The Massachusetts Port Authority plans to lay off about 25 workers at Conley Terminal following a decision by the Port of Boston’s biggest customer to suspend a route that moves cargo between Southeast Asia and the East Coast.
In two phases of layoffs starting Monday, about 20 of the 90 longshoremen and clerks who regularly work at the port will lose their jobs, along with up to five of 30 Massport employees. In addition, five open Massport positions will not be filled.
The suspended service by the China Ocean Shipping Co., known as COSCO, and its partners means the Port of Boston will lose about 1,000 containers a week being transported through the Suez Canal in Egypt. The route accounts for more than a third of the cargo business at Conley.
The shipping consortium, which started the Boston-Suez Canal route in May, is also eliminating its Suez Canal ports of call in New York and Norfolk, Va. The reduction is a result of a global slowdown caused by a decrease in consumer demand, industry officials say.
“COSCO’s business, like everyone’s business, to be honest, is off,’’ said company spokesman Gene Hartigan, noting that ports across the country have been affected by the economic downturn.
The China Ocean Shipping Co. will continue its service between Boston and the Panama Canal.
The layoffs are necessary to balance the loss of revenues at the port as fewer ships come in, said David Mackey, interim chief executive of Massport.
“We have a significant need to get our costs in line given that we don’t have the business at the terminal to support the labor that’s there now,’’ Mackey said.
The cargo business at Conley Terminal has never been a money-making operation, Massport officials said, and is subsidized by the port authority. In the past, Massport used toll revenues from its operation of the Tobin Bridge to buffer the losses at Conley Terminal, but with the bridge now under the state Department of Transportation’s authority, Massport no longer has access to those funds.
Last year, Conley Terminal sustained a $6 million operating loss, and the elimination of the Suez Canal service would mean a $12 million loss this year if current worker levels - and union wage increases - are maintained, Massport officials said.
Wages for the longshoremen and clerks at the terminal, who belong to the International Longshoremen’s Association, are expected to go up 14 percent on average this year.
The longshoremen’s union declined to comment.
Labor is the biggest cost at Conley, and Massport expects the layoffs and hiring freeze to save about $4 million.
“It’s in everybody’s interest that the port be viable economically,’’ Mackey said.