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Inventories delay effects of shutdown

Lithia Motors won't suffer for at least a month, says Chairman and CEO Sid DeBoer

Captains of industry, who planned for the possibility of labor trouble on West Coast docks, may have mitigated what could turn into awful economic news.

Everyone knew the previous contract was for five years, said Bill Thorndike president of Medford Fabrication and a member of the Port of Portland Commission. It isn't as though people woke up and there were discussions between the longshore union and stevedore companies.

Chief executives paying attention to the troubled harbor waters could at least take action for the short term. Nonetheless, the corked bottlenecks of commerce have anyone relying on shipped goods wondering about the weeks ahead. That goes for exporters as well as importers, who stock shelves and equipment bays.

Needless to say, when you turn that faucet off, it hurts, Thorndike said. Portland is the second-largest grain exporting port in the country, and it certainly has a ripple effect throughout the Northwest and Midwest.

Thorndike points out that the transportation system has superseded the role of the warehouse in the past dozen years.

The transportation system is used as our warehouse as we move more and more to 'just-in-time' inventories, Thorndike said.

The average Oregonian, unless they are specifically involved won't see any effect until inventories start to dry up, and that's real dependent on the type of products involved.

Thorndike said shippers have shifted their goods to Canadian ports ever since talks began dragging along during June and longshoremen began slowing their pace.

While retailers may feel a pinch sooner than others with massive shipments of Christmas items on the way, Lithia Motors Chairman and Chief Executive Officer Sid DeBoer said it would be at least a month before his business would suffer because of the lockout.

Most all of the manufacturers ship through East Coast ports, DeBoer said. Ultimately, it may affect the ability to build cars, because a lot of parts come from Japan. Right now we're in great shape. If they can't settle in 30 or 45 days, hopefully the president will step in. Somebody has to do some arm-twisting at some point.

Robert Carroll, of ChinaBridge Consulting Group in Ashland, said that based on 2001 figures there are &

36;100 billion in imports from China bound for this country. The top four categories are electronic machinery and equipment for power generation; apparel and footwear; iron and steel; and toys.

The question is how much has come in before this, Carroll said. I don't know how much is in the pipeline and how much has actually arrived. With the Christmas holidays coming up, most retailers have a sizable portion of their retail year coming up. It will have an impact if a significant amount of the inventory hasn't landed.

Reach reporter Greg Stiles at 776-4463 or e-mail