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Biden enlists Target, Walmart to fix bottlenecks threatening holiday sales

Stock MarketsOct 13, 2021 09:40PM ET
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© Reuters. FILE PHOTO: U.S. President Joe Biden speaks as he participates in the virtual CEO Summit on Semiconductor and Supply Chain Resilience from the Roosevelt Room at the White House in Washington, U.S., April 12, 2021. REUTERS/Kevin Lamarque

By Alexandra Alper, Steve Holland and Nandita Bose

WASHINGTON (Reuters) -President Joe Biden on Wednesday urged the private sector to help ease supply chain blockages that are threatening to disrupt the U.S. holiday season and said the White House plans a nationwide overhaul of the clogged system.

Biden said the Port of Los Angeles would join the Port of Long Beach, two of the country's busiest, in expanding round-the-clock operations to unload an estimated 500,000 containers waiting on cargo ships offshore.

Walmart (NYSE:WMT), Target (NYSE:TGT) and other big retailers https://www.reuters.com/business/how-target-home-depot-ups-fedex-plan-ease-us-port-congestion-2021-10-13 would also expand their overnight operations at the ports to try to meet delivery needs, Biden said.

It is a "big first step" to revamping supply chains in the United States, the world's biggest consumer market, Biden said, adding the government would be heavily involved.

"If federal support is needed, I'll direct all appropriate action, and if the private sector doesn’t step up, we’re going to call them out and ask them to act,” the president said in remarks at the White House.

The broader goal, he said, is to address long-standing weaknesses in the U.S. supply chain.

The stop-and-start nature of the pandemic has snarled global supply chains that are optimized for just-in-time movements of goods.

The supply crisis is driven in part by the global COVID-19 pandemic, as sales of durable goods jumped amid worker shortages and transportation hub slowdowns https://www.reuters.com/business/autos-transportation/containergeddon-supply-crisis-drives-walmart-rivals-hire-their-own-ships-2021-10-07. A shortage of warehouse workers and truck drivers to pick up goods is partly to blame.

Lower-than-expected Christmas sales could hurt U.S. companies and pose a political risk for Biden, who is already battling a host of other domestic problems in his first year in office.

The latest Reuters/Ipsos poll shows the economy continues to be the most important issue for Democrats and Republicans alike.

White House officials have said that Americans may face higher prices and some empty shelves this Christmas https://www.reuters.com/world/us/americans-may-not-get-some-christmas-treats-white-house-officials-warn-2021-10-12 season due the supply chain problem.

White House spokesperson Jen Psaki told reporters Biden could not guarantee there would be no holiday disruptions.

"What we can do is use every lever at the federal government level to reduce delays," she said, when asked about the possibility of mobilizing National Guard or other troops.

ALL HANDS ON DECK

Besides the stepped-up port activity, three large carriers of goods - Walmart, FedEx (NYSE:FDX) and UPS - plan to step up their round-the-clock operations to speed the shipment of goods across the country.

Samsung (KS:005930), Home Depot (NYSE:HD) and Target are also increasing their work in off-peak hours.

The White House expects the pledges from the six companies to expand their hours will amount to 3,500 additional containers moving each week through the end of the year.

Biden spoke after meeting with executives from the two ports as well as from the International Longshore and Warehouse Union, the Teamsters, the AFL-CIO, Walmart, FedEx, UPS, Target, the National Retail Federation, the American Trucking Association, the Pacific Maritime Association, and more.

Some CEOs scheduled to attend noted they are already working around-the-clock. "We’ve been running 24/7 supply chain operations for years, including at the ports," said Target CEO Brian Cornell in a blog post https://corporate.target.com/article/2021/10/supply-chain-update ahead of the meeting.

Target handles about 50% of its containers that arrive in California ports at night, he wrote, and is committed to increasing that amount by 10% over the next 90 days.

The Consumer Brands Association urged the White House to set up a supply chain war room and bring in private sector experts and government officials to help rapidly identify problems.

“We cannot ignore the warning signals of higher prices and reduced availability,” said the trade group's CEO, Geoff Freeman.

The White House has been trying to tackle inflation-inducing supply bottlenecks of everything from meat to semiconductors. The administration formed a task force in June that meets weekly and named a "bottleneck" czar, John Porcari, to push private-sector companies to find ways to get goods flowing.

Biden enlists Target, Walmart to fix bottlenecks threatening holiday sales
 

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Comments (17)
Eudon Hickey
Eudon Hickey Oct 14, 2021 12:29AM ET
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How easily he overlooks the small/medium businesses to help and support
Mark Stallone
Mark Stallone Oct 13, 2021 11:06PM ET
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Very interesting article. I've given it a good read, and have come to one conclusion.. Let's go Brandon.
Paul Browning
Paul Browning Oct 13, 2021 10:56PM ET
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A major problem for world trade was created by Trump's I'll conceived trade war with China. He never understood world trade and was just playing politics. The pandemic has also been a major disruptor. Biden is trying to get government and private industry to work together to remove the bottlenecks. He seems to be having some success.
Co Gonz
Co Gonz Oct 13, 2021 10:56PM ET
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is this serious- how confused can you be- look at the data and turn off the tv. biden stimulus kept people from working, vaccine mandates keep people from working, energy issues from net zero have caused plants to close due to lack of energy- biden told america to stop creating energy making shortage worse- biden plans for 3 trill package that would hurt supply chains more- want me to keep going?
Co Gonz
Co Gonz Oct 13, 2021 10:56PM ET
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next you'll say gas prices aren't bidens fault either- biden told america to produce less= more demand with less supply= prices up- biden administration focused on esg and diversity rather than cyber security of hacks that shut down areas
Rodney Dangerfield
Rodney Dangerfield Oct 13, 2021 10:56PM ET
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Co Gonz actually it's Trump's fault he signed the deal with OPEC
Tyrone Jackson
Tyrone Jackson Oct 13, 2021 10:33PM ET
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Typical liberal. Blaming the private sector when it’s their policy that f’ed everything up in the first place . If the economy is so hot- why aren’t there enough truck drivers? Why are they not hiring at the ports?? Haha because no one wants to hire. They see the layoffs around the corner. Biden knows that he f’ed up the holidays already. Inflation will rage for years with his scheme. Another 4-6 trillion for his scheme.
Vlad Lozovskiy
Vlad Lozovskiy Oct 13, 2021 10:13PM ET
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What a mess.  You still believe socialism is working?  This is just the beginning.
Roger Miller
Roger Miller Oct 13, 2021 10:07PM ET
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Notice how they say and do little for the small and medium size business’, who are the main driver of employment. Instead they cater to the big companies and big unions.
Roger Miller
Roger Miller Oct 13, 2021 10:07PM ET
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Mean while their other failures keep mounting.
Nathan Prather
Nathan Prather Oct 13, 2021 10:05PM ET
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Biden has a knack for blaming others and not actually solving the problems he himself caused.
gene morris
gene morris Oct 13, 2021 9:51PM ET
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who believes this *****
Pedro Trost
Pedro Trost Oct 13, 2021 9:48PM ET
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Hes fixed nothing and ruined everything. What makes you think he can fix this problem he caused in the first place.
palmer gossett
palmer gossett Oct 13, 2021 9:28PM ET
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Can't believe the thumbs down I'm seeing on many comments. When are you going to wake up and stop defending this imposter in the white house. You know, the one that is wearing a diaper and a mask. He's done nothing that he promised you. And with all of the illegals flooding the country. They're the ones taking those of you who actually work jobs. And most will be on welfare potentially lowering your benefits for most of you who are living off the taxpayers dime. Y'all are the one's that should be up in arms revolting this mess
Jack Bquick
Jack Bquick Oct 13, 2021 8:28PM ET
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This 100% Biden's fault.
Connecticut Yankee
A_Jaundiced_Eye Oct 13, 2021 7:24PM ET
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"urged the White House to ...bring in private sector experts and government officials to help." That's it: bring in people from the private sector to help, then follow with bureaucrats to overturn what those people just did.
Steven Kilgore
Steven Kilgore Oct 13, 2021 6:05PM ET
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Aside from using the national guard to drive trucks I don’t see what the government is going to do to help out. With that said, how many of the qualified national guard that can drive trucks already do so in civilian life? Making calling them up for service a zero sum game.
Joseph Pino
Joseph Pino Oct 13, 2021 5:21PM ET
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this will do nothing. too little too late. they are in way over their heads.
Connecticut Yankee
A_Jaundiced_Eye Oct 13, 2021 12:24PM ET
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a "bottleneck" czar ?  Too funny !!!  Only the Liberals could come up with something so ridiculous.
Felipe Daniel
Felipe Daniel Oct 13, 2021 9:12AM ET
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Joe Biden Brandon America’s worst president
Connecticut Yankee
A_Jaundiced_Eye Oct 13, 2021 8:58AM ET
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They didn't put in the quote from the picture, which was Joey saying "And this is my right hand.  And the other one is my left hand. Right ?"
 
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