The ports of Seattle and Tacoma have finally made a substantive announcement on joint talks that have been held behind closed doors this year. The ports received clearance from the FMC to meet and share confidential information on rates and other aspects of their business to “understand how ports can become more cost effective and operationally efficient without adversely affecting inter port competition.” 

The Seattle and Tacoma port commissions have now announced they plan to “unify the management of the two ports’ marine cargo terminals and related functions under a single Seaport Alliance in order to strengthen the Puget Sound gateway and attract more marine cargo for the region”.

The new Seaport Alliance will manage marine cargo terminal investments and operations, planning and marketing, but the individual port commissions will retain their existing governance structures and ownership of assets.

“This unprecedented level of cooperation between the state’s two largest container ports is a strategic response to the competitive pressures that are reshaping the global shipping industry” the ports said in a statement.

“The ports of Seattle and Tacoma face fierce competition from ports throughout North America, as shipping lines form alliances, share space on ever-larger vessels and call at consolidated terminals at fewer ports,” said Port of Tacoma Commission President Clare Petrich. “Working together, we can better focus on financially sustainable business models that support customer success and ensure our ability to reinvest in terminal assets and infrastructure.”

“Where we were once rivals, we now intend to be partners,” said Stephanie Bowman, co-President of the Port of Seattle Commission. “Instead of competing against one another, we are combining our strengths to create the strongest maritime gateway in North America. The Seaport Alliance is the result of our shared commitment to maintaining the economic health of our region through a thriving maritime industry.”

The key question of which terminals will be developed as container gateways for large container vessels has yet to be answered. If approved by the FMC, the two ports plan to enter an “Interlocal Agreement (ILA)” that will provide the framework for due diligence on strategic issues. “Following the due diligence period, the two port commissions intend to submit a more detailed agreement for the Seaport Alliance to the FMC by the end of March 2015”.

John Wolfe, Port of Tacoma CEO, and Kurt Beckett, Port of Seattle Deputy CEO, will co-lead the planning work during the due diligence period. "Commissioners from both ports expect to hold a public meeting next spring to hire Wolfe as the CEO of the Seaport Alliance following the FMC’s approval of the agreement” the ports said.