Baltimore Port Shut Down as Longshoremen Strike on Contract Feud

Oct. 17 (Bloomberg) — Baltimore’s port ceased operations as 2,000 union longshoremen walked off the job in a contract dispute, snarling imported cargo that included autos from Mazda Motor Corp. and Bayerische Motoren Werke AG.

“If an agreement can be reached within the next day or two, we don’t think there will be a huge economic impact,” Richard Scher, a spokesman for the Maryland Port Administration, said in an interview. “If it continues a week or two weeks, then you’re looking at some significant economic impacts.”

The closure puts pressure on the supply chain as Baltimore lures auto contracts away from east coast ports in New York and New Jersey. Mazda signed a five-year contract in August that will bring as many as 65,000 vehicles a year to the port from Japan, while Fiat SpA plans to ship 30,000 autos there.

The Port of Baltimore is the 12th largest in the U.S. by container volume, and one of the top ten employment centers in the state, according to the Maryland Port Administration’s most recent annual report.

The dispute centers on a contract signed by the International Longshoremen’s Association, covering ports from Maine to Texas, which needs to be ratified by all local labor unions. Local 333, one of four Baltimore chapters, rejected the contract and announced a work stoppage on Oct. 15.

New Contract

Local 333 is protesting the Steamship Trade Association of Baltimore Inc.’s refusal to negotiate “in good faith” over a new contract covering workers terms and conditions, the union said in a statement yesterday.

“Local 333 is eager to enter into a new contract with the STA,” its president, Riker McKenzie, said in the statement. “But the dedicated men and women working at the Port of Baltimore deserve a fair and just contract. We cannot accept STA’s refusal to negotiate over matters that the law requires them to negotiate.”

A representative for the Steamship Trade Association declined to comment.

Chrysler Group LLC, which is majority owned by Fiat, is “closely monitoring the situation and hopes for a speedy resolution,” Katie Hepler, a spokeswoman, said in an e-mail.

The automaker, based in Auburn Hills, Michigan, shipped about 124,000 vehicles using the port in 2012, Hepler said. This year it started receiving shipments of the Fiat 500L, a roomier version of its compact 500, through Baltimore, Hepler said.

“Like everyone else who uses the Port of Baltimore we’re hoping the strike is short and that business as usual returns as soon as possible,” Ken Sparks, a spokesman for BMW North America, said in an e-mail. “Baltimore is one of our three ports on the East Coast and of course we always have contingency plans should any location not be available for a period of time.”

Daimler AG’s Mercedes-Benz said about one third of its sales were processed through Baltimore, Donna Boland, a spokeswoman, said in an e-mail.

“It’s our hope that the situation will be resolved in the next few days.”

– Caroline Chen, Copyright 2013 Bloomberg.