Drayage companies in the Port of New York and New Jersey are asking container lines to waive per-diem charges for late return of containers and chassis to congested terminals, and are threatening to challenge per-diem bills caused by the terminals’ delays.
The Association of Bi-State Motor Carriers’ attorney sent letters to ocean carriers asking them to waive per-diems for several weeks during June and July when congestion made it difficult or impossible to return equipment on time.
“If this issue cannot be resolved amicably, member trucking companies will have no alternative but to invoke the force majeure clause of the UIIA and refuse any per-diem charges relating to the substantially reduced levels of service at marine terminals in the port,” the letter warned.
Jeff Bader, president of the Bi-State Association and of Golden Carriers, said the only positive response so far to the July 30 letter has been from NYK Line, which said it would consider waiving charges for truckers that can document that terminals’ poor service prevented on-time returns.
Individual drayage companies also have requested per-diem waivers. Michael Lombardi, sales and marketing manager at AZ Container Freight Station, said “maybe 20 percent” of his company’s requests have gotten results.
Truckers have won case-by-case exemptions of free-time storage of containers delayed by congestion. That has mitigated demurrage charges.
Motor carriers have had less luck persuading terminals to pay additional detention payments for drivers’ waiting time. Maher Terminals supplemented detention payments when its gates were congested earlier this summer, but other terminals have been sticking to the terms of their tariffs.
Those tariffs require detention payments for trucks that aren’t handled within a specified time, but those charges cover only the time that trucks spend inside terminal gates. On some days at some terminals, drivers have waited as long as several hours on streets outside terminals.
This summer’s congestion at New York-New Jersey started with computer problems at Maher and spread port-wide as ships were rerouted to other terminals, which were dealing with annual vacation-season shortages of International Longshoremen’s Association labor.
The New York Shipping Association said the number of ILA workers on the job was the same as last year but that they’re handling fewer containers. Productivity declines have been blamed on terminals’ construction, system process changes, and volume spikes, in addition to labor shortages.
The NYSA has said it plans to seek Waterfront Commission authority to expand the port’s workforce beyond replacement of 300 ILA members taking early retirement under the union’s new contract. Recruiting, hiring and training the new workers will take several months.
Terminal officials say they expect delays to abate when the workforce returns to full strength during September.
Speaking at the Bi-State group’s monthly meeting, Bader said this summer’s delays have been “a nightmare,” but that he was “disappointed” with Hapag-Lloyd’s recommendation last month that cargo interests use alternative ports until New York-New Jersey gets back to normal.
Bader noted that Bi-State representatives have been meeting with officials of terminals, the New York Shipping Association and the Port Authority of New York and New Jersey to address the port’s problems.
“It is very, very important that we all were in the same room, hering the same story, and the same complaints at the same time,” said Tom Heimgartner, president of Best Transportation and a Bi-State board member.