The Los Angeles City council has dealt APM Terminals’ automation plan for Pier 400 a major blow.
The Los Angeles City council has voted unanimously to refer the coastal development permit for infrastructure for the electrical charging and wireless communication system at Pier 400 back to the Los Angeles Harbour Commission. APM Terminals applied for the permit to as part of its plan to implement up to 130 Kalmar automated straddle carriers at Pier 400, which is currently a top pick and RTG operation.
To be clear the Council has not denied APM Terminals the permit. It passed two motions: one to assert jurisdiction over the Harbour Commission’s decision in this matter, and one to refer the matter back to the Harbour Commission for further consideration.
Port of LA Executive Director Gene Seroka has always been clear that it is not up to the port to determine how operators run their facilities, and that the permit AMP Terminals required was a minor technical issue. That view was upheld by the Los Angeles Harbour Commission when it voted 3-2 to reject an appeal by the International Longshore and Warehouse Union (ILWU) over the coastal development permit.
Los Angeles Councillor Joe Buscaino then took the matter to the Los Angeles City Council. Prior to the meeting a letter from APM Terminals was circulated in which the company asserted its right under its current lease and the Pacific maritime Association (PMA) contract with the ILWU to introduce automation, and threatened that if the permit for the charging infrastructure is denied it would push ahead with fully diesel powered equipment.
As soon as the Council meeting began it was clear that APM Terminals never stood a chance. In front of a packed city hall Council President Gilbert Cedillo stated that while he respected the Harbour Commission “sometimes we have to let people know that we are elected, they are selected. We are in the people business”.
The Council wasted no time in voting to take jurisdiction of the issue and refer the permit back to the Harbour Commission with the expectation that it would receive much more detailed consideration, including all the economic and social impact studies a Level Two coastal development permit requires. That process has the potential to take years.
In making its decision the Los Angeles City Council never heard evidence on or considered APM Terminals contractual rights under either its facility lease or the PMA contract with the ILWU. It was also never mentioned that there are already two automated terminals in San Pedro Harbour (TraPac and LBCT), both of which operate under the same Master Contract with the ILWU.
APM Terminals might decide to push on and implement automated straddle carriers without Kalmar’s Fast Charging System in defence of its contractual rights, or seek another legal remedy. It would be aware, however, that the tone at the Council indicated the ultimate owners of the Port of Los Angeles have decided large scale automation is a breach of a social contract and are willing to change the rules if necessary to prevent it happening.