Biden enlists Target, Walmart to fix bottlenecks threatening holiday sales

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Stock Markets3 hours ago (Oct 13, 2021 09: 40PM ET)

(c) 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 and Steve Holland

WASHINGTON – President Joe Biden called on the private sector to ease supply chain congestions that threaten to disrupt the U.S holiday season. The White House announced Wednesday that it plans to overhaul the clogged system nationwide.

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:), Target (NYSE:) and other big retailers would also expand their overnight operations at the ports to try to meet delivery needs, Biden said. It is a “big step” towards reorganizing supply chains in America, which is the largest consumer market on the planet, Biden stated, adding that the government would also be involved.

“If federal support is required, I’ll direct any appropriate action, while if the private industry doesn’t step in, we’ll call them out to ask them to act,” said the president during remarks at the White House.

The larger goal is to fix long-standing problems in the U.S. supply chains, he stated. The stop-and-start nature caused by the pandemic has made it difficult to optimize global supply chains for quick goods movements.

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 Partly the problem is a shortage of truck drivers and warehouse workers to pick up goods.

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 survey shows that the economy remains the top issue for both Democrats and Republicans.

White House officials have said that Americans may face higher prices and some empty shelves this Christmas season due the supply chain problem. Jen Psaki, spokesperson for the White House, told reporters that Biden cannot guarantee no holiday disruptions.

“What we can do to reduce delays is use every lever of the federal government level,” she stated when she was asked about mobilizing National Guard troops or other troops.


In addition to the increased port activity, the three largest carriers of goods, Walmart, FedEx (NYSE) and UPS, plan to increase their 24-hour operations to speed up the delivery of goods throughout the country.

Samsung (KS:), Home Depot (NYSE:) 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 to executives from the two ports, as well as the International Longshore and Warehouse Union and the Teamsters. Some CEOs who are scheduled to attend said they work 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 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 asked the White House for a supply chain warroom and brought in experts from both government and private sectors to quickly identify issues.

” We cannot ignore the warning signs of higher prices, and reduced availability,” stated Geoff Freeman, the CEO of the trade group.

The White House has been working to reduce inflation-inducing supply shortages in everything, from meat to semiconductors. In June, the White House created a task force that meets every week and named John Porcari a “bottleneck” coordinator to encourage private-sector businesses to find ways to move goods.

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