Relocating Backlogged Goods to Alleviate Logistics Bottlenecks
Increasing Activities During Off-Peak Hours
[Asia Economy New York=Correspondent Baek Jong-min, Reporter Kim Heung-soon] The Biden administration in the United States has requested cooperation from the private sector, including Samsung Electronics, to alleviate the logistics crisis at West Coast ports ahead of the year-end shopping season. The government judged that it would be difficult to resolve the logistics bottleneck caused by COVID-19 solely at the government level, and intends to solve the problem by enlisting the help of global private companies such as Samsung Electronics, which has significant influence in the North American home appliance market.
According to the White House on the 13th (local time), President Biden met with logistics companies, port leadership, truck unions, and chamber of commerce officials to seek ways to resolve the recent logistics bottleneck. The meeting included U.S. logistics and distribution companies such as Walmart, FedEx, UPS, as well as Samsung Electronics.
The White House announced through this meeting that the Port of Los Angeles (LA) on the West Coast will operate on a 24-hour schedule. Following the Port of Long Beach, which partially began 24-hour operations three weeks ago after the logistics crisis occurred, the Port of LA will also enter the same emergency operation system.
As part of this measure, major distribution and transportation companies such as Walmart, FedEx, and UPS have agreed to extend their operating hours to speed up the transportation of goods across the United States. Samsung Electronics, along with large retail stores Home Depot and Target, will expand their activities during off-peak logistics hours, the White House explained. President Biden specifically mentioned the actions of Samsung Electronics, Home Depot, and Target, calling it a significant advancement.
Analysts interpret President Biden’s actions on this day as driven by a sense of urgency that failing to resolve the logistics crisis ahead of the year-end shopping season could severely impact his already declining approval ratings. The year-end, which includes Thanksgiving and Christmas, is considered the biggest shopping season in the U.S. However, due to the aftermath of COVID-19, a shortage of dockworkers has delayed container supply, putting the ports’ logistics on high alert.
Samsung Electronics is also expected to play a certain role in resolving the logistics bottleneck in response to the Biden administration’s cooperation request. It is known that they are considering measures such as setting up temporary storage facilities near the ports to move backed-up goods like home appliances and ease container supply constraints.
A representative from Samsung Electronics North America stated, "Since the U.S. government has allowed ports with severe congestion to operate 24 hours, there was a discussion that companies should actively respond and contribute to resolving the logistics difficulties."
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