; Savannah; Brunswick; Jacksonville; Port Canaveral; Miami; Tampa; New Orleans; Houston; Galveston; Beaumont; Corpus Christi; Venetia, Richmond, Port Hueneme, Los Angeles, Long Beach, and Concord, CA; Portland, Oregon; and Tacoma and Vancouver, Washington.
“Our strategy is to remain diversified,” said Fogarty. This applies to the variety of cargoes handled by Ports America as well as in the gamut of ro/ro cargo it deals with.
“We serve a variety of ro/ro customers,” said Fogarty. “We feel that we can position ourselves to continue to serve this market by driving capacity in the form of terminals and investing in capital and proper equipment such as specialized trailers and heavy duty tractors. We also put a lot of effort into sophisticated training to achieve the best productivity with the least amount of damage in handling cargoes. Safety is a core company value.”
Ports America considers automobile imports to be its main ro/ro business, although, with the economic downturn in the United States coupled with high gasoline prices and a weak dollar, imports have remained static in recent times while exports have increased. “Our key customers are auto importers,” said Fogarty. “We also handle also exports to Asia and Europe. Import volumes have remained static and we expect that to continue under the current uncertain economic conditions in the US The high price of gas at the pump appears to be slowing down the import trade in autos while it looks like exports by US auto manufacturers are pickin

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Peter Buxbaum has been writing about international trade and transportation, as well as security, defense, technology, and foreign policy, for over 20 years. Besides contributing to the AJOT, Buxbaum's work has appeared in such leading publications as [em]Fortune, Forbes, Chief Executive, Computerworld, and Jane's Defence Weekly[/em]. He was educated at Columbia University.