US truckers, shippers frustrated with chassis splits, shortages

US truckers, shippers frustrated with chassis splits, shortages

BSF Logistics Park, Chicago, Illinois, United States.

At BNSF Logistics Park Chicago, chassis tend to be available at the beginning of the week, but a source told JOC.com that 20-foot chassis are hard to find by the end of the week. Photo credit: Ari Ashe.

With time even more precious for truck drivers due to new US rules, truckers are becoming increasingly frustrated with the daily struggle to find chassis, spelling potential delays for shippers’ customers.

Time is a precious commodity now that electronic logging devices (ELDs) strictly monitor the 660 minutes a driver can be behind the wheel. Every minute counts, so truckers are becoming increasingly frustrated with the daily struggle to find chassis and worried about how this hurts their ability to quickly serve shippers.

Shippers who respect the clock become shippers of choice. Ports that offer short turn times have a good reputation. But some of the biggest waste is on the last mile. Even though it's the final step in a long journey, scrambling to find a chassis for the box can easily throw off delivery schedules and the driver’s clock.

The chassis problem was acute when Canadian National Railway, CSX Transportation, Union Pacific Railroad, and Norfolk Southern Railway struggled with problems in Chicago that ground the flow of equipment to a near halt. The rail delays eased as the weather warmed, but that’s also when strict enforcement of the ELD mandate began. Meanwhile, the truckers working on a fixed clock had more containers to move each day.

In the first quarter, 20-foot container volumes grew 4.5 percent and 40-foot containers rose 8.2 percent. In April, international intermodal traffic as a whole grew 5.2 percent and the average moves per workday rose 2.7 percent, according to the Intermodal Association of North America and Gross Transportation Consulting. The numbers are expected to continue in this direction with a capacity crunch in the trucking industry pushing freight to the rails.

All the numbers underline a central theme: truckers must move more freight and do so in less time if they were cheating on paper logs.

Chassis splits — when a trucker is diverted to a second location for a chassis — wastes minutes, and time equals money. The strategy for many truckers: showing up and pressing their luck. When there are none available, deliveries are thrown off schedule and shippers also may incur accessorial fees. Chassis splits have a negative effect on morale too, at a time when the industry is already facing a driver shortage.

It’s unclear how often a driver finds no roadable chassis in a rail terminal. Trucking companies say this happens weekly in Chicago and Memphis, Tennessee. Chassis providers admit the splits do happen but not as frequently as truckers contend.

One source, familiar with operations in BNSF Railway’s Logistics Park Chicago terminal, said there are usually no 20-foot chassis by end of the week, although there are enough 40-foot chassis. The source spoke on the condition of anonymity because the individual was not authorized to comment on yard operations.

Chassis shortages in Memphis

Chassis splits can happen in any type of terminal operation, but this guessing game is most common at a grounded facility — where a trucker is required to pick up a chassis beforehand. At a wheeled terminal — where yard workers mount the container before the trucker arrives — there is more predictability, but it’s not uncommon that the wrong chassis will be used and the driver will have to pay a flip charge to the terminal operator.

The ocean carriers instruct the railroads on which chassis to use, even if the container is under a merchant haulage contract, so any mistake in the mounting prevents the trucker from leaving the terminal.

Donna Lemm, executive vice president with IMC Companies, shared a story with JOC.com about a recent experience in Memphis, Tennessee. An IMC driver visited the BNSF terminal on Lamar Avenue to grab a container under a store-door contract.

Lemm watched in the passenger’s seat to view the situation with her own eyes.

“Our driver got a list of the available chassis from BN. I said, ‘But there are only 10 chassis. Every driver who comes in gets this same list? There are going to be hundreds of boxes picked up today and there are only 10?’ He said, ‘This is the list for the day. If the chassis we need isn’t on the list, then we’re going to have to search for one. Sometimes it takes minutes, sometimes it takes hours’,” Lemm told JOC.com.

On this day, it took about 40 minutes.

“I saw hundreds of chassis, but our driver says we couldn’t use those. I said, ‘Are you serious? It says [ABC] chassis ... stenciled in there,” said Lemm, who declined to mention the specific company tied to this particular haul.

The driver told her that the chassis was part of the Mid-South Chassis Consolidated Pool, operated by Consolidated Chassis Management (CCM), and the door contract required him to use a chassis from the provider’s exclusive pool and not from the cooperative pool, even if it bore the company’s logo.

TRAC Intermodal CEO Keith Lovetro said the contracts with the ocean carriers may include clauses that require truckers to use the company’s own pool.

“The steamship line who has negotiated a contract with TRAC has agreed to a per diem rate and that is based on the pool they are utilizing. For example, in Memphis, we run a TRAC pool and then we contribute to the CCM pool. If we have assets devoted to the TRAC pool for the steamship line for an agreed upon rate, that’s the asset the motor carrier needs to use,” he told JOC.

In other words, the chassis provider offers a bargain to the ocean carrier in exchange for a clause requiring the trucker to use the provider’s proprietary pool.

None of this is new, per se, but time matters with the ELD mandate, and driver retention is critical as motor carriers are scrambling to recruit new drivers to handle all the demand from shippers in a timely fashion.

“This driver of ours has a wife and two kids. How does he get to see them when he’s handcuffed by the warehouse delays and can spend up to three hours to find a chassis? None of this is OK,” Lemm said.

Chicago chassis splits common too

With nearly a quarter of all rail traffic and nearly half of all intermodal traffic going through Chicago, it’s easy to understand why chassis splits happen in this city too.

NS, CP, and BNSF ground some or all of their containers in Chicago.

“We’ll go to Logistics Park Chicago thinking we will be able to find equipment and there’s none there. That’s why we began telling shippers that we are giving them 90 minutes of free time, but if we are not out within that time because of the chassis situation, you’re paying $65 per hour. And you know what? Shippers are not balking because there is such an extreme shortage,” said Steven Teune, operations manager with Acme Transportation.

One Midwest shipper, who spoke on the condition of anonymity, said the chassis problems trickle down the supply chain.

“One of our truckers advised us that a provider showed 27 chassis on hand at one location in Chicago. The driver goes and finds 26 of them with maintenance tags on them so they cannot be used. The one chassis had a flat tire and the CY refused to fix it,” the shipper said. “These chassis splits are adding huge costs to shippers when these fees can’t be budgeted correctly — cause you have no idea when or how much these will be.”

Who’s to blame? Teune said everyone points the finger at someone else.

“The chassis providers will say it’s because the railroads don’t know how to manage their inventory. The folks at the railroad will say it’s because the chassis providers aren’t giving us enough equipment. It’s a big circle and we’re stuck in the middle,” he said.

Lovetro said that part of the problem is that drivers are supposed to report problems with chassis but fail to do so on a regular basis.

“The motor carrier is supposed to declare any damage when returning the chassis. We get a very small number of declarations about the condition of the chassis and that is something the industry needs to improve upon,” he said.

The source familiar with BNSF Logistics Park Chicago said everyone carries some blame for the situation, including the problem of high turnover in the terminal staffing leading to inexperienced workers.

“Some of it is on the rail terminal staff not being that careful with chassis. Also drivers will use only the chassis brakes to stop and many times loaded containers are brought in with the chassis brakes smoking,” the source said. “I think there is also a hard time getting chassis mechanics. I don’t see as many in the yard as I used to.”

BNSF said there were no chassis deficits impacting door deliveries.

“Intermodal equipment providers that own those assets are actively adjusting to robust freight markets and driver shortages that are contributing to high street dwell and spot shortages,” BNSF spokesperson Jessa Lewis said Tuesday night. “There are no chassis deficits impacting door deliveries.”  

There is also a spillover because when one terminal runs out of chassis, truckers tend to pluck one from another railyard and exit without a container. TRAC and Direct ChassisLink, Inc. (DCLI) have cracked down on this practice by instructing rail terminal operators to prohibit truckers leaving a terminal with a bare chassis.

Chassis providers recommend communication

TRAC and DCLI provide chassis counts multiple times per day in the large markets. DCLI also posts the information on its website and refreshes the information twice a day.

Ron Joseph, DCLI’s chief operating officer, said that the counts will update when a trucker enters or leaves the railroad terminal through a gate. Lovetro outlined a very similar process in railyards and their own depots. Both providers send out staffers to visually inspect the chassis and remove the unusable units from the official tally.

“We reposition chassis into the terminal based on what’s being unloaded from the trains and our volume projections. So if we see we’re going to be short on a particular ramp based on the morning inventory and projections for the day, then we’ll reposition chassis into the ramp,” he said. “If we are running short, we also have yards near the ramps where we have chassis available and we’ll direct motor carriers to those locations.”

He acknowledges, however, there have been times in the last 12 months when a terminal ran out of chassis. During the height of the rail congestion this winter, DCLI and TRAC moved chassis into the Midwest after reports of widespread shortages. Joseph said that since June 2017 — when truckers began noticing a general shortage in Chicago — DCLI has moved 2,000 into the market and more will be coming.

He also encouraged truckers in Chicago, Memphis, or other cities to contact the market manager if they want an updated chassis tally. Better communication and information from all parties involved with the final mile is important, Joseph said.

“Call our market manager, call our local staff. They will help you find an available chassis,” he said.

Lovetro also suggested that motor carriers contact the local customer service staff or the pool manager before heading out to a rail terminal to get an updated chassis count, which gets updated every 15 minutes in an internal TRAC system.

“These are dynamic environments though. If I call at 8:00 a.m. and I don’t show up until 3:00 p.m., then the picture will be different. But if I call up at 2:30 p.m. and show up at 3:00 p.m. the likelihood is that if our pool manager said there were 100 chassis available, there are probably 95 still sitting there,” he said.

Contact Ari Ashe at ari.ashe@ihsmarkit.com and follow him on Twitter: @ariashe_joc.