Trucking and container chassis again moves into the spotlight. But now it’s how much to pay for the ground the chassis get stored on at the port. The dislocation caused by ocean lines trying to foist off chassis ownership on truckers continues to hurt US ports.
Chassis provision has played a key role in the port container supply chains since ocean lines divested in 2013. The issue was a key factor in the West Coast labor dispute at ports, and now is headed eastward.
The whole problem with pools, of chassis or otherwise, is how to allocate the burden of maintaining them, or, put another way, allocate the gains of pooling among the participants. Again it seems, truckers will not be benefiting; these players will fight over fees and split them while truckers will wind up paying in lease rates for whatever adjustments there are. The ILA is at least bringing attention to the problem.
Increasingly high rents charged to chassis providers by the Port Authority of New York and New Jersey could hurt the port’s overall competitiveness, says Dennis Daggett, executive vice president of the International Longshoremen’s Association.
Source: ILA concerned about NY/NJ chassis depot rents
Posted in Labor Economics, Logistics, Ports, Shipping, Supply Chains, Trucking
Tagged Chassis, container shipping, intermodal, labor economics, Logistics, ports, trucking
This interview with Ryan Peterson, CEO of Flexport, is fascinating. It is well worth registering at the Loadstar in case you don’t already have access.
Ryan points out that only 75% of freight bookings are kept. This may be a correlative of on time percentage of about the same amount for ocean carriers; but it is more symptomatic of a situation in which the uncertainty breeds more uncertainty. It’s like new product introductions; no one knows if your new product (disk drive, for example, in the business I was in years ago) is going to sell; it has plenty of promise, but also lots of competition. As a result your distributors (NVOCCS and freight forwarders) over-order, trying to convince you they can peddle lots of them, for fear that they will be cut out of the allocation when you start to deliver but can’t give them their whole order. In a sense, for an ocean alliance every voyage is like a new product launch. People over-order, they plan, but can’t full ships, so they cancel (or reroute, changing schedule). It’s a no-win for everyone.
Ryan is right in my view; data and sharing it can help. The issue is whether companies can be talked into sharing data. That’s what his firm is partially about– facilitating the exchange (for a price of course!). And for many firms, shippers and carriers, it should be worth it; a trusted intermediate can greatly reduce transaction costs.
Listen up– you’ll learn a lot!
Source: PODCAST: Behind the Flexport phenomenon; Ryan Petersen interviewed – The Loadstar
Posted in Logistics, Ports, Service Management, Shipping, Strategy, Supply Chains, Trucking
Tagged alliances, analytics, big ships, container shipping, innovation, Logistics, maritime, ocean shipping, ports, service, Software, supply chains, technology
The second State of Freight report is out. We should listen to it because one thing Trump expects to do is spend big money on, guess what, infrastructure construction projects. If he gets rid of EPA regulations, we can see these move forward quickly, for better or worse. Reports such as this will provide important input to the choice process.
The report comes a year after Congress made dedicated freight funding a priority, with almost $11 billion in funding for freight mobility in dedicated freight funds as part of the Fixing America’s Surface Transportation Act, the report also notes how states will have a key role in how the U.S. plans for freight movement and what projects will be completed.
Source: State of Freight II Report Takes Wide-Ranging View of U.S. Infrastructure’s Needs – Supply Chain 24/7
Here’s the actual report in PDF format: aapa_state_of_freight_reportii