FedEx taps 3 charter vessels to start congestion bypass service

Dive Brief:

FedEx Logistics' congestion bypass service is now underway, with the first of three charter vessels transporting 53-foot containers set to arrive at California's Port of Hueneme by the end of January, according to a news release.
The arriving vessel has a capacity of 300 53-foot containers per sailing. The containers, originating from China's Port of Humen, will eventually be used in FedEx Freight's intermodal network in Southern California, according to FedEx Logistics spokesperson Christina Meek.
FedEx used to import these containers empty, but the company has begun to sell their capacity as shippers seek to avoid congestion at the San Pedro Bay ports. The containers hold electronics, automotive materials, clothing and department store merchandise, according to the release.

Dive Insight:

FedEx Logistics' new service is using a destination port less than 100 miles from the ports at Los Angeles and Long Beach, ensuring that imported freight is still close to supply chain operations concentrated in Southern California.

FedEx Logistics CEO Udo Lange told Supply Chain Dive in December that shippers can cut 20 days' worth of transit time port-to-port by using the bypass service rather than having freight shipped to the San Pedro Bay ports.

"LA can be seen as the heart of the supply chain to a certain extent," Lange said. "Now you have a clogged artery there, and you can't just pump it out anymore. Now you really need to do more drastic heart surgery and from then on reintroduce flow."

FedEx's efforts are among the innovative ways stakeholders are tackling West Coast cargo backlogs amid a flood of imports. The Port of Hueneme, which ranks vehicles and fresh produce among its top imports, is also seeing increased activity — November imports increased 13% YoY.

FedEx's charter vessel will dock at a U.S. Navy terminal, Port of Hueneme Public and Government Relations Manager Letitia Austin said in an email. In November, Naval Base Ventura County (NBVC) and port owner Oxnard Harbor District activated an agreement to leverage Navy resources to help decrease port congestion in Los Angeles County.

"The Port appreciates the partnership with NBVC and locating additional space to accommodate excess holiday shipments coming through the Port," said Jason Hodge, president of the Oxnard Harbor District, in a statement. "We are delighted to come together to meet the challenge of providing a solution to help keep essential goods moving."