How Small and Medium-Sized Companies Can Navigate Freight Chassis Shortages
Of the myriad challenges miring supply chains, a persistent shortage of freight-carrying truck chassis has been among the most troublesome for small and medium-sized businesses. Getting containers out of terminals has taken up to two weeks when chassis are hard to find. The situation is grim, but there are still ways to work around the chassis-availability problem.
While most cargo owners point to the COVID-19 pandemic as the cause of chassis shortages, the origins of the problem go back to 2011. At the time, most ocean carriers withdrew their chassis from ports and ramps as a cost-cutting maneuver related to maintenance and repairs. The move created cyclical instability in chassis availability through the following years that foreshadowed our current situation. As a result, drayage providers gradually started buying their own chassis.
Jump ahead to the pandemic era and we see that the chassis shortage has only amplified. An already fragile inventory combined with an explosion of import container volumes produced huge demand and a limited supply. Locations ranging from Kansas City and Chicago to Newark and Long Beach saw dwell times of 10-15 days before chassis became available to move containers.
While the import container crush has subsided, chassis shortages remain. This is linked to the fact that cargo owners are leaving containers sitting on chassis, despite the additional cost, because warehouse storage is scarce. Chassis units have effectively become a storage solution for cargo owners who cannot find warehouse space.
Drayage providers quickly became the scapegoat of the chassis shortage situation. However, it is with these carriers that the solution lies. Small and medium-size businesses ought to use drayage providers who own their own chassis. Doing so may incur slightly higher line haul charges than the competition — but it is worth paying a few extra dollars to know that the carrier will move your containers in and out according to your ocean contract. Until the situation stabilizes, this remains our most effective path.
Director, 3PL Solutions