Speaker 1: Bloomberg Audio Studios, podcasts, radio news, and.
Speaker 2: Chris cross the Pacific from San Diego up to Vancouver.
Speaker 2: There's just so much that we don't cover being here
Speaker 2: on the far and distant shore. Geens Soroca owns the
Speaker 2: high ground here driving all of the Los Angeles Park technology.
Speaker 2: He's been doing it for twelve fourteen years. We're thrilled
Speaker 2: to We love when he comes in because he just
Speaker 2: gives us a flavor thumb up or thumb down. Right now,
Speaker 2: on Pacific transport, given a war thumbs up.
Speaker 1: We've seen a lot of fits and starts because of
Speaker 1: trade policy, the warner around. There are five conflicts happening
Speaker 1: in the Middle East right now. Yeah, the sewiz Canal
Speaker 1: effectively has been running at ten to twenty percent efficiency
Speaker 1: for four years. So cargo has really started to move
Speaker 1: into that southern California gateway over this time because it didn't.
Speaker 3: Have that many options.
Speaker 1: But you know, Tom, compared to COVID nineteen when we
Speaker 1: saw those ships backed up and the pilots of cargo,
Speaker 1: things are moving normal. We've moved more cargo during this
Speaker 1: time period than we did during the peak of the
Speaker 1: peak then, and not one ship is.
Speaker 2: The back onion members happy? Are they working triple overtime?
Speaker 4: Kind of bait.
Speaker 1: I see some of these guys at the Elks Club
Speaker 1: for happy Hour. They're getting a lot of hours on
Speaker 1: the job. They're working, they're throwing the cargo, they're hustling. Yeah,
Speaker 1: they're the best in the business.
Speaker 4: Like, Yeah, it's like overtimes.
Speaker 5: Making comparisons to what the market was like at the
Speaker 5: height of the pandemic and how improved, how much more
Speaker 5: efficient it's running. I mean, talk to us a little
Speaker 5: bit about those lessons you learn from the pandemic. Are
Speaker 5: they paying off?
Speaker 3: Yeah, Damien. Two things.
Speaker 1: Number One, we had to be humble, lean on each other,
Speaker 1: kind of open up the books a little bit and see.
Speaker 3: Where it went wrong.
Speaker 1: And it was probably a little bit of communication laps,
Speaker 1: folks doing things on their own. Nobody trying to do
Speaker 1: anything sinister, but everybody was out there just trying to
Speaker 1: edge ahead for themselves. Second, the advent of technology, whether
Speaker 1: it's the truck reservation system, being able to see cargo
Speaker 1: forty days before it lands on the shore of Los Angeles,
Speaker 1: all of that makes us smarter.
Speaker 3: Leaning on each other made us better.
Speaker 5: You know, Tom, This is amazing because you know, if
Speaker 5: you look at JP Morgan, a lot of these people
Speaker 5: and what they're talking about, what they got wrong here
Speaker 5: about the impact of inflation, of horror moves of Iran
Speaker 5: on inflation here in the US, is that the demand
Speaker 5: destruction is real, like the way that the consumer has
Speaker 5: adjusted their demand patterns in order to adjust to the supply.
Speaker 5: Shop talk to us about what else you're seeing from
Speaker 5: the perspective of the consumer. Are you seeing volumes still
Speaker 5: continuing to expand, Are they, you know, kind of getting
Speaker 5: a little constrained here?
Speaker 4: What are your thoughts?
Speaker 1: Yeah, Davian, the example is happening right now. We saw
Speaker 1: small to middle sized importers bringing in their cargo a
Speaker 1: little bit earlier than a traditional peak season. Two main reasons. One,
Speaker 1: the temporary tariffs were expiring on July twenty fourth. I
Speaker 1: know my price, I've got a window. I've got to
Speaker 1: speed the cargo to market. And then second, the fuel
Speaker 1: adjustment factors in the shipping industry lag by about three months,
Speaker 1: so they saw a day when that price was going
Speaker 1: to spike. Let me average my cost down, get as
Speaker 1: much product in as I can.
Speaker 4: I look at this Jane and wrapped around it is.
Speaker 2: I think it's eighty eight different cities in Los Angeles,
Speaker 2: and Los Angeles is like bigger than Rhode Island.
Speaker 3: That's right, in eighty eight cities in LA County.
Speaker 4: What's the state?
Speaker 2: You'res such a great voice for a La down trodden
Speaker 2: billionaires tax everybody's moving to Austin, Texas, or they're moving
Speaker 2: up to the Central Valley, et cetera, et cetera.
Speaker 4: What's the real story of LA right now that you see.
Speaker 1: One in fifteen working Angelinos have a job related to
Speaker 1: this port complex and supply chain.
Speaker 3: Wow, that's super powerful.
Speaker 1: We've got twenty million people that live in southern California,
Speaker 1: so when we do all these imports, we got a
Speaker 1: lot of mouths to feed. We've got a lot of consumers.
Speaker 1: We also have the largest manufacturing base of employment in
Speaker 1: the country, four hundred thousand jobs in La County.
Speaker 4: Dot knows.
Speaker 2: My father used to lecture me on this, like McDonald,
Speaker 2: douglass and the rest of the way back aerospace in all.
Speaker 3: It's aerospace defense four hundreds.
Speaker 2: And thousand Richfield, you know, I mean, you're not even
Speaker 2: old enough to remember Atlanta Richfield. But the bottom line
Speaker 2: is did you just say it's the largest manufacturing base.
Speaker 3: Of employment in the country La County.
Speaker 5: You know, I have to ask you this, Gina, and
Speaker 5: I'm sorry to shift gears, but you know, I haven't
Speaker 5: heard much about the rebuilts into the wildfires hit Malibu
Speaker 5: in La County. I mean, can you give us a
Speaker 5: little bit of insight as a local there? I mean,
Speaker 5: are we seeing people, you know, move back into the area.
Speaker 5: Are people building there again? Talk to us a little
Speaker 5: bit about that.
Speaker 1: The progress and the resolver two different things. Folks absolutely
Speaker 1: want to get back into Alta Dina to Pacific Palisades
Speaker 1: and even the edges of Malibu that were that were
Speaker 1: burned so badly. But one thing that's real are the
Speaker 1: international and tariff policies. Softwood lumber that comes out of Canada.
Speaker 1: Appliances that are made in the Makuiladora areas of Mexico
Speaker 1: steal with fifty percent tariffs. Furniture and footweark are up
Speaker 1: ten percent or more over last year. It's more expensive
Speaker 1: to rebuild, and then, of course, as you guys have reported,
Speaker 1: there's a gap between the insurance coverage and the rebuild cost,
Speaker 1: only exacerbated by teriffs.
Speaker 2: She's a rucker where there's from Los Angeles driving all
Speaker 2: over the port there. Love having them in with the
Speaker 2: flavor of southern California. You grew up in New Orleans.
Speaker 2: You're in school in New Orleans, which is humidity and heat.
Speaker 2: Now you're out in Southern California, which is I guess
Speaker 2: dry and heat, and it's getting a hotter. Discuss climate change.
Speaker 2: Is it affects your staff, the customers of your operation.
Speaker 2: It's getting hotter out in Phoenix over to La, isn't it? It?
Speaker 1: Sure is?
Speaker 3: Tom and feel it. I feel it.
Speaker 1: And the thing that we look at the most is
Speaker 1: in that harbor enclave at the Port of LA. We've
Speaker 1: got two hundred and sixty thousand residents in San Pedro, Wilmington,
Speaker 1: Harbor City, Harbor Gateway, and Watts. There are millions more
Speaker 1: that live along these key commerce corridors. We believe it's
Speaker 1: our job to bring that health risk down through reduction
Speaker 1: and pollution. We've reduced diesel particulate matter tailpipe pollution by
Speaker 1: ninety one percent since we started our clean Air Action
Speaker 1: plan in two thousand and six.
Speaker 2: Did Jay once again a month? I got to get
Speaker 2: this one question and Damien takeover. Gee, how do you
Speaker 2: respond to forty five tankers stuck in the Persian Gulf?
Speaker 1: Having lived and worked in the Middle East for five years, Tom,
Speaker 1: I'm keeping up with my business contacts and lifelong friends
Speaker 1: that I made during my time stationed in Dubai. This
Speaker 1: is really tough because it's the crew members that are
Speaker 1: on these vessels that have been stranded. Now we're in
Speaker 1: our six month of this war, and there are other
Speaker 1: conflicts happening throughout the region that have put an unbelievable
Speaker 1: amount of stress on these people that guide the ships
Speaker 1: and the supply chains they support. There's an adage in
Speaker 1: our industry. If your port gets shut down for a day,
Speaker 1: whether whatever the case may be, it takes about three
Speaker 1: days to catch up. We're now six months in this war,
Speaker 1: straight of horror, moves closed, open, really closed. It's going
Speaker 1: to take a long time not only to get these
Speaker 1: ships back into rotation, but to repair the damage that's
Speaker 1: been done through this war torn region and future proof it.
Speaker 5: You know, I'd love to ask him about why the
Speaker 5: Dodgers have just lost six in a row, whether or
Speaker 5: not you're worried about it. But Geen, what I really
Speaker 5: will ask you is about a Nino and how you
Speaker 5: expect the port to adapt, you know, to climate change.
Speaker 5: To rightly point out, I mean, Tom, I think he
Speaker 5: hit the nail on the head here. You know, there's
Speaker 5: going to be some interesting dynamics. What are you expecting
Speaker 5: through the second half of this yearfl Ninho really does
Speaker 5: continue and it starts to even you know, get stronger here.
Speaker 1: Well, this is not meant to be to the detriment
Speaker 1: of any other port.
Speaker 3: Ricardo Vasquez, who.
Speaker 1: My friend Katin, who runs the Panama Canal Authority, good friend,
Speaker 1: great businessman. He's now faced with some issues. Yeah, what
Speaker 1: we're doing is not taking his cargo. We're planning in
Speaker 1: the event he can't move as much product through his
Speaker 1: three locks in the canal. How do we prepare in
Speaker 1: Los Angeles to get ready? I see that just on
Speaker 1: the drawing board here probably a five percent up ticking
Speaker 1: cargo because some of it will move to avoid any
Speaker 1: type of concerns in the supply chain. And we're working
Speaker 1: with our Harbor Trucking Association Robert Loyer, our terminal operators,
Speaker 1: our rail partners, and longshore labor to make sure guys
Speaker 1: down the pipe. We see a little bit of an uptick.
Speaker 1: Let's get ready with our skilled labor, land and machinery
Speaker 1: to take that on. And if it doesn't happen, there's
Speaker 1: no shame in that. But we've got to have the
Speaker 1: preparedness based on these changes in supply chain patterns.
Speaker 4: We welcome all.
Speaker 2: Of you across America and of course early morning Pacific
Speaker 2: rim as well, from San Diego up to Vancouver farther
Speaker 2: north through good Morning Whistler, where I think it's almost
Speaker 2: sixty degrees. It is probably nicer the way you choose
Speaker 2: to listen to us. Thank you so much on Serious XM,
Speaker 2: and of course Good Morning ninety two NINEFM, Boston, ninety
Speaker 2: nine one FM, Nathan Hager Radio Washington in Bloomberg eleven
Speaker 2: three to zero Jobs Day and about I'm doing the
Speaker 2: math fifteen sixteen minutes with a great lineup. But this
Speaker 2: is just a joy on a summer Friday to talk
Speaker 2: to Gene Soroca about the pulse going north from the port.
Speaker 2: We have stereotypes here, but as you go up to
Speaker 2: San Francisco up to Portland, Oregon, all that Carnie and
Speaker 2: Canada is doing on their west coast. It's basically a
Speaker 2: booming How many miles I'm going to say one thousand miles?
Speaker 4: Am I guessing pretty close?
Speaker 1: It's booming right absolutely, and so are we. This Port
Speaker 1: of Los Angeles is in a period of time right now, Tom,
Speaker 1: where we've really lined up our commercial business. The relationships
Speaker 1: run deep across the supply chain, and the financial setting
Speaker 1: that we're in right now has never been better. We've
Speaker 1: got one hundred and sixty capital improvement projects on our dashtar.
Speaker 4: Give us an example of that. Give us a capital improvement.
Speaker 1: One of the reasons I'm in New York this week.
Speaker 1: We just signed an agreement with the Newsomb administration California
Speaker 1: Governor Gavin Newsom's administration build a new bridge that traverses
Speaker 1: from the residential areas in San Pedro to Terminal Island.
Speaker 1: I'm here seeing banks and financial institutions to work on
Speaker 1: a P three concept that's never been done before.
Speaker 3: We're really excited about this.
Speaker 1: We're also building a new cruise terminal that's being helped
Speaker 1: out by a number in the industry, including Carricks at SSA,
Speaker 1: and for the first time in a generation, we've got
Speaker 1: bids due in December for a brand new container change.
Speaker 1: The investment at the Port of la is off the time.
Speaker 4: I'm sorry. The bridge has got to be the truck
Speaker 4: Scooball Bridge. Oh my god, it's got to be.
Speaker 5: Well, you know, I just thought Gene was in town
Speaker 5: basically meeting with his colleagues at the Port of New
Speaker 5: York and New Jersey, you know, like going golfing and
Speaker 5: outside of port of limits.
Speaker 2: The state of the ports here from three thousand miles away, Yeah,
Speaker 2: it's quick to the state of the ports here.
Speaker 1: Beth Rooney runs the Port of New York and New Jersey.
Speaker 1: She is one of the best in the business. And
Speaker 1: these guys mean so much. You're within drive time of
Speaker 1: two thirds of the American population. With cargo coming in
Speaker 1: and out of this gateway. It is essential for the
Speaker 1: American economy.
Speaker 5: I mean, do you regularly interact obviously with the Port
Speaker 5: of New York, New Jersey, but Port of Savannah, you
Speaker 5: know all these I mean, do you guys kind of
Speaker 5: you know, like like you readily point out, you know,
Speaker 5: preparing for some you know, some sort of something happened
Speaker 5: with the Panama Canals. You guys kind of all work
Speaker 5: together to make sure that logistically speaking, you guys are
Speaker 5: on the same page.
Speaker 1: Yeah, and contrary to popular opinion, we all get along
Speaker 1: extremely well. The pockets of cargo, the people that we serve,
Speaker 1: and the jobs that we have to do every day
Speaker 1: are so important to this country and our local communities.
Speaker 1: It is a really good band of folks that we
Speaker 1: have working together at ports in the US today.
Speaker 4: He has never said anything negative.
Speaker 5: He has the gift.
Speaker 4: It's unbelievable. What's along shoreman make?
Speaker 1: Oh, it depends. These guys out on the West coast
Speaker 1: do really well. But this is one of the most dangerous.
Speaker 2: Shouldn't answer my question. They're popping big six figures right.
Speaker 1: Yeah, they make a good middle class wage. Now you've
Speaker 1: got registered lawn shortman about nine thousand.
Speaker 4: They make the middle class.
Speaker 2: Ways if this America was build on after World War Two,
Speaker 2: these are guys making a legit middle class.
Speaker 3: Wage on average north of two hundred thousand.
Speaker 2: It's why is it evaporated from America? Why have we
Speaker 2: lost the jobs that were middle class in Detroit, the
Speaker 2: jobs in New Jersey that were middle class, the ones
Speaker 2: you're living right now at the port.
Speaker 3: Again, we look at Detroit.
Speaker 1: We do about thirty billion dollars worth of business with
Speaker 1: the OEMs and Detroit and the tiered suppliers throughout the
Speaker 1: Ohio Valley. I've been impressed by what Michigan has done
Speaker 1: to modernize around the industry. You got four miles of
Speaker 1: electrical cable and cars. Now the price being at fifty
Speaker 1: thousand dollars for a new vehicle is problematic, and it
Speaker 1: is symptomatic of what we've talked about with respect to
Speaker 1: inflation and trade policies. But the state of Michigan is
Speaker 1: behind its automotive industry.
Speaker 5: I mean, I mean, I know, if you're going to
Speaker 5: lend me, I mean I'm happy to ask, please, Geane,
Speaker 5: what outside of you know, meeting with banks and finance
Speaker 5: and trying to get you know, funding for you know,
Speaker 5: you for with our hopefully great investments. Talk to us
Speaker 5: about you know, demand for those meetings, demand for infrastructure,
Speaker 5: demand for infrastructure investments. Are you seeing you know, people
Speaker 5: you know willing to put their hands in their pockets
Speaker 5: in this enbob environment with yields where they are to
Speaker 5: to to lend to you over the long term.
Speaker 1: I do, And this week in New York it's been
Speaker 1: super encouraging the way folks look at it is and
Speaker 1: for agencies like ours, we have to invest through budget cycles,
Speaker 1: economic cycles, and even election cycles.
Speaker 4: Now.
Speaker 3: To build this new bridge from Stem to Stern will
Speaker 3: be about seven to ten years.
Speaker 1: So we can't get to the point where we're wringing
Speaker 1: our hands today because things don't look exactly perfect. And
Speaker 1: that's what the big thinkers here in Manhattan we're telling
Speaker 1: me this week.
Speaker 2: The Turk Scooble Bridge. Do you know the Dodgers have
Speaker 2: lost six in a row and they're still playing well.
Speaker 5: They ran into a bus, they ran into the Red Sox, right,
Speaker 5: and then I think the Cubs just got them the.
Speaker 1: Cuts, right, Yeah, they got swept two series in a row,
Speaker 1: one at home, one on the road.
Speaker 4: Crisis.
Speaker 5: Yes, I'm kidding.
Speaker 3: It's one hundred and sixty two game season.
Speaker 1: You're gonna go through bumps, Okay, back to back World
Speaker 1: Series champs.
Speaker 3: I'm not gonna count them out.
Speaker 4: Okay.
Speaker 2: Thank god Detroit named at the Gordy Howbridge and not
Speaker 2: the Terrek School Bridge.
Speaker 4: Jeans Soroka, thank you so much.