12.13.2021The Wheels on the Chassis Go Round and Round...not

With the current focus on the tens of thousands of containers stuck on ships outside major U.S. ports, it's easy to forget a maxim of supply chain management: If it's not on wheels, it's not moving.

Equally important as the big steel boxes that carry virtually every type of consumer product imaginable is the set of wheels — the chassis — that ferry them between modes and to final destination. And chassis today are in seriously short supply where they're needed most.

A significant number of chassis are stuck beneath containers, both empty and loaded, parked in yards awaiting trucks to haul them away. Others are awaiting maintenance or repair, or squirreled away at some undisclosed inland site.

"The fleet wasn't made to accommodate this level of cargo volume," says Mike Wilson, chief executive officer of Consolidated Chassis Management LLC (CCM), which oversees a nationwide pool of "neutral" chassis, available for rental to all shippers and motor carriers. Dwell times have lengthened considerably in recent months, he says, with the period between a chassis leaving the yard and returning for reuse going from 5.2 days to around 12 days.

Wilson hesitates to apply the word "shortage" to the present-day state of affairs. With cargo backed up from ports all the way to inland points, it's more than a matter of adding equipment. "If we were able to pump in another 100,000 chassis," he says, "they would more than likely end up under boxes parked at a distribution center or warehouse yard, just like currently."

Chassis have been a sore point with shippers and transportation providers ever since ocean carriers began shedding ownership of that asset more than a decade ago. Today, says Wilson, approximately 40% of the operating marine chassis fleet is in private hands, dedicated to particular logistics service providers, while 60% is operated in pools such as that of CCM. A handful are controlled by shippers themselves, although that model is difficult to sustain without sufficient volume to justify the investment.

The problem of accessing chassis has been in the making for a long time, well before the current congestion triggered by factors arising from the COVID-19 pandemic. And the mix of ownership options hasn't made the situation any easier to puzzle out. When ocean carriers divested their chassis, many of the units were sold to leasing companies that have moved increasingly toward the use of proprietary equipment.

Wilson believes the concept of interoperable pools to be the better direction for chassis provision in the years ahead. "It's the most efficient way to operate," he says. "To be able to put any chassis under any box, and drop off at any facility, gives flexibility to motor carriers. You don't have to go hunting for specific chassis."