Duncan and Son Lines News

PierPass June News and Updates:

 TMF Fee Adjustment Postponed Until August 1, 2011

PierPass OffPeak Program Continues to Support Efficient Cargo Movement

 WCMTOA announced it will postpone until August 1 its planned adjustment to the Traffic Mitigation Fee (TMF) at the Ports of Los Angeles and Long Beach. The schedule change is in response to feedback from customers and other partners in the goods movement industry, and is intended to provide more time for cargo owners to prepare for the adjusted TMF.

  The OffPeak program provides tremendous value and future growth potential to the goods movement industry, greatly increasing the capacity of America’s largest port complex without adding additional infrastructure. OffPeak gates help to minimize daytime traffic congestion, allow cargo to move faster at night on less crowded roads, and enables truck owners to deliver more loads through lower turn-times and twice the number of working hours in a day. The TMF funds the nighttime gates, which make these benefits possible.

 PierPass Monthly Transaction Data  

As part of our monthly newsletters we provide a summary of the latest transaction data from marine terminal operators (MTOs) at the Port of Los Angeles and Port of Long Beach. Below please find data from the month of May 2011.

 Truck activity information derived from RFID data.

 Average in-terminal turn time:

·         35.5 minutes day shift

·         38.0 minutes night shift

(Excluding lunch hour, breaks and trouble tickets)

 In-terminal turn time is the average amount of time a truck is inside a terminal to complete a transaction. Turn time at individual terminals will vary depending on time of day and other factors. The average in-terminal turn time in April 2011 was 32.3 minutes for the day shift and 36.7 minutes for the night shift.

 Frequent callers* average moves per day:

·         18 percent of trucks made 5 or more moves per day

·         25 percent of trucks made 4 moves per day

·         33 percent of trucks made 3  moves per day

·         19 percent of trucks made 2 moves per day

·         5 percent made 1 move per day

 The ports define frequent callers as trucks making one or more moves per weekday. Average moves per day by frequent callers tells us how many moves a truck can make if it is working every day. In April 2011, 43 percent of frequent callers made four or more moves per day.

 Day vs. Night Gates:

·         Average number of day gate moves: 14,070

·         Average number of night gate moves: 14,750

·         Number of day shifts open: 26

·         Number of night shifts open: 17

Statistics reflect one stop work meeting and the Memorial Day holiday. Approximately 8,500 trucks regularly service the POLA/POLB.

The Current State of Cargo Volume

Industry leaders agree – international trade will continue to grow in 2011. However, growth in cargo volume in the Ports of Los Angeles and Long Beach is proving to be modest. While historically, we have started to see cargo volumes pick up in May, volume did not return enough to warrant reinstating the one PierPass OffPeak shift that several marine terminal operators suspended earlier this year. More information

For more information on these stories and other PierPass news, visit: www.PierPass.org.

You are receiving this email because of your interest in PierPass, the non-profit organization formed by marine terminal operators at the Ports of Los Angeles and Long Beach to address issues of congestion, security and air quality.

About PierPass

PierPass is a not-for-profit company created by marine terminal operators at the ports of Los Angeles and Long Beach in 2005 to address multi-terminal issues such as congestion, security and air quality. Under the program, all international container terminals in the two ports established five new shifts per week. As an incentive to use the new OffPeak shifts and to cover the added cost of the shifts, a Traffic Mitigation Fee (TMF) is required for most cargo movement during peak hours (Monday through Friday, 3 a.m. to 6 p.m.).

About Gladstein, Neandross & Associates (GNA)

With headquarters in Santa Monica, California, and in New York, New York, GNA is one of the nation’s leading environmental consulting firms specializing in emission reduction, energy and transportation policy, carbon management, and market development for clean, alternative fuel and efficient vehicle technologies. GNA, which has been working with PierPass since 2005, is distributing this email on behalf of PierPass.

PierPass Alert:  Marine Terminal Operators at the Ports of Los Angeles and Long Beach Raise TMF to Sustain Continued OffPeak Operations The West Coast MTO Agreement (WCMTOA) yesterday announced it will raise the current Traffic Mitigation Fee (TMF) at the Ports of Los Angeles and Long Beach to $60 per TEU in order to sustain continued operation of PierPass OffPeak gates. The TMF adjustment is effective July 4, 2011.

This is the first increase in the TMF since 2006. Since then, labor costs have increased 31 percent. The terminals have operated the OffPeak shifts at a loss since the program’s start in 2005. The shortfall between TMF revenues and OffPeak gate costs was $52.3 million in 2010.

Adding the night shifts in 2005 substantially increased costs for terminal operators. The immediate effect of opening the night shifts was to spread the same amount of volume over twice the number of hours.  Additionally, nighttime labor rates are significantly higher than daytime rates.

While OffPeak was never intended to be a profit-making venture, the terminal operators can’t continue sustaining operational deficits at the current levels. A number of options were evaluated by marine terminal operators to cut the losses, including adjusting the TMF, decreasing the services offered, or instituting a fee on OffPeak cargo.

Adjusting the rate was determined by the marine terminal operators to be the most effective and least disruptive way to reduce the losses.

The new rate of $60 per TEU (twenty-foot equivalent unit) translates to a TMF of $120 per FEU (forty-foot equivalent unit).

Beginning in mid-2012, the TMF will be adjusted annually based on changes in Pacific Maritime Association maritime labor costs.

With 55 percent of cargo movements taking place during OffPeak hours, the program has become an important element of port operations. The Sent via BlackBerry from T-Mobile

Duncan and Son Lines Inc. has been named as the Phoenix Container Yard provider for Hapag-Lloyd.

 Hapag-Lloyd is a leading global liner shipping company with more than “135 container ships. For more than 160 years the company has set industry-wide benchmarks for reliability, service, productivity, and environmental protection…Hapag-Lloyd offers about 80 liner services between all continents and has a fleet with a total capacity or more than 600,000 TEU.”  (http://www.hapag-lloyd.com)

Duncan & Son Lines has become the Southwest’s largest intermodal transportation mover of international containers moving cargoes between the Ports of Los Angeles and Long Beach to and from areas in Arizona, New Mexico, Nevada, Utah, California, Texas and Northern Mexico.

Keith Jones, National Sales Manager for Duncan and Son Lines commented “We are extremely pleased to become the Container Yard provider for an outstanding Steamship Line such as Hapag-Lloyd.  Partnering with a global leader further enhances our presence as the primary provider of intermodal trucking services in the Southwest”.

Family Tradition

Duncan and Son Lines trucking company has grown up through four generations

By Annemarie Martin (Road King)

With nearly 70 years in business, Duncan and Son Lines has seen both the challenges and rewards that come with being a family-owned trucking business. Richard Blaine Duncan Jr. and his son Rick shepherded the once small company through tough times to grow into a 200-truck operation today. Rick’s sons are next in line.

Rick Duncan’s grandfather, Richard Blaine Duncan Sr., founded the company in 1943 with two flatbed trucks he used to haul cotton, grain and produce throughout the southwest. At that time, truckers in Arizona needed permits to operate within specified areas. Duncan and Son’s first permit allowed the company to haul within a 25-mile radius of Buckeye. By the 1950s, Duncan Sr. had acquired a new permit (then valued at $250,000) to work anywhere within the state of Arizona, and he primarily transported cotton and ore.

When deregulation hit in the early 1980s, the company had to scramble to survive.

“Deregulation hurt us,” says Rick Duncan, current president and grandson of the founder. “It broke down the barriers of entry into the business, and some of our former drivers were competing against us.”

The company had to get a lot smaller, going from about 70 trucks to 20, and the Duncans had to move out of their comfort zone.

“We had to regroup, to start over. It was tough times,” Rick recalls.

Being family-owned turned out to be a strength that helped the company get through deregulation.

“We operated in a very conservative manner because we are a conservative family,” says Rick. “Being conservative meant we did not borrow against our operating rights, which became useless overnight. It also meant that we could pull back our horns and circle the wagons, so to speak, in order to weather the lean times.”

Passing the torch
Still, while family can come together when necessary, those same close relationships present certain difficulties. Rick’s father, Richard Blaine Duncan Jr. (who is now retired), found that transitioning leadership from the first generation to the next was challenging. He had his own business ideas that he felt strongly about.

He was eager to expand, invest in equipment and move the company forward, but his father was eyeing retirement and was conscious of expenses and cash flow. The two had to find a way to meet both of their needs.

“My grandfather had nursed the company from infancy to where it was and saw it as his baby,” says Rick.

Such an attitude is not unusual for company founders who often find it difficult to release control, says Duff Swain, president of the Trincon Group, a trucking business consulting firm.

“Some of that has to do with the fact that companies of this type often were started by larger than life, entrepreneurial characters who raised their families and operated their businesses in much the same way,” Swain says.

Getting past such an obstacle requires discussion. What does each participant want? Why is it important? How can the different goals be reconciled?

“The company should try to accomplish the needs of both parties,” Swain says.

In the case of Duncan and Son Lines, Richard Blaine Jr. focused his expansion efforts on buying near-new used equipment to save on costs, but still provide quality service. He also made sure he kept his father informed of every move he made.

“My father was very cognizant to keep my grandfather in the loop on major expenditures,” says Rick.

Looking past their backyard
One early investment the company made under the senior Duncan was to build a 26-acre container yard in Phoenix so that it could start hauling ocean containers to the West Coast. With the nation’s textile industry moving into outsourcing, manufacturing of products overseas, it seemed like a good move. Cotton companies were interested in getting their products to ports in Los Angeles and Long Beach, Calif., and then overseas.

“Our cotton customers helped us because they wanted a cheaper way to get their product to port,” says Rick.

Even so, the Duncans had to pound plenty of shoe leather into the pavement to sell their services.

“We just got out and started going everywhere in the country where there was a shipping line or a customer,” Rick says. “We got a break in the late 1970s when one of the shipping lines started using us. That got our foot in the door.”

That was around the time that Rick’s sons, David and Blaine, who are now 32, were born.

Learning the ropes
Each of the younger Duncans started working for the company when they were in their teens, sweeping the floors and doing other entry-level work.

The sons say that these early experiences were invaluable in giving them a feel for the trucking industry and whether they wanted to be in it. It also gave them an overall view of the company’s various facets and departments.

“We got to know a little bit about each function,” says Blaine, adding that they also got a better understanding of what roles within the company would best suit their talents and interests.

“It is a matter of trying to figure out what makes each of us tick and where each others’ strengths lie,” says Rick.

David rotated through various departments including accounting, dispatch, safety and loss prevention. That last role involved a somewhat unique task — branding tires.

“We’d put our name on the tires to keep them from being stolen,” David says. “Imagine branding tires in 110-degree heat. It was bad enough that I only did it two weeks.”

David decided to keep his focus on operations and dispatch, where he came face to face with people rather than tires.

“I like interacting with the drivers and the customers,” he explains.

Early on, Blaine decided he wanted to understand what it was like to be one of the drivers.

“I got my CDL,” he says. “And I worked in the shop. It really taught me about maintenance. I broke down a couple of times so I know what a driver feels like sitting on the side of the road.”

Today, David is vice president of operations and Blaine is director of equipment and maintenance. Their father handles administrative and financing duties and manages growth.

The importance of family
Besides investing in maintaining safe equipment, the company also has invested $12 million over the past few years to make its fleet more fuel efficient and cleaner. An added incentive is that shipping ports are imposing higher fees on trucking firms that want to enter their ports, but which are not operating a green fleet.

Being a conservative family and maintaining good credit meant the company was able to make that large investment when it was needed.

The company now has about 200 trucks, most of which are its own. It also hires between 25 and 80 independent contractors, depending on demand.

Rick says having strong family ties means the company also is aware that their employees have families and relationships that must be tended.

“We try to get our truckers home a couple of times a week,” Rick says. “That helps us attract a better quality employee.”

Being in a family business is a thrill for Rick, who likes being able to work alongside his sons.

“When you work with family, you can have that level of trust that might be difficult with other people,” he says.

Despite that bond, he believes that it’s important in a family-owned business to make family members aware before they get into it about the many demands and expectations that it will entail.

“You have to be upfront about the amount of work that’s involved,” Rick says. “But if you get out there and hustle you can keep everyone busy.”

The Duncans say that the bottom line when it comes to staying in business and growing over nearly seven decades is being fair and honest with others and also appreciating the value that each family member brings to the table.

http://roadking.com/2011/05/family-tradition/