Port Operations + Automation

Port operations rarely make national headlines, but they do when president-elect Donald Trump (pro-union) and the world’s richest man Elon Musk (pro-automation) tweet about them, with opposing viewpoints on automation for shipping container loading/unloading.

Like airfare, container shipping comes with extra costs. Among those extra costs is a Terminal Handling Charge (THC) intended to recoup port costs around loading/unloading shipping containers.

According to leading container line A.P. Moller - Maersk's public fee schedule, U.S. THCs are:

• more than 2x higher than in Europe

• 5x higher than in Mexico

• up to 7x higher than in Asia

In the case of neighboring Mexico, the THC cost gap pushes international shippers to unload in Mexican ports and then truck cargo into the U.S.—a clear indicator that U.S. ports are losing on cost competitiveness.

High port costs also undermine domestic coastal shipping. If you’re paying $1,200 just to get in and out of a port, a trucker charging $2 per mile gets a 600-mile head start before marine freight even factors in.

If U.S. ports don’t improve their competitiveness, the international market will find ways to work around them and a promising domestic market will fail to develop.

Automation presents one of the clearest paths to improve port efficiency and costs, but the ILA is threatening to strike in January, shutting down the U.S. East & Gulf Coast ports—unless they get a complete ban on automation.