Alaska dodges freight bullet during longshoremen lockout

Mat-Su -- Alaskan freight handlers, product distributors and retailers had their eyes on the lock-out of West Coast longshoremen last week but good news came on Friday, and it seemed that the Alaskan economy had dodged a dangerous -- albeit slow-motion -- bullet. Still, the situation had Alaskan freight companies preparing to implement contingency plans -- plans which they said have been in the works since May when contract negotiations between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) began.

Bill Meszaros, vice president of Alaska operations for Pacific Alaska Forwarders said his company has been arranging contingency plans for customers that include trucking, air freight and tug and barge service from the west coast.

"We have to [plan in advance] because otherwise our freight would be stacking up at Fife [Washington]," Meszaros said.

Relief came when CSX and Totem Ocean Trailer Express (TOTE) each signed agreements with the ILWU. The agreements amount to exemptions for loading Alaska-bound vessels at Washington state ports. CSX and TOTE are the only shipping companies that serve Alaska ports with container ships. There are about half a dozen other shippers that use tug-and-barge to bring goods to Alaska, which is slower and not affected by PMA's lock-out of ILWU workers. Container ships take about four days to make the trip that takes a barge eight to 10 days, depending on stops along the inside passage or the number and weight of barges, according to Meszaros.

"Two-thirds of goods sold in Alaska are delivered on container ships," Bob King, a spokesman for Governor Tony Knowles said. "The impacts of a prolonged lock-out would have been significant." But King and officials at the Port of Anchorage both said no one really knows how long it would take before Alaskans saw shortages of basic goods such as groceries or inflated prices on any goods.

CSX and TOTE each had vessels underway to Alaska from ports in Washington state on Friday. CSX ships normally arrive at Port of Anchorage on Tuesdays and Sundays, while TOTE ships normally arrive on Tuesday, Saturday and Sunday. Both companies should have a ship arriving Tuesday.

"The ships are on-line so you really shouldn't notice a thing ," Meszaros said. "As long as that continues [consumers] shouldn't notice a hiccup at all."

The next potential hiccup -- and the one national media outlets have focused on -- is the effect of having an import cargo bottled up off-shore instead of coming into the United States and entering the wholesale and retail markets. Much of the product off the west coast is ordered in anticipation of the Christmas shopping season. Again, the Alaskan economy seems to have dodged a bullet, but this time for different reasons.

Donny Dean owner of Powersounds on Seward Meridian Road said he would likely be able to satisfy customers for two months, despite the fact that much of what he sells is manufactured overseas. That's because Powersounds stocks up for sales that coincide with permanent fund dividends, which the state will start issuing Oct. 9.

"We've got probably a 30- to 60-day supply because we bought all of our stuff early for dividends," Dean said. "If you come in my store right now, there's a $35,000 pile of Pioneer [car audio] decks. If we didn't order them six weeks in advance we wouldn't have them here." Dean said customers will find similar situations at big box stores.

In a typical month, Powersounds goes through about $60,000 in home theater and car audio inventory, according to Dean, but October sales are expected to be more than double that or better. Dean referred to the dividend effect as "two Christmases" and his strategy is basically to operate like a warehouse store beginning in September of each year, when customers start increasing their spending. There is on-site storage at Powersounds -- storage that would be mostly empty if not for the dividend check sales spike.

"The whole upstairs of our building is full of product," Dean said. "Alaskans are lucky because we started buying ahead of time last month."