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68 Truck Drayage Productivity Guide Chassis Supply Solutions FMCSA Chassis Roadability Rules New chassis roadability rules promulgated by FMCSA1 took effect in 2010. The Final Rule on Chassis Roadability was published by FMCSA in December 2008. In summary, it calls for the following: Identification of a single Intermodal Equipment Provider (IEP) for each chassis (by December 2009), IEP establishment of inspection, maintenance, repair, and recordkeeping programs (by Decem- ber 2009), A standardized audit trail of driver Roadability Component Defect (RCD) reports, Driver Vehicle Inspection Reports (DVIR) and repair records, and USDOT number applied to all chassis (by December 2010). The key effect is to hold IEPs responsible for maintaining chassis to FMCSA standards, and to establish a corresponding audit trail. Ordinarily, there is no law against owning a defective or sub- standard chassis, but there are laws against operating unsafe equipment on public roads. The bur- den has thus previously been placed disproportionately on the drivers and motor carriers, who must either find a good chassis or wait to have one fixed. Too often, this situation led to drivers using substandard chassis rather than incurring the economic loss from delay. The standardized audit trail will help ensure that IEPs actually maintain chassis on schedule and repair defects noted by drivers. Drayage firms and drivers all have stories about defective equip- ment that was put back in service without repairs, defective chassis that clogged terminal parking areas for long periods, and drivers that were charged for preexisting damage. The primary impacts on port drayage should be as follows: Reduced frequency of trouble tickets and delays related to chassis defects; and Reduced chassis search time due to fewer, better chassis at the terminal. These results coincide with some of the chassis pool benefits. These benefits are not automatic; realizing them may require significant enforcement activity by FMCSA. The final rule provides for periodic "roadability reviews" by FMCSA with the possibility of civil penalties or removal of equipment from service for violations. The new roadability rules may create incentives for terminals to devise and implement a process for drivers to tag substandard chassis and for maintenance personnel to fix them. Under current practice, substandard chassis may sit in the parking area indefinitely, causing congestion and delay. Ocean carriers are usually reluctant to authorize repairs as long as records show there to be chassis on hand. The current de facto process is that a chassis is fixed only when a drayage driver decides it is the best one available and pulls it to a roadability canopy or other maintenance site. Near-Term Solutions: Neutral Chassis Pools Neutral chassis pools are an obvious near-term means of reducing chassis-related CY bottle- necks. The practice of chassis pooling is spreading at inland rail terminals as well as at marine con- tainer terminals. As described above, these are multiple pooling approaches. From the drayage perspective, the various options are all effective if they Improve the quality of chassis, reducing the need to search for a good unit or to have a sub-par unit fixed; 1 49 CFR Parts 385, 386, 390, et al., December 17, 2008.

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Container Chassis Supply Time and Delays 69 Eliminate the need for chassis flips due to mismatched container and chassis; and Reduce the need to reposition empty chassis. An EPA SmartWay publication2 notes the following: Common chassis pools can provide a more efficient management of terminal assets, increase the volume of goods through the port, and free-up space used to store chassis on port lands. Additional fuel savings from reducing miles traveled while switching chassis is dependent on the size of the port facility and its physical layout. Pooled chassis can also facilitate the implementation of virtual container yards (VCY) and empty container yards (ECY), reducing the number of empty container movements, congestion and wait times at terminal gates. Terminal Pools Terminal pools are often maintained at terminals operated by independent stevedores (such as SSA) that have multiple client ocean carriers. Where the terminal pool is the only chassis source, it effectively becomes a neutral chassis pool. Where a terminal pool just supplements carrier chassis supply at the same terminal, it would not have the same advantages as a neutral pool. Cooperative Pools The cooperative chassis pooling concept was pioneered by Maher Terminals at the Port of New York and New Jersey. The multiple lines calling at Maher's Terminal contributed chassis to the pool, initially in proportion to their container volumes. The pool was able to achieve a 25% reduc- tion in the number of chassis required to serve the combined volume. Chassis condition also was improved. Consolidated Chassis Management (CCM) pools currently include over 100,000 chassis at pools serving the South Atlanta and Gulf port areas as well as inland points such as Chicago, the Ohio Valley, Denver, and Atlanta. CCM is an affiliate of the Ocean Carrier Equipment Management Association (OCEMA), and was established in 2005 to develop, own, and operate chassis pools. The CCM pools are assembled from chassis contributed by the 20 ocean carrier members and pool participants and leased from independent fleets such as Flex-Van and TracLease. All CCM pool chassis must meet FMCSA standards. The unitary Pool Concept implemented by CCM cre- ates a single pool at each facility, allowing leasing companies with neutral pools in place to become contributing users in the CCM pool. Folding in the neutral pools also accommodates ocean carri- ers that are not CCM members. Actual operational management of CCM pools is performed by either Flex-Van Leasing Co. or Seacastle Chassis/Trac Lease, depending on location. Third-Party Pools A good example of a third-party pool is the TRAC Metro Pool-Metz regional chassis pro- gram. The pool currently charges $9 per day and is accepted at eight marine terminals located in Baltimore, Philadelphia, Staten Island, and Northern New Jersey as well as six rail intermodal terminals. The pool contains more than 14,000 chassis and serves 17 marine shipping lines. Typ- ically, the lines pay the chassis charges. The advantage for the motor carrier is that it can make double moves as long as the service involves participating lines, railroads, and/or marine termi- nals. TRAC is responsible for normal wear and tear. The motor carrier pays only for damage. TRAC is responsible for keeping the pool equipment in balance. Repositioning costs are charged to members responsible for deficit situations. Direct ChassisLink APM/Maersk is in the process of changing the way in which the firm supplies chassis. The Maersk Equipment Service Company, Inc. (doing business as Direct ChassisLink Inc.) is now 2 A Glance at Clean Freight Strategies: Common Chassis Pools for Drayage, U.S. EPA Office of Transportation & Air Quality, Washington, D.C., undated.

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70 Truck Drayage Productivity Guide providing Maersk fleet chassis to motor carriers for $11/day. The effort began in the Port of New York and Northern New Jersey rail terminals and container yards in late 2009. The system now involves 16,000 chassis, 25 locations, and 10 states. The structure of this pool permits Maersk to operate efficiently in a wheeled environment as the motor carriers can conveniently off-hire chassis in several locations. In addition, Maersk provides a discount when chassis use is tied to free time Maersk provides to its customers. Long-Term Solutions: Trucker/Third-Party Chassis Supply Chassis condition and supply is a perpetual point of contention between drayage firms, marine terminal operators, and ocean carriers. Chassis are a source of trouble for all concerned as follows: Ocean carriers incur the expense of providing, maintaining, and managing chassis only in the United States. Chassis supply is a management headache and a cost center to be minimized whenever possible. Given a choice, ocean carriers would probably exit the chassis business. At marine terminals, chassis supply uses up valuable space, ties up lift equipment, and requires far more maintenance equipment and labor than containers. Given a choice, terminal operators would probably also exit the chassis supply business and move the function off-terminal. Some terminals have already moved chassis functions off-terminal whenever possible. Drayage firms and their drivers begrudge the time spent locating chassis, the time spent dealing with chassis condition, the need for chassis flips, extra trips to reposition chassis, and adminis- trative time and cost for resolving damage and liability issues. Given a choice, many drayage firms would prefer to provide chassis themselves (with appropriate compensation), or have chassis provided by customers or third parties. A potential long-term strategy would be for ocean carriers to stop providing chassis and shift to the systems used in other countries. That shift also would bring port drayage in line with other trucking sectors, all of whom typically supply their own trailers. Changing to a trucker, customer, or third-party chassis supply would eliminate The need to identify or inspect chassis at marine terminal gates, or to document their inter- change (EIRs would still be needed for the containers themselves); The need for drivers to locate a chassis at grounded terminals, or to spend time hooking up to chassis and testing chassis condition; All trouble tickets, disputes, and other exceptions related to chassis (although equipment-related trouble tickets are a small portion of the total); The need for chassis flips for mismatched chassis and container combinations; Roadability canopies and chassis maintenance and repair (M & R) functions at marine termi- nals; and The need to store chassis at marine terminals, thereby freeing up substantial space. It is likely that elimination of carrier-supplied chassis also would relieve marine terminals of the need to supply generator sets for refrigerated containers. Such a change would likely also eliminate wheeled operations at marine terminals, which is itself a logical evolutionary step for the industry. A shift to trucker, shipper, or third-party chassis sup- ply would also affect the operation of rail intermodal terminals, which are almost all wheeled.