November 12, 2013
The Los Angeles Board of Harbor Commissioners last
week approved a new incentive program aimed at rewarding ocean shippers
that bring new container business to the Port of Los Angeles in 2014.
Under
the program, an ocean carrier will earn $5 per 20-foot equivalent unit
(TEU) for each incremental container it ships through the port in
calendar year 2014. The rate increases to $15 per TEU if their container
volume grows by 100,000 or more units next year.
The baseline
for measuring increased volume will be the total number of containers
moved through the port in calendar year 2013. Carriers will receive
their incentive as a lump-sum payment in early 2015. Staff will evaluate
the program's effectiveness monthly and determine whether to recommend
an extension beyond 2014, port officials said in a press release.
The
incentive program helps address how shipping fundamentals are changing
and international carriers are rethinking traditional business
practices, especially with a trend toward larger vessels and increased
global shipping capacity, they said.
"Carriers are rethinking
their routes and relationships to be as competitive as possible, [and]
this incentive gives them another reason to strengthen their ties with
the Port of Los Angeles," said Geraldine Knatz, the port's executive
director.
Purpose
