If a hard appointment time is required, it is best to pay for a *pre-pull service to guarantee the chassis and appointment time. This is nothing new, as the trucking industry has struggled with a shortfall of truck drivers for nearly a decade. Chassis availability is being constrained by congested freight networks and a lack of manufacturing capacity. All Rights Reserved. The result is that the shortage of chassis has become somewhat like a bank run, with everyone wanting to get their container out at the same time. Current and potential future shortages and/or distribution limitations of essential cargo-handling equipment, such as chassis and shipping containers, and how these challenges can be or are likely to be addressed by the freight and logistics industry over both the medium and longer term. Once its stateside, shippers will then figure out how to get it to its destination. We bring the news to you. Tri-axle chassis is more expensive than normal chassis. Balancing Port Driver Shortages and New Drivers. Why There is a Chassis Shortage at the Ports of Los Angeles For the past couple of weeks, nearly close to a month, the Ports of Los Angeles and Long Beach have been experiencing a significant chassis shortage problem. POPULAR ARTICLES ON: International Law from Worldwide. Inefficiencies at marine terminals are causing shortages of chassis the trailers that transport shipping containers. Chassis safety andmaintenanceare regulated by something called the Roadability Rule, which is enforced by the Federal Motor Carrier Safety Administration (FMCSA). Drayage providers in the area have even started to get in touch with each other in search of capacity. The result: Fewer chassis to go around and a higher demand is increasing daily rental fees. (Drivers are verified at terminal entrances automatically.). That increase reflects two issues: the strain on terminal operations struggling to process extraordinarily high freight volumes, and the trucking chassis shortage complicating hauling operations. Right now, the shortage seems to be a constant. process generally works. Copyright 2023, All Rights Reserved, FreightWaves, Inc, Chassis, containers and draymen all stars of the intermodal service meltdown, Loaded & Rolling (Enterprise Fleet News/Analysis). We all realize and understand the reasons for the chassis shortages: unprecedented increased national demand; increased chassis dwell on the street as customer warehouses reach capacity or near capacity; labor shortages on repairing equipment; and new duties on chassis manufactured in China. Initially, its not expected that this problem would be extremely long-lasting as the inbound container surge slows down, improvement in street dwell times and chassis availability is anticipated. onto the chassis, and the trucker drives it to a warehouse or a To combat this, a significant boost in available labor and yard space is needed. In May, fears of product dumping led the US Department of Commerce to impose a 221.37% fiscal duty on imported Chinese chassis on top of the 25% tariffs that the Trump administration levied on various Chinese products in an effort to "enable US producers to once again compete in a fairly traded market." var gptSlot = googletag.defineSlot('/21776187881/FW-Responsive-Main_Content-Slot1', [[728, 90], [468, 60], [300, 100], [320, 50]], 'div-gpt-ad-b1-i-fw-ad-1').defineSizeMapping(gptSizeMaps.banner1).setCollapseEmptyDiv(true).addService(googletag.pubads()); Right now, the shortage seems to be a constant. However, its going to take some agility on the part of supply chain managers and operators. Additionally, a larger supply of chassis could be introduced if the problem becomes persistent. will order more chassis to increase the chassis pool over Now lets look at this from a drivers perspective. Growing demand for domestic containers leaves shortage of 53-foot chassis Stoughton expanding chassis production to Texas Steady improvement forecast for US chassis market: IEPs US trailer demand defies economic downturn Railroads, IEPs to add 10,000 chassis in 2022 Trucking Logistics Trucking Equipment and a long-term structural problem by This will intensify further during peak season. The containers are stacked on top of each other to maximize space on vessels and trains. The only answers are to increase fees, which will impact consumers, or find new solutions. *What is a pre-pull? In the past, chassis shortages used to be seasonal, but we have not seen a seasonal shortage in the past 3-4 years. 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Mike Baudendistel is an analyst and Market Expert at FreightWaves focusing on the railroad, intermodal and transportation equipment industries. A new chassis costs in the range A shortage of truck chassis is exacerbating the supply chain crisis. A well-meaning packer earning close to minimum wage abroad is bracing your merchandise in a shipping container with wood that he is cutting to length. When it works, the flow of containers through our supply chain barriers restricting which chassis can be used at a port, and Find out what is actually important from the decision makers in your organization. The solution comes down to simple economics; the industry needs more drivers. Strengthening the Supply Chain in 2023: Is Sustainability a Solution to Disruption? congestion from too much volume. plague our supply chain and find ways to balance resilience with WebWhen a terminal has a shortage of chassis, truckers are burdened with a delayed turn time. As the supply pool of materials for new chassis shrinks, naturally, the market moves toward acquiring used vehicles to perform the many services required by construction, utility, and other work retailer chooses to store goods in a container in the parking lot Service providers can only move forward with the information you give and we all know what assumptions do. The ultimate solution to the issue is to better coordinate terminal and trucker operations so that truckers can return the empty containers and chassis to the ports and pick up and import load in a single trip. bigger cost. Many shippers have been caught unaware by the supplemental fees and have not budgeted for it in their transportation costs. (Loop has capacity of its own.) Valuations of Used Trucks Soar. In the past, chassis shortages used to be seasonal, but we have not seen a seasonal shortage in the past 3-4 years. He has 14 years of experience following the freight transportation industry with experience that also touched the truckload, Jones Act barge and domestic logistics industries. Tariffs implemented under the Trump administration remain in effect, including duties of nearly 200% imposed on chassis amid accusations of market manipulation by chassis manufacturers like China Intermodal Marine Containers. At the same time, U.S. warehouses and shipping yards operated under crushing pressure to manage the heavy influx of cargo brought on by the pandemic. A few of the common concerns involve: Smaller trucking companies are taking big hits. Each move could require a new chassis and additional chassis repositions. Mondaq uses cookies on this website. These include the following: With the shortage of chassis, drayage drivers must constantly check on the dwindling availability of them at the origin rail facilities where the container is located. In short, to transport the container over the road. The result is that the motor carrier cannot pull the necessary containers out during the free time so demurrage begins to accrue at an accelerated rate. Because of this, serious bottlenecks are causing container dwell times to increase at the ports. The client will still have to pay storage charges at the truckers own yard, but they will be a fraction of the cost of the railyard storage fees. A few of the common concerns involve: Smaller trucking companies are taking big hits. After his graduation in 2014, he started working as an operation specialist and worked his way up to becoming an Operations Manager. chassis out there; Broaden chassis pooling arrangements to eliminate artificial In addition, some carriers are wary of taking on too much financial liability with new equipment that could one day sit dormant. The basic laws of supply and demand apply. His attention to detail ensures that our customers are well-informed and left with no questions. What has been working in the past may not be what will work in the future, It is important to share as much information as possible from the very beginning of the shipment. We need this to enable us to match you with other users from the same organisation. Balancing Port Driver Shortages and New Drivers. MoreThanShipping.com is one of the world's leading shipping, logistics, transportation, cargo, and business blogs with an annual readership over 2MM people in 190 countries. This applies to all ports, but is especially the case when transiting traditionally congested ports on the East Coast, West Coast and Midwest. According to a 2022 report from Repairer Driven News, The biggest remaining issue is fluctuation in volume that truck drivers cant match. 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