GCT chief executive Doron Grosman said the company has been ‘proactively investing’ in capacity expansion and plans to invest further.
‘Our approach continues to be to provide adaptable, incremental capacity that appropriately services our customers, while maintaining our competitiveness for the discretionary gateway traffic’, said Mr Grosman.
Even amid the coronavirus pandemic, which has created almost overwhelming amounts of cargo around the globe, GCT Global Container Terminals is confident it has more than enough capacity to serve shippers.
That is no small achievement when other ports and terminals across North America are struggling to cope with the influx of ships and containers arriving in seemingly greater numbers week by week.
For Doron Grosman, chief executive of the Vancouver, Canada-based company, that ability has not come by accident but instead by the convergence of several factors which the firm has intentionally brought into play.
“Now, despite the surge going on, we’ve been proactively investing in capacity expansion, and that’s why we are where we are and we’re investing further,” he says.
Global Container Terminals’ investment also is in the people needed to keep cargo flowing. “We have been maniacally focused on keeping our workers and employees healthy. So we are not suffering from some of the challenges that some other marine terminals in North America are suffering from,” he says.
Not least, given how “absolutely critically” important getting to zero emissions and reducing our carbon footprint is, “we’re very, very focused on investing in and around ESG so that we are responsible marine terminal operators in the communities and countries in which we live”.
“So, we’re really in many respects, the marine terminal operator of choice for shippers who are coming in or would like to come into Vancouver or New York,” he says.
GCT operates four container terminals: one each in New Jersey and in New York, and GCT Deltaport and GCT Vanterm in Port Metro Vancouver.
Mr Grosman is highly aware of the problems at other ports and terminals, drawing attention to the backlog of ships and the labour shortages due to the coronavirus pandemic that have contributed to the congestion.
He says there are just four ships at anchor waiting to enter GCT, and regarding the loss of longshore workers due to the coronavirus, “we have fewer than the number of fingers on my hands”.
“So, we’ve got the workforce, we’ve got the capacity and we certainly have the technology. That’s why, whether they are the ONE alliance or THE or even the 2M alliance, they are moving significant volumes to us.”
In terms of investments, Mr Grosman refers to two types: those made in the past 24 months that are now fully operational and those that will be operational in “the near future”.
He mentions the terminal in Bayonne, on the Upper New York Bay in Jersey City, where the company has invested “heavily in terms of dedicated and committed technology” in the form of semi- automated RMG stacks which are “decoupled” from the yard activity.
“So, we can move velocity through there faster and more efficiently and also safer,” he says.
In Deltaport, GCT had completed part of its rail expansion with five tracks “before we even knew how to spell Covid” and then by the May to June timeframe the remaining two tracks were installed.
“So, we had seven tracks of what people call the most advanced, most automated rail loading facility in North America,” he says. “That project has increased the terminal capacity in Deltaport as of the middle of last year to 2.4M TEU and its rail handling capacity went up by about 50%.”
The investment enabled GCT Canada “to keep pace with our customers’ sudden return in vessel capacity, moving from void sailings to extra loaders,” he says.
Among other current investments, Mr Grosman notes the three-year modernisation project at Vanterm which has received two new super post-panamax cranes, now being made operational.
That will complete $160m of investment in Vanterm alone, counting the cranes along with other equipment and work done in the yard, all of which “increases terminal capacity there by 25%”.
Beyond those three investments, GCT has two further “very significant projects” in the pipeline. The first is in Bayonne, where the firm is intending to add a third berth and four new ZPMC super post-panamax cranes.
“A lot of the permitting around that is already done. The engineering is underway, the environmental stuff is underway, and that is about a $150m project” with completion expected by “the middle of 2024”.
On the Pacific coast, the company plans to add a fourth berth to its deep terminal facility at Deltaport.
“That project is already in the detailed project description phase. We’ve completed the initial project description, and the feedback period from the communities,” he says.
Expanding Deltaport is a “billion dollar” project and the firm anticipates having the impact statements for it completed in late 2023, with construction starting in the second quarter of 2006 and “everything should be completed and operational by the end of 2029”.
Mr Grosman neatly sums up the investments: “Bayonne, the stacks; Vanterm, the modernisation; and Deltaport, the rail. The two that we are investing in right now are Bayonne, the third berth; and Delta port, the fourth berth.”
While the investments being made — and in the making — have enabled the company to weather the ups and downs of the surges wrought by the pandemic, Mr Grosman is clear that no one invests in anticipation of surges.
“One builds a port not for a single-day surge or a single-week surge or a month surge. You build terminal capacity for steady growth into the future,” he says.
Such construction creates “swing capacity to deal with things sometimes in favour of what the BCOs and the shippers want. And sometimes the dwell times do extend a little bit, not out of desire, but you can’t have idle assets sitting there waiting for volume.”
“That would not be a reasonable businessperson’s investment, putting $100m or whatever the number is, $1bn, in the ground and then sitting around waiting for volume,” he says.
For Mr Grosman and GCT, the key is to build incrementally instead.
“Our approach continues to be to provide adaptable, incremental capacity that appropriately services our customers while maintaining our competitiveness for the discretionary gateway traffic.”
This article originally titled Global Container Terminals’ chief takes an incremental approach to investing written by Eric Watkins was originally published in Lloyd’s List on March 22, 2021.
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