The port strike could boost UPS, FedEx, and other air shippers
As a massive dockworker strike leaves billions of dollars worth of cargo stranded near U.S. ports, companies that transport cargo by air could stand to benefit. The supply chain logistics platform Flexport is telling their by-sea clients to consider the skies instead.
“On the brink of the peak holiday season rush, businesses may begin to ship via air instead of ocean,” it said in a blog post monitoring the strike. “Air freight prices will likely surge, while capacity will continue to tighten in an already-strained market.”
Barron’s reports that companies such as UPS (UPS) and FedEx (FDX), which are major players in the air freight industry, will likely see an uptick in business as companies try to figure out ways to get their goods into the country.
More than 45,000 members of the International Longshoremen’s Association (ILA) union have shut down operations at ports from Maine to Texas, ceasing about half of U.S. import activity. The members are seeking higher pay and better working conditions.
“We are prepared to fight as long as necessary, to stay out on strike for whatever period of time it takes, to get the wages and protections against automation our ILA members deserve,” ILA President Harold Daggett said in a statement Tuesday morning.
Negotiations with the United States Maritime Alliance (USMX), a trade group of ports and shipping companies, didn’t come to a resolution Monday evening, which triggered the work stoppage.
— William Gavin contributed to this article.
