Nardi is focused upon productivity in leading NY Shipping Association

Maritime shipping industry veteran John Nardi faces many challenges. As president and chief executive officer of the New York Shipping Association Inc., he’s concerned with competitive productivity of the Port of New York and New Jersey, including as the model for chassis provisioning changes. And, on the home front, he’s uneasy about getting beaten by the rest of his family at golf. In an interview with the American Journal of Transportation, Nardi affably talks about how a lifetime on and around the waterfront has prepared him to tackle his priorities at NYSA, which he joined in January 2012 as executive vice president and of which he became top executive in the spring.

You have said that the Port of New York and New Jersey is in a critical transition period. Can you explain what you mean by this and what the opportunities are for the port and, therefore, the region? At this point, the way I look at it, I see that the hard work of many people in the past is starting to come together. The dredging in the port is nearing completion. The Bayonne Bridge is being raised. The terminals in the port have invested hundreds of millions of dollar in infrastructure. And now we have our new labor agreement. All of this is being done in anticipation of the widening of the Panama Canal. The transition period is converting from a Panamax gateway to a post-Panamax gateway as the canal is enlarged. The opportunity, of course, is the economic benefit of this additional cargo that comes through the port. But, for this to happen, the stakeholders in the port, we’re going to have to come together and have some serious dialogue on how we’re going to be able to handle the larger ships and this cargo growth. Questions have to be answered about perhaps longer gate hours, do we have enough chassis, can the supply chain today coexist with daytime pressure on our roadways? These are questions that I think we need to start asking each other now, so that, when the time comes, we’ll be able to handle it in an efficient way. Earlier this year, success was achieved, after more than a year of negotiations, with the signing of a new six-year master contract with the International Longshoremen’s Association. What is the significance of this new contract? The contract bargaining on our side was really focused on improving the productivity in the Port of New York and New Jersey. The port has historically been one of the most expensive ports in the world – and the least productive from a labor intensity point of view. The key here, in an era of intermodal competition, is that we’re competing for discretionary cargo with many different gateways. That’s really where the growth is as we go forward. We’ll have some organic growth locally, but really the target is for this discretionary cargo. Fortunately, the ILA leadership in New York and New Jersey recognizes this, and they were concerned that New York regains their competitive position and that we’re able to continue to grow. Because of this, we were able to include productivity improvement wording in our agreement, which is a first, and we were able to begin to address some of the high-cost staff positions in our port, and we have an agreement to address these costs as well. The main focus is really on productivity, making the port more productive. And, at the same time, keeping labor happy… Yeah, but, you know, I think growth makes everybody happy, but you can’t have one without the other in this case. Belated congratulations on your promotion to NYSA president. What are your priorities for the association? The focus of the association at this point is pretty simple: It needs to be on productivity and implementing the new agreement. Today, in our world, in the shipping business, yield systems and computers determine how cargo is routed, not people. So it’s important to get our costs to the point where New York and New Jersey is the automated choice for cargo routing. The days of bringing a bag of doughnuts to the booking clerk are over, y’know. Ah, I remember those doughnuts, I mean days… They were good days, but, unfortunately, routing systems have taken their place. So, if you’re not competitive, there’s no hiding it. And, if you want the incremental cargo, you’ve got to be the most efficient. When you came aboard at NYSA, you brought with you nearly three decades of ocean carrier experience, first with Atlantic Container Line and then with Hapag-Lloyd, last serving as Hapag-Lloyd’s senior vice president for operations. How has your steamship line experience served you well in your role at NYSA? At Hapag-Lloyd, I was responsible for operations for both North America and South America, and that’s a pretty big scope. So I’m able to see and compare New York and New Jersey to many other operations. I’ve been able to see what ports do well and what other ports don’t do well. And the same thing goes for New York. I think that sometimes people working in New York are naturally inwardly focused and don’t see that nearly every other port in the country is trying to take cargo away from us. So, having this broader view gives me the advantage. When having discussions on what it will take to further grow the port’s volume, I’m able to apply what I’ve learned but also what others are doing to try and take our cargo away and try to combat that. You’ve served on a number of industry boards, including as chairman of the Ocean Carrier Equipment Management Association. I’m curious, in light of your OCEMA role, what impacts you believe will be seen as a result of the changing model for U.S. chassis provisioning, with ocean carriers getting out of doing so? Yeah, chassis is one of my favorite subjects. Chassis provisioning in general is probably one of the – if not the – biggest challenge our industry is facing. There are a lot of good reasons why ocean carriers wanted to get out of the chassis providing business. You have costs. You have liabilities. And, frankly, it’s not their core business. Their core business is to provide ocean transport, not chassis. So why not let others do it who are focused solely on chassis? Here’s the concern. I previously mentioned all the work that’s being done and money that’s been spent in the port preparing for a post-Panamax era. But it’s worrisome to note that chassis provisioning can potentially bring the supply chain to a grinding halt if it’s not dealt with in a proactive way. And, even if entities get their own fleets, I don’t see them really having an advantage if the entire port is congested due to chassis supply problems. So you can have your own chassis, but you’ll have to wait on a line anyway trying to deal with all of the other congestion in the port. At this point, I think the stakeholders need to reach out to each other and get together once and for all and hammer out a model which works for everyone. I personally have some ideas, and I’ve been having some brainstorming-level discussions with stakeholders, and it seems like most parties are in agreement that things need to change. I don’t think you can take the current chassis model that we have in New York and apply it three or four years down the road with the larger ships and the [expanded Panama] Canal opening up. We need to start talking about it now to be ready for it then. So what’s at the heart of a couple of those brainstorms? Well, I think the port is very fragmented in the way chassis are provided, and I think you need a more seamless way to do it. And there are some models that work in other ports that maybe can work in New York. I know you are a graduate of the State University of New York Maritime College and earned your third mate’s license at an early age. How young were you when you first decided you would pursue a maritime industry career? I’m still wondering that actually. Well, I grew up in Queens and Long Island, and I was around water my whole life. I guess it was just a natural progression that when you grow up working in marinas you continue to work on boats, and one thing led to another, and here we are in the Port of New York. What did you do working in marinas? Selling fish, painting bottoms of boats, working on engines. I didn’t know how good I had it. Are there times you wish you were still selling fish? When you see the price of fish, yeah. You’ve always had a passion for sports. How are you remaining active today with fishing, golfing and coaching? Well, my coaching days are over because my children’s skill level has far surpassed my ability to help them. So most of my free time is spent watching my younger son, who’s a baseball player in high school. And, for golf, I’m usually getting beat by both my children, and I’m currently trying not to lose to my wife, who keeps getting better every year, so it’s a challenge. It seems like everybody in the Nardi family is getting better at golf but me.