Category Archives: Trucking

Truckers seek $1.8B from ocean carriers for alleged chassis overcharges

Once again intermodal container chassis become a bone of contention.Ocean carriers brought this on themselves by trying to escape liability for accidents caused by defective chassis. They created a system in which they could retain shadow control over chassis availability while not appearing as the responsible party.

The problem today, with declining intermodal shipping, is with the chassis pools created to give cargo owners a place to obtain a chassis when a shipment needs one. The pools were supposed to provide maintenance services on the units to assure they would be in good repair when they were picked up, reducing the chance of accident. However, there have been many trucker problems with the nature of the chassis use agreements; where they must be dropped off, and when. The words in the story are “denying truckers choice of equipment providers at ports and inland locations”.

I don’t think they will win on that claim. But it’s quite possible that there have been undercharges to ocean carriers and overcharges to truyckers. And since OCEMA, the chassis pool operator, was founded by ocean carriers, it’s probable the charges were arranged in carriers’ favor whenever possible.

There’s no question the truckers, who are on the low end of the totem pole, bear the brunt of the problems. And they have very few ways to try to right things. This is one attempt. There will be more until treatment of truckers is economically fair to them. It may never happen.

Chris Gillis Thursday, August 20, 2020

https://www.freightwaves.com/news/truckers-seek-18b-from-ocean-carriers-for-alleged-chassis-overcharges

Thanks to my good friend Chris Clott, ABS Professor of Logistics and Supply Chain at SUNY Maritime, I’m posting a copy of the complaint.

‘Data sharing is nice, but cooperation is key’ to ending congestion

The speaker, Stefan Pieters of Jan de Rijk, was speaking of the relation between road hauliers and airport stakeholders. I believe most hauliers at ports, warehouses, inland terminals, and any cargo transfer points would be saying the same thing. And so far there has been little effort on this score.

Truckers are the low person on the pole, and are not connected to the facilities they must rely on for service. They have no leverage. So their problems go ignored.

There is a lot of money to be made by coordinating this aspect of the trucking business, if anyone will step up and do it.

And as the interview claims, data takes you only so far. There has to be a willingness to act and change procedures, rather than just send data. Facilities don’t want to recognize that; it requires workers with the power to make decisions on behalf of the cargo owner, and that would erode ‘profits’, meaning costs. You’d have to pay workers more for the ability to make decisions.

It makes a stronger case for end-to-end coordination by the same vendor, such as Amazon or Wal-Mart. But truckers would still often be left out.

By Alex Lennane 13/07/2020

‘Data sharing is nice, but cooperation is key’ to ending congestion, says Jan de Rijk – The Loadstar
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TMC20: Michelin digital platform for trailer repair

This nice news release from Michelin showcases a new chassis repair program from Michelin.  Chassis repair has been an issue for years.  when chassis are rented there is no motivation to repair them.  The ocean carriers used to own a lot of chassis, to help get their intermodal containers on the road. But when owners of chassis became liable for damages caused by accidents from poorly repaired trailers, the ocean carriers sold them all.  Temporarily a few years ago, truckers were scrambling to find chassis.

Since then chassis ‘gray pools’ have been created at ports.  Truckers could pick up a proper chassis there, then return it when the trip was done.  Presumably maintenance of the trailers was to be done in the gray pool yards, while the trailers waited for a user.  But even that proved problematic. Unions associated with the ports wanted to be sure they did not lose jobs to outside, nonunion firms.  Ports in the Los Angeles area had work stoppages and court actions over this problem.  Other players in the gray pools were trailer leasing companies.

In Europe, chassis are owned by trucking companies, so there’s no question of who’s liable, both for accident damages and for repairs. There most truckers are employees of the trucking firms. In the US, most truckers, particularly in port drayage, are owner-operators, not employees, and so are only paid for the actual haulage they do. Here in the US, trucking firms won’t put up the capital to own too many chassis; they are already operating with low margins, and they haven’t had to before.

Chris and I have been writing about intermodal chassis for a number of years (An example) , and it is still a topic worth reviewing.  As one editor mentioned to us, intermodal chassis are “the gift that keeps on giving” for academics.  The current decline in imports via container on the West Coast of the US makes it a bit less interesting right now, because no one is having trouble finding chassis.

But keeping them in repair and road-worthy is a good place to cheat.  When a chassis breaks down on the road, the driver has no recourse but to fix it.  She is then paying for maintenance that should have been handled on the chassis pool yard. And it’s not economical for semi owners to also own a chassis unless they are committing to always do that kind of load handling.

In the chassis pools, it’s easy for a trucker to drop a marginal chassis, about to need repair; for instance a new tire set.   And it’s easy for the yard crew to send out a bad chassis because of an improperly performed inspection. But that is much less likely when the chassis are not needed instantly, as they were back a few years, and when there’s a highly qualified maintenance crew on duty.

I think it’s a great idea for Michelin to provide this service.  With the online tracking and dispatching, records are kept; the truck operator is assured that the unit is repaired to the TMC standard; and the records are electronically available, preventing issues over paperwork.  It should be a win if it isn’t too expensive relative to repairing in the yard.

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