Ports of Seattle, Tacoma hope Northwest Seaport Alliance will help regain cargo market share

Commissioners of the Pacific Northwest ports approved a plan to unify their marine cargo terminal investments, operations, planning and marketing in an attempt to strengthen the Puget Sound gateway and attract more marine cargo to the region.    The Port of Tacoma and Port of Seattle on Tuesday formally launched The Northwest Seaport Alliance, which will unify the two ports’ marine cargo terminal investments, operations, planning and marketing.
   The two ports hope to strengthen the Puget Sound gateway and attract more marine cargo to the region.
   Combined, the two ports handled 3,456,161 TEUs in 2014, making them the fourth largest container gateway after ports of Los Angeles, Long Beach, and New York/New Jersey. Volumes have hovered around 3.5 million since 2010. A decade ago, in 2005, they reported a combined throughtput of 4,154,376 TEUs.
   The alliance is “truly historic and signals a new era of cooperation between our ports,” said Port of Seattle Commission co-President Courtney Gregoire. “Combining our strong cargo terminal operations will make our region more competitive in the global economy and create new jobs in Washington.”
   “We have moved from fierce competitors to bold collaborators to form a new business model for the greater good of our region,” said Don Johnson, Port of Tacoma commission president. “We recognize how critical the maritime industry is to our state’s economy, and we are proud and excited to strengthen it even more.”
   The Federal Maritime Commission, voted unanimously July 23 to approve the agreement, and the two ports finalized the unification during a joint meeting on Tuesday.
   While the ports remain separate organizations that retain ownership of their respective assets, they formed a port development authority (PDA) to manage the container, breakbulk, auto and some bulk terminals in Seattle and Tacoma. The PDA will be governed jointly by the two ports through their elected commissions.
   The airport; cruise business; marinas, such as Fisherman’s Terminal; grain terminals and industrial real estate, such as the Northwest Innovation Works and Puget Sound Energy facilities and Terminal 91 uplands, will remain outside the alliance.
   Among the votes taken Tuesday to formally launch the alliance, the commissioners hired John Wolfe, current Port of Tacoma chief executive officer, as the CEO of The Northwest Seaport Alliance. Wolfe will lead both organizations through a transition period of up to five years.
   Tara Mattina, a spokesperson for the Port of Tacoma, said there is no reduction in workforce expected as a result of the combination, noting that the ports have been running with a lean staff and now hope to increase business.
   “This is a historic day that gives new hope to the tens of thousands of men and women whose livelihoods depend on a strong Pacific Northwest maritime industry,” said Capt. Mike Moore, vice president of the Pacific Merchant Shipping Association. “Working as a team, the ports of Seattle and Tacoma will be stronger and much better positioned to make the smart investments that are necessary to keep the ports competitive.”
   Moore noted that the ports, which face stiff competition from other regional gateways like Vancouver and Prince Rupert in British Columbia, have been losing market share and that the alliance will allow them to prioritize projects to attract additional cargo. In addition, many shippers have permanently diverted cargo to East Coast U.S. ports after contentious labor contract negotiations between the International Longshore and Warehouse Union and its employers caused significant congestion and cargo delays at West Coast ports throughout the latter part of 2014 and early 2015.
   Moore, as well as the ports, praised a transportation investment package that was approved by the State of Washington’s legislature and governor.
   The ports say the $16.2 billion package will benefit the state’s economy by speeding the movement of cargo through the ports and freight corridors. It includes funding to complete the key freight routes of State Route 509 in King County and State Route 167 in Pierce County.