Apparel Groups Voice Concern Over Stalemate

September 4, 2012

On the eve of the holiday preseason, the presidents of three major apparel and travel goods associations press both sides to return to the bargaining table.

Read the letter

September 4, 2012

Mr. James A. Capo
Chairman and Chief Executive Officer
United States Maritime Alliance, Ltd.
485C US Highway 1 South, Suite 100
Iselin, New Jersey 08830

Mr. Harold J. Daggett
President
International Longshoremen’s Association
5000 West Side Avenue, Suite 100
North Bergen, New Jersey 07047

Dear Mr. Capo and Mr. Daggett:

On behalf of the undersigned associations, we would like to express our concern with the situation developing in the East and Gulf Coast ports between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX). We at the American Apparel and Footwear Association (AAFA), the Travel Goods Association (TGA), Gemini Shippers Association, and the Fashion Accessories Shippers Association (FASA) urge both parties to swiftly return to negotiations to work out a suitable Master Contract for port employees and avoid work stoppages and slowdowns as we enter the busy holiday preseason.

The undersigned associations are very familiar with the pressing need for products to arrive on time at their destinations to prevent costly chargebacks from retailers while simultaneously fulfilling customer demand. This need for certainty and reliability becomes even more important during the months preceding the holiday season, when all levels of the supply chain increase production in anticipation of the busiest shopping period of the year.

With the recent breakdown in contract negotiations on August 22 and the current Master Contract’s end date of September 30, the prospect of a potential work slowdown and/or complete stoppage continues to trouble importers. The back-and-forth press releases between the two parties and the recent news that a vote to strike on the contract end date has already occurred in at least one major port have combined to make companies that import through the East and Gulf Coasts very nervous. Retailers and importers are already considering contingency plans that will take their products through more reliable ports, including those in Canada, or through entirely different transportation media altogether. Given the long-term planning necessary for oceanic transportation, many importers who are now booking cargo for East Coast bound ports would very likely become tangled in any potential work stoppage. As a result, many companies are already contemplating expensive alternatives that will incur multiplied transportation costs and divert business away from the East and Gulf Coast ports.

We urge you to enact a resolution of these negotiations immediately, as companies need to make shipping decisions now and cannot risk the possibility of shipments being held up at the Ports in the event an agreement is not reached by September 30. Though we completely understand the complicated dynamics of these negotiations, we believe the impact of a stoppage would cause severe and long-lasting effects for all parties involved as shipments are diverted and retailers and importers scramble for new reliable ways to get their products on the market in time to capture the peak of consumer spending during the holiday season. Lastly, in addition to causing extreme losses of port business and huge expenses for many levels of the supply chain, the need for unwanted cargo diversions and the existence of full-on work stoppages, if they were to occur, would have dire consequences for the already-struggling U.S. economy and the consumer population as a whole.

We thank you for your time and consideration to these concerns and look forward to a pragmatic resolution of these negotiations. If you have any questions or concerns please contact AAFA’s Transportation Liaison, David Lapidus, at 703-797-9049 or DLapidus@wewear.org or Nate Herman on behalf of TGA, FASA, and Gemini Shippers Association at NHerman@geminishippers.com.

Sincerely,
Kevin Burke
President and CEO
American Apparel & Footwear Association (AAFA)

Sara Mayes
President
Gemini Shippers Association
Fashion Accessories Shippers Association (FASA)

Michele Marini Pittenger
President
Travel Goods Association (TGA)