USMX Animated PDFs

ii 2 0 1 5 A N N U A L R E P O R T CHAIRMAN & CEO'S 2015 MESSAGE "May you live in interesting times..." -- Chinese curse WELCOME Hello, and welcome to the 2015 USMX Annual Report! I hope you enjoy our year-end review of the topics and the issues most critical to our carrier members, our port as- sociation members and our direct employer members. As you peruse the report, you'll note that our efforts in 2015 really comprised three major components: ONGOING ADMINISTRATION OF THE 2012-2018 ILA- USMX MASTER CONTRACT As we entered 2015, we had successfully implemented the most critical components of the 2012-2018 collec- tive bargaining agreement, but we still had lots of work to do on various important pieces of the Master Contract. We continued to have dialogue around areas of the con- tract such as chassis maintenance jurisdiction, chassis pools, and the imple- mentation of new technology. Chassis: The parties put significant efforts into the creation of a "gray pool" chassis concept in 2015. Initially, the focus was directed primarily to the New York/New Jersey area, as that was deemed the area of critical need; but, the parties also agreed that a successful program would likely pay dividends up and down the East and Gulf coasts. Unfortunately, the year ended without a successful conclusion to all of the hard work and will have to be carried into 2016. Container Royalty Central Collection (CRCC): This component of the new Master Contract was essentially completed by the end of 2015, and while it was a gargantuan effort, it has also been a huge success. The CRCC Team has basically reinvented a more than 50-year-old process, while implementing new tools and procedures that will improve carrier and fund manager productivity significantly, allowing them to meet the needs of growth within the industry for many years to come. The new collection process will undoubtedly serve the ILA, the local ports and our USMX members well for another 50+ years. Technology: As we began bargaining for the 2012-2018 agreement, it was obvious that promoting the implementation of technology while protecting the workforce was a top priority for the industry. We saw several success- ful technological implementations in 2015 that resulted in proving out the efforts of our joint bargaining committees in negotiations. We are confident that we have a sturdy framework and a process that will serve the industry well as we move into the future. ABSORBING THE IMPACT EFFECT OF CONTENTIOUS WEST COAST BARGAINING As West coast bargaining between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU) dragged on through the latter parts of 2014 and into 2015, the impact of the contentious negotia- tions pushed significant cargoes to the U.S. East and Gulf coast ports. In 2015, East and Gulf coast ports gained the top nine spots in U.S. port growth with growth rates ranging from 9.5% to 23%. These numbers are stunning. Although there certainly were times when the seams started to creak in places, all of the ports authorities, port associations, the carriers calling them, the stevedores, the ILA labor actually handling the cargo, the truckers, and all of the stakehold- ers whose participation was vital to this success should be proud of what was accomplished. These efforts will serve the U.S. East and Gulf ports well as we head into 2016! NEGOTIATING A SUCCESSOR AGREEMENT TO CURRENT MASTER CONTRACT While the West coast ILWU-PMA bargaining dragged on in 2015, it became more and more apparent that the bargaining process adhered to by our industry for the last 50 years may not be the best process to use going forward. With three-plus years left on the 2012-2018 ILA-USMX Master Contract, USMX and the ILA began discussions about a possible long-term Master Contract exten- sion agreement. Those discussions proved to be very productive and will con- tinue on into 2016. At this point, we continue to leave all options for an exten- sion and/or an early settlement of a new agreement on the table. I am confident that the parties will continue to be committed to reaching a productive and success- ful resolution to these efforts. Other critical industry areas of attention for 2015 and beyond include: SAFETY Employee safety continues to be a major area of focus for USMX and the industry. The USMX priority in this area is to develop more rigorous industry metrics by which our members can more accurately and precisely measure and compare their progress against the industry as a whole. In 2015, we were able to build on our 2014 successes in this area and are seeing positive results. The efforts of the ILA-USMX Joint Safety Committee, facilitated by interna- tionally-renowned safety expert Ron Signorino of The BlueOceana Co., should be lauded for its nonstop efforts on behalf of the maritime industry. The committee, implemented in 2012, continues working with safety personnel in our ports and on a local, state and national level and is making important David F. Adam Chairman & CEO

• Cover