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US$5 fee to move chassis on and off SoCal docks inflames customers
ANGRY chassis leasing companies, backed by shippers and truckers in southern California, are petitioning the Federal Maritime Commission (FMC) to end the imposition of a US$5 chassis fee to be levied from September 1.
Three chassis-lessors, Direct ChassisLink, Flexi-Van Leasing and Trac Intermodal, have filed a show-cause petition, charging that the fee under the West Coast Marine Terminal Operating Agreement (WCMTOA) violates the Shipping Act because it is not authorised in the agreement.
They say the fee could cost members of the supply chain an additional $28 million a year.
"If a chassis made multiple entries and exits from a terminal or terminals, with loaded or empty containers, on the same day, the chassis services fee would be assessed for each entry and exit, so that the daily charges for the chassis services fee could exceed the daily published lease rate for a chassis," the petition stated.
But John Cushing, president of PierPass Inc, which manages WCMTOA on behalf of the 13 terminal operators in the LA-Long Beach port complex, said the agreement authorises member terminals to chassis providers.
Mr Cushing also said the WCMTOA is allowed to establish rates, priorities, terms of service and conditions for the interchange of equipment.
Said Mr Cushing: "In short, the agreement allows WCMTOA to do this."
While chassis ownership has shifted from the shipping lines to the leasing companies, the equipment is stored on the terminals' land and thus liable for rent.
Terminal operators have established schedules "requiring that 31,000 chassis be available daily on the 13 terminals served by the pool of pools."
In all, there are 80,000 chassis in use at marine terminals, rail yards and moving to and from BCO (beneficial cargo owners) warehouses in the region.
Curiously, shipping lines who no longer own the chassis are known to be pressuring the terminals not to implement the $5 fee because it would cause strained relations with their customers.
Three chassis-lessors, Direct ChassisLink, Flexi-Van Leasing and Trac Intermodal, have filed a show-cause petition, charging that the fee under the West Coast Marine Terminal Operating Agreement (WCMTOA) violates the Shipping Act because it is not authorised in the agreement.
They say the fee could cost members of the supply chain an additional $28 million a year.
"If a chassis made multiple entries and exits from a terminal or terminals, with loaded or empty containers, on the same day, the chassis services fee would be assessed for each entry and exit, so that the daily charges for the chassis services fee could exceed the daily published lease rate for a chassis," the petition stated.
But John Cushing, president of PierPass Inc, which manages WCMTOA on behalf of the 13 terminal operators in the LA-Long Beach port complex, said the agreement authorises member terminals to chassis providers.
Mr Cushing also said the WCMTOA is allowed to establish rates, priorities, terms of service and conditions for the interchange of equipment.
Said Mr Cushing: "In short, the agreement allows WCMTOA to do this."
While chassis ownership has shifted from the shipping lines to the leasing companies, the equipment is stored on the terminals' land and thus liable for rent.
Terminal operators have established schedules "requiring that 31,000 chassis be available daily on the 13 terminals served by the pool of pools."
In all, there are 80,000 chassis in use at marine terminals, rail yards and moving to and from BCO (beneficial cargo owners) warehouses in the region.
Curiously, shipping lines who no longer own the chassis are known to be pressuring the terminals not to implement the $5 fee because it would cause strained relations with their customers.
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