AAPA Seaports
By Sandy Smith
Everywhere one turns, industries are facing automation. Robots, artificial intelligence, driverless vehicles. Ports will be changing as well.
But as the next wave of technological revolution looms, ports are slowly looking at ways to automate — without getting too far ahead of the technology.
“We look at some of the technology evolutions to say, ‘What can we implement in a prudent way that improves safety, operational tempo and utilization of our acreage in an optimal way?’” said John Reinhart, CEO and executive director of the Port of Virginia. “We don’t want to go off and reinvent the world, to put in technology that hasn’t been proven. We’re going to be second adopters. We’re not going to be rushing to be cutting edge. We don’t want to want to make a mistake.”
Baby Steps
That’s not to say that the Port of Virginia hasn’t dipped its toe into automation. The Port of Virginia has upgraded its terminal systems in the past year to accommodate rubber-tired gantry (RTG) cranes. That has allowed “better density in our stacking.”
The Port of Virginia also has updated its rail-mounted gantry (RMG) stacks, which “use advanced terminal software to improve ship side and truck side delivery,” Reinhart said. Both steps are part of the Port of Virginia’s goals of improving production by 1 million containers over the next three years. The Virginia International Gateway, a semi-automatic terminal that the Port of Virginia leased in 2010, includes RMGs and uses optical character readers (OCRs) on truck gates and rail gates. At the Port of Virginia’s Norfolk International Terminal, plans are to add RMG cranes and stacks instead of the current straddle stacks. “What that would allow us to do is add 400,000-capacity to that facility,” Reinhart said.
While RMG is an established technology, Reinhart notes that in the last decade, it has seen improvements in lasers and speed on lifting. The Port of Virginia currently is testing hybrid shuttle trucks and cars to improve on sustainability. It also has modernized gates so that workers can be in air-conditioned environments.
The Need for Speed
While capacity certainly is a consideration for automation, speed is another. The Port of Long Beach (Calif.) opened up the now fully automated Middle Harbor terminal earlier this year with a goal of improving the truck turn times.
“The truck can move into position, offload its container and stay in the exact position,” said Jon Slangerup, the port’s CEO. “It will receive its outbound container all in one single visit. It certainly is the most trucker-friendly facility we’ve built to date.”
But it’s the speed that is most impressive. Just a few months after going live, Middle Harbor is “currently operating around 35 percent of the full build-out footprint,” said Anthony Otto, president of the Long Beach Container Terminal, the facility operator. “Our new technologies, including our cutting-edge trucker interface, have been fully integrated into our operations and are running smoothly.”
Slangerup said that the system currently outpaces other automated terminals, “but of course, it’s a newer generation of technology, so it has the benefits of all the lessons learned. I’m sure in some future place, there will be even more improvements.”
Otto points to “real-world testing prior to our ‘go live’ date. Operational experience suggests that exhaustive testing is the best predictor of potential problems. Because of our commitment to testing and training on every system — from our cranes to our AGVs — we positioned the company for a more problem-free start, avoiding any major operational challenges after our launch.”
The Need for Training
As Middle Harbor transitioned to fully automated, it required a partnership with key stakeholders. “We’ve been extremely proactive in our outreach with the trucking community and the feedback we have received has been positive,” Otto said. “We will continue to foster this relationship with the drayage community in order to maintain the high levels of success we are currently experiencing.”
But it has taken a concerted effort between the terminal operator and its parent company, Orient Overseas Container Line (OOCL). Together, the two have “committed nearly $8 million in assisting the International Longshore and Warehouse Union (ILWU) membership with re-training and development of the niche skillsets required for the modernized systems at the new facility,” Otto said. “We will continue to work with the ILWU and other stakeholders on these advanced training programs.”
And that is a vital component of any automation project: ensuring that workers are trained on the new technology and made aware of the benefits.
“We have a pretty good workforce and are working well with our labor partners,” Reinhart said. “You have to use technology to augment a good workforce so that you can handle more. We also have to be forward-thinking; what skills and training do we need to put in our workforce today to handle the technology of the future? You have to train as you go along.”
Slangerup notes that automation does not automatically mean job cuts. In the case of Middle Harbor, automation is being used to expand from 1 million TEUs to 3 million. “While there may be productivity gains as we fully deploy this terminal, there will be substantial net job growth,” he said. “That is in jobs that are higher tech and higher paid than conventional minimally trained or skilled labor. It’s the best of all worlds. The longshoremen that I’ve spoken to up in the cabs or control rooms love their jobs. The first thing that comes out of their mouths is, ‘I’m not going to hurt anybody.’ In the traditional manually operated terminals, there’s a high degree of risk to life and limb. In this environment, the risk is mitigated for the human factor. It’s still moving boxes around by automated means, so there is always some risk, but if something unfortunate happens, there’s not going to be a human involved.”
And then there are the improvements to the job itself. “Their physical environment is air conditioned, and it is intellectually stimulating work,” Slangerup said. “It is a whole new world and it is the future. They love that opportunity.”
He points to the way that labor was involved in the project a decade ago, when it was just a concept, “to seven years ago when the designing was beginning to happen.” Labor leaders were taken to Hong Kong to understand the plans, the commitment to labor and training. “While there is still a natural fear about what automation looks like, this is the poster child for how things can happen in a favorable way.”
Onsite Incubators
As today’s ports explore automation, terminal projects and ports themselves can serve as test sites for future automation.
Slangerup notes that, as Middle Harbor continues to exceed expectations, other “well-funded terminal operations may say, ‘We want to go that way.’ We will accommodate that. That’s our job. It’s also our job to make sure that we invest wisely.” He does not anticipate that future ports will all look the same — and even individual terminals may look different from another. “In our own port complex here, we have 22 marine terminals, six of which are large-scale container terminals. They’re all looking at Middle Harbor with concern because if it does what it is capable of doing, it could represent a competitive advantage. But in really talking it through and looking at the future, the reality is that much of what Middle Harbor is accomplishing or can accomplish can be replicated in a semi-automated or manual environment.”
Some of what drove automation at Middle Harbor was strict environmental standards in California. Slangerup notes that manual operations can be electrified to meet those same goals. “All of that will find its way into these terminals in a way that allows them to achieve environmental benefits that the state of California expects ports to achieve. Longshore workers are committed to demonstrating that they can perform just as well as a machine.”
Across the country in Virginia, the port authority has an advantage of having six ports. “We have live incubators where we can test some of the technology,” Reinhart said. He points to Craney Island, a port expansion due online in a couple of decades. While Craney Island is expected to be a state-of-the-art container terminal handling at least half of its total container volume by rail, even Reinhart doesn’t know exactly how the port will look when it opens.
“The shelf life of a lot of today’s technology won’t last that 20 years,” he said. “What we know is that we’ll be evaluating the technology to say, ‘What is the next right thing to do?’”
Europe is, in some ways, a few years ahead of North America in automated ports. In 2015, the Port of Rotterdam, Netherlands, opened its fully automated terminal, featuring automated guided vehicles (AGVs) and automated ship-to-shore cranes. A year later, though, the automated port wasn’t quite living up to its potential. It had faced a labor issue over lost jobs and was blunted by global economic challenges, leaving behind its ambitious productivity goals, Marine Vessel Times reported.
With Craney Island, the focus now is on getting the footprint right — and the way the port interfaces with road, rail and water. “You take the footprint and can simulate some of the technology as it evolves,” Reinhart said. “You really have the ability to test different approaches before you start to go to construction.”
Craney Island will be built out in cells, probably handling about 1 million TEUs at a time. “You don’t want to overspend,” Reinhart said.
And the same goes for technological revolutions. “You have to have a business case that you can justify and get a return on that capital investment,” Reinhart said. “You do have to not be pie-in-the-skying too much. What we try to look at is what’s the business going to do.”
Still, Reinhart notes, some future technology is inevitable. Just like computers revolutionized all types of businesses, he believes that some of what will impact ports will have broader business applications. “I think one of the next things we will look at is where else you can use better artificial intelligence to preplan activities so that you are being proactive, not reactive. That’s the next big step: getting more of the big data from the carriers and shippers on the front end and using that to plan your activity.”
He also believes ports can take more advantage of social media to communicate with users and the public, letting them know of gates with issues or extended hours.
More specifically to ports, though, he believes eventually someone will figure out how to create collapsible containers. “Reliability is so key. You don’t want to run away from proven technology until experimental technology has had a stress test and then you can be an adopter.”
Slangerup, who came to the port in 2014 from logistics, sees “nothing but blue sky ahead.” But he anticipates significant evolutions in technology. “When I came, I was shocked at how little was integrated. The great opportunity to me in supply chain is to optimize it across platforms that talk to each other. The evolving alliance structures among the carriers provide the opportunity to start to look at effectively matching capacity to demand through appropriate deployment of those expensive assets. You’ll see, over the coming years, the marine supply chain getting very, very competitive.”
And one thing remains clear: With the rapid pace of technological change, it isn’t prudent to plan too far out. “There could be a disruptive technology that comes out,” Reinhart said. “What’s going to happen in global trade? Now the box rules trade. The power in our phone is better than computers were just a few decades ago. We’re doing things that may change the demands on shipping.”
He points to Moore’s Law, an idea that computer productivity essentially doubles every few years. “You can turn that to the terminal business,” Reinhart said. “It continues to speed up its rate of change. If we’re making decisions based on what will happen 20 years from now, we’re going to make the wrong decision. We just have to build the pathways.”
