The implementation of a planned universal pool of interchangeable chassis at the Port of New York and New Jersey is making progress, according to the Journal of Commerce.
Although there is no date yet for when planned port-wide “gray” pool might be launched, Keith Lovetro, CEO of TRAC Intermodal, which controls two-thirds of the port’s approximately 30,000 chassis, said it could begin operation in the first quarter of 2016.
Improvements in chassis supply and quality are crucial to smooth port operations. Problems with chassis have been a key contributor to congestion that has plagued New York-New Jersey and other ports, including Los Angeles-Long Beach.
During the last five years, container lines have sold most of their chassis to leasing companies. The carriers did so in order to cut costs and bring their U.S. operations in line with other nations, where truckers or shippers supply their own equipment. The adjustment has been bumpy for ports and their customers.
In New York-New Jersey, the three main lessors —TRAC, Direct ChassisLink Inc. and Flexi-Van Leasing — operate independent pools that don’t share equipment. Truckers often must make an extra stop to switch chassis between different customers’ loads. These trips reduce drivers’ productivity and worsen congestion at terminal gates.
New York-New Jersey plans a centrally managed “market pool” cooperative. The lessors plan to form a joint venture that will hire a pool manager. The manager would run the pool according to guidelines set by industry groups that have been working on the gray pool. Lovetro said the arrangement provides safeguards to ensure that chassis supply and prices aren’t manipulated.
The pool’s operating rules will include targets on chassis utilization levels, out-of-service equipment and other performance metrics. The plan is to open at least two or possibly three near-dock chassis depots to improve M&R quality and to help balance flows of chassis among marine terminals and other locations.
Efforts to develop a market pool in New York-New Jersey have taken longer than expected that’s largely due to the large number of participants involved. The discussion has included representatives of lessors, terminals, M&R contractors, trucking companies, and longshore labor. At the moment agreement appears close on the two main unsettled issues — union jurisdiction over chassis maintenance and repair, and assurances that chassis providers can’t use the pool to manipulate supply and prices.
RCL Agencies will provide more information once available.