Port of Long Beach aerial view

Merging the Ports of LA and Long Beach Gets a Thumbs-Down from Long Beach

April 11, 2014
The Los Angeles 2020 Commission recommends that the Port of Los Angeles and Port of Long Beach merge to become a single entity, if they hope to stop losing market share.

The Los Angeles 2020 Commission, an independent, private commission created in 2013 to study and report on fiscal stability and job growth in Los Angeles, has succeeded in at least one of its goals already: It’s gotten people talking. In its recent report, “A Time for Action,” the Commission recommends that the two biggest U.S. seaports—Port of Los Angeles and Port of Long Beach—merge to become a single entity. However, the LA 2020 Commission apparently did not ask anybody at the Port of Long Beach what they thought of the idea.

The Commission is made up of Los Angeles-area leaders from labor, business, government, academia and non-profits . In the report, the Commission points out that the combined market share of the two ports over the past decade has dropped by more than 5%. However, “it isn’t just about losing five points of market share,” the report stresses, “it’s about tax revenues and jobs,” which could represent as much as $100 million in revenues and 60,000 jobs. The Commission cites the Port Authority of New York and New Jersey, which was “formed by two states who don’t agree on much, but who understand the value of cooperating for a brighter shared future,” as an example of a merger of two neighboring and competing ports.

The Commission’s recommendation is that the Ports of Los Angeles and Long Beach enter into a Joint Powers Agreement “to manage future strategy and direction as well as capital planning and rate-setting.” This would be a true 50-50 collaboration, the Commission emphasizes, governed equally by the cities of Los Angeles and Long Beach. It would also help the ports combat the looming threat of competition from the Panama Canal expansion.

However, according to the Los Angeles Times, while the Port of Los Angeles is at least willing to discuss collaborative efforts, the reaction was quite a bit different from the Port of Long Beach. “This is a bad idea,” Doug Drummon, president of the Long Beach Board of Harbor Commissioners, told the LA Times. “The Port of Long Beach is not interested in a merger with our neighbor. Long Beach Mayor Bob Foster didn’t have much good to say about the Commission’s report, either, noting that nobody from the Commission sought input from Long Beach.

So far, major users of the ports, including cargo lines and big-box retailers, have remained mum on what they think of the proposal.

Latest from Global Supply Chain

25560070 © Yuliia Brykova | Dreamstime.com
Supply Chain Stability Improving
#64128824@Igor Groshev|Dreamstime
Preparing for Longer Conflict in the Red Sea: