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"Competitiveness" has become a hot topic for US states, municipalities, and ports. With slower post-recession economic and trade growth, there no longer seems to be more than enough business to go around. Now, we are obsessed with market shares.

Yet who is competing with whom, and on what basis? There have long been claims that US container ports are not "competitive" with the best European and Asian ports. Whether or not those claims are valid - and most are questionable - is anyone actually choosing whether to use a North American or European port for their trade? Rotterdam vs. Houston? Seattle vs. Singapore? While some observers may argue that relative port efficiency affects competition between nations, any difference between port costs in developed countries is likely to be negligible compared to differences in production and shipping costs.

Must North American ports automate to stay "competitive"? If automation really reduces long-run cost and improves service, shippers and carriers might prefer an automated terminal to others in the same port, or to others in a nearby port. But shippers changing coasts for automation per se? Not likely.

The high market share of Pacific Coast ports, and Southern California ports in particular, was driven by rapidly growing imports from China, development of the double-stack rail network, and the practice of transloading or distributing imports in Southern California, not because Southern California ports were cheaper. As trades and supply chain practices have shifted in other directions, so have market shares. The growth of trade with Southeast Asia favors Suez routes to the Atlantic Coast, and "four corner" import strategies spread volume among coast and ports. These are underlying trade shifts, not responses to small differences in terminal costs

One authentic competitive shift has been the growth of discretionary cargo at Vancouver and Prince Rupert. The coordinated efforts of ports, railroads, and government agencies in Canada's Asian Pacific Gateway Initiative has paid off.

The southeast ports, particularly Savannah, have also successfully partnered with other state agencies to spur economic development and link it directly to port volumes. As in Canada, it is not the small difference in port costs alone that is shifting trade, but a coordinated port and state effort.

The industry might profit more by looking behind the "competitiveness" curtain to learn how customers are making choices than by looking over their shoulder at other ports and nations.

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