New Chassis Pool Announced for Three Southeastern Ports
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Three Southeastern ports and the Ocean Carrier Equipment Management Association announced on Feb. 28 they have signed a memorandum of understanding to reconfigure their existing truck chassis pool beginning in October 2023.
The new pool will be called South Atlantic Chassis Pool (SACP) 3.0.
The port authorities entering the deal are the Georgia Ports Authority, which runs the Port of Savannah, the North Carolina State Ports Authority, which operates the Port of Wilmington, and the Jacksonville (Fla.) Port Authority, which operates the Port of Jacksonville.
"SACP will continue to leverage its proven technology and management expertise to drive innovative chassis provisioning options that address changing customer and market needs as well as business demand," said CCM CEO.
Continue reading at https://t.co/cQi0ApAVCH#supplychains pic.twitter.com/xfd6sMphqa — CCM Pool (@CcmPool) February 28, 2022
Not included in the agreement is the Port of Charleston, which had already announced it was leaving the existing chassis pool and would start its own operation to provide newer chassis, also beginning in 2023.
The single-provider pool model aims to supply 60,000 chassis at the three facilities to truckers, beneficial cargo owners, ocean carriers and other port users.
“Chassis are a vital link in the supply chain and we are committed to ensuring our customers continue to have access to a modern and dependable chassis supply,” Port of Jacksonville CEO Eric Green said in a statement. “The enhanced SACP 3.0 is responsive to swings in chassis demand, providing cargo customers throughout the Southeast with a reliable chassis supply to meet their evolving needs.”
For the past several years, as cargo volumes have surged at ports on the Atlantic and Pacific coasts, the availability and quality of chassis has been an issue for port users. Many in the trucking industry, including American Trucking Associations’ Intermodal Motor Carriers Conference, have urged port operators to increase the number of available chassis and also significantly upgrade their chassis fleets and provide them with units that have updated safety features, including anti-lock brakes, steel-belted tires and LED lighting.
Port leaders said this new agreement will begin to address some of those concerns.
The new agreement specifies that the SACP will begin to transition away from its current multi-contributor pool to a single provider over the next 18 months. The agreement also says the pool will continue to be owned by a subsidiary of OCEMA and managed by Consolidated Chassis Management.
Chassis by John Sommers II for Transport Topics
“This joint effort by three major U.S. ports and ocean carrier partners is a great example of a public-private effort that will ensure port users, including U.S. exporters and importers, truckers, railroads and ocean carriers, as well as the ports themselves, will receive access to the most resilient, efficient and environmentally sound regional chassis fleet in the U.S.,” said Jeffrey Lawrence, OCEMA executive director.
As far as chassis rates go, they will be made available to pool users through a publicly available tariff.
The leadership of the North American Chassis Pool Cooperative wants to see how the new chassis are priced before he’s convinced this is a good deal for the trucking industry.
“It all depends on the pricing structure,” NACPC Chairman Dave Manning said. “All I can be is skeptical. They can prove me wrong that they can have fair pricing between motor carriers and ocean carriers and if they do that, this is a model that allows for the improvement in the quality of the chassis.”
The groups involved in the new deal indicated they plan to file in the near future with the Federal Maritime Commission, indicating how the new pool will operate.
Under the current arrangement at the ports, chassis providers such as NACPC, DCLI and Trac Intermodal, provide chassis to the SACP. Any container that is at a port can be put on any chassis, but the independent equipment provider-carrier agreements dictate where the revenue from the chassis rental is distributed.
With cargo surging at the ports, chassis have been in short supply, but recently NACPC and Stoughton Trailers have announced plans to significantly increase the number of chassis being manufactured to improve supply.
On Dec. 6, NACPC announced it had acquired Bridgman, Mich.-based chassis manufacturer Pratt Industries Intermodal Chassis from the Nashville, Tenn.-based private equity firm LFM Capital. NACPC plans to build up to 7,000 40-foot maritime chassis this year.
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Just a month later, Stoughton announced it will build intermodal chassis at a new facility set to open this year in Waco, Texas. Stoughton is also expanding production to manufacture as many as 25,000 chassis a year.
The rush to build more chassis comes after the U.S. Commerce Department and International Trade Commission determined last summer that the U.S. chassis industry was being “materially injured by reason of imports of chassis from China that are sold in the United States at less than fair value.”
Still pending, and unrelated to the Feb. 28 announcement, is the 2020 $1.8 billion lawsuit before the Federal Maritime Commission. The Intermodal Motor Carriers Conference filed the suit against OCEMA and 11 ocean carriers alleging that they violated the Shipping Act of 1984 by inflating intermodal chassis prices at dozens of ports.
