MATSON INTRODUCES TERMINAL HANDLING CHARGE IN HAWAII TRADE

MATSON INTRODUCES TERMINAL HANDLING CHARGE IN HAWAII TRADE    Matson Navigation Co. will introduce a terminal handling charge for its U.S. Pacific Coast/Hawaii service, effective Jan. 12, 2003.
   Breaking with previous practice, the domestic carrier said that it would add a THC charge, but would not raise a general rate increase in 2003.
   Terminal handling charges are common in international container trades.
   The charge will become part of Matson’s permanent rate structure and is designed to recover a portion of the costs associated with the movement of cargo through terminal facilities on the West Coast and in Hawaii, the carrier said. The initial charge will be $200 per container for westbound freight and $100 per container for eastbound freight.
      “Terminal handling costs comprise approximately 40 percent of Matson’s operating costs and today exceed $200 million annually,” said James Andrasick, president and chief executive officer. There is a large cost component of these operations that Matson “cannot control,” he added.
   In the past four years, Matson’s terminal handling costs have risen over 23 percent. This does not include any cost increases that may result from new labor contracts currently being negotiated on the West Coast and in Hawaii.
   Matson said that the terminal handling charge would allow the company to recover only a small portion of the dollar amount of moving cargo through West Coast and Hawaii terminal facilities, and will be adjusted periodically as conditions dictate.
   Traditionally, Matson has implemented modest, incremental rate increases on an annual basis.
   The carrier said that it will continue to look for ways to make its terminal operations more efficient. In Hawaii, it has invested $36 million in a terminal improvement project. On the West Coast, it will consolidate its terminal operations and modernize its facilities.
   Matson said that the new terminal handling charge is “relatively modest” in comparison with fees in place throughout the world.