March start-up planned for 'gray' chassis pool in LA/Long Beach
Flexi-Van executive says "misplaced" chassis have aggravated congestion.
Companies forming a gray chassis pool in the Ports of Los Angeles and Long Beach are planning a March 1 launch date.
Phil Connors, executive vice president of Flexi-Van Leasing, told members of the American Apparel and Footwear Association on Wednesday that the companies that contribute chassis to one of several chassis pools in the Southern California region such as Flexi-Van, TRAC Intermodal, Direct ChassisLink and other companies like China Shipping will begin exchanging information with each other next week about the approximately 80,000 chassis that will be in a so-called “pool of pools.”
Then starting March 1, drayage companies that lease a chassis from one pool such as Los Angeles Basin Pool, which Flexi-Van manages, can return chassis to marine terminals that formerly accepted only Grand Alliance Chassis Pool equipment, for example.
Connors said companies will be able to lease or return chassis at a wide variety of locations at both container terminals in the port as well as railroad terminals.
He believes congestion at ports such as Los Angeles and Long Beach, New York/New Jersey and Hampton Roads has resulted from a variety of “systemic” issues including larger ships, the large “dumps” of containers at marine terminals, alliances calling at different terminals, the lack of truck power to get chassis where they need to be and a lack of productivity at terminals.
Connors said that while many beneficial cargo owners and others said there was a shortage of chassis in Southern California, he believes there were enough, but they were misplaced, with many of them sitting in marine terminals.
He noted that the companies that were members of the LABP contributed over 3,000 chassis in a period of 6-8 weeks. “What we saw taking place, was on any given day in the fourth quarter of 2014 there were 5,800 in marine terminals that had not seen the light of day for 15 days or greater.” He said there were 3,000 containers in terminals for 15 to 59 days and 2,759 were in terminals for more than 60 days.
“That was the equivalent of 19.3 percent of the entire inventory chassis fleet. Why weren't they moving?” he asked.
While some were damaged, he said, for example, one terminal operator, which said it had 400 damaged or “out of service” chassis, had a total of 1,500 chassis that had not moved in 60 days.
“What’s happening here? I don’t have all the answers, but we saw more chassis went in, and productivity continued to dwindle, and good chassis got stacked with out-of-service chassis, and people said ‘give me more chassis, give me more chassis.’ That is not a sustainable process.
“If we don’t get a fundamental issue like that resolved, I hate to tell you ladies and gentlemen, you will see a repeat in 2015 of what you saw in 2014. There are fundamental issues that have to be tackled," Connors said.
He also said chassis were spending more time out on the street. In October 2014, for example, the on-street dwell time for chassis was 25 percent longer than it was in October 2013.
Earlier this week, the Pacific Maritime Association said it had reached a “tentative agreement was reached on the chassis topic” with the International Longshore and Warehouse Union during contract talks.
But despite the thousands of containers it has in the area, Connors said he did not know details of the agreement. “It’s interesting that people are at the negotiation table negotiating my assets,” said Connors.