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January 6 2020

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36 The Journal of Commerce | Januar y 6 2020 www.joc.com Maritime 2020 ANNUAL REVIEW & OUTLOOK necessary to reposition chassis. Each truck can move four to five chassis. To move 1,200 chassis, for example, requires as many as 300 available trucks, often on very short notice. Since there is a correlation between import surges and truck demand, available drivers and capacity is harder to come by even without the sudden need to reposition chassis from one market to another. "There is a lot of work on infor- mation sharing for forecasting, but I don't think it's a well-oiled machine yet," Manning said. TRAC Intermodal CEO Jennifer Polli agreed that some customers are better than others in terms of shar- ing volume data, but it's trending in the right direction. She said if ocean carriers were to share ship manifests prior to depar- ture from Asia, equipment providers could plan for vessel arrivals in the US more easily. If, for example, By refurbishing the oldest and most chronically broken units — installing LED lights, anti-lock brakes, and radial tires — chassis providers also aim to reduce the per- centage of chassis out of service. Location, location, location Some providers argue there are enough chassis in use to handle volume crunches, but due to the often unpredictable nature of cargo flows, they're rarely where they need to be. In other words, it's not an issue of sup- ply, but one of matching that supply with the market in need. "There are attempts to develop better data sharing to anticipate issues in advance. But if you don't have five or six weeks of lead time, it's hard to reposition enough chas- sis from one market to another to handle a spike," said Dave Manning, chairman of the NACPC. He explains that a truck is TRAC knew how many CMA CGM or APL containers were due to land in Los Angeles on a given vessel and how many were going inland to Chi- cago or Memphis, it could position chassis accordingly. Class I railroads also provide information to chassis providers on what containers are on which trains. "I think we get decent volume information. Is it perfect? No. Will it ever be perfect? I don't know. But the turn times [the number of days a BCO holds onto a chassis] are very difficult to predict, even with histor- ical data," Polli said. Complicating matters, contain- ers traveling inland via an off-dock rail facility require a chassis for the drayage move to the rail terminal, while those using on-dock rail do not require a chassis, noted Ron Joseph, chief operating officer of DCLI. "Let's say a vessel is going into Los Angeles. We may know when US WEST COAST ports have a plan for regaining some of the market share they have lost over the past five years due to expensive terminal leases, labor issues, high intermodal rail rates, and costly environmental regulation. They say they are prepared to build the infrastructure and implement the technology that is needed to move cargo cheaper and faster. "The only way to stay competi- tive is to operate more efficiently," Dustin Stoker, chief operating officer at the Northwest Seaport Alli- ance (NWSA) of Seattle and Tacoma, told the DrayTech seminar in Long Beach in June. For West Coast ports, which ship more than two-thirds of their imports inland to the eastern half of the coun- try, that means making the transfer of containers from the vessel to rail and truck carriers more efficiently and at a lower cost to beneficial cargo owners (BCOs) than they do now. "We get the cargo off the ships fine," Michael DiBernardo, deputy executive director of marketing and customer relations at the Port of Los Angeles, told the Propeller Club of Southern California in November. "Getting the cargo to the rail and trucks out of the gate on time is how we will compete with the East Coast ports," he said. West Coast ports compete for discretionary cargo from Asia with ports on the East and Gulf coasts and with the Canadian ports of Vancou- ver and Prince Rupert. West Coast ports' share of US imports from Asia declined from more than 70 percent in 2014 to 66.6 percent in the first 10 months of 2019, according to PIERS, a sister product of The Journal of Commerce within IHS Markit. As manufacturing in Asia contin- ues to migrate from China to South- east Asia, West Coast ports will lose more market share because East Coast ports are well-positioned geo- graphically for all-water services via the Suez Canal from Singapore and points west. In the first 10 months of 2019, US imports from Asia to the West Coast declined by 3.2 percent, whereas imports increased 5 percent through the East Coast and 17.4 per- cent through the Gulf Coast, accord- ing to PIERS. Vancouver and Prince Rupert continue to expand their presence in the US market at the expense of all West Coast ports, but especially with Seattle and Tacoma. Over the past five years, the two Canadian ports increased their share of US imports Coastal recoup US West Coast ports competing through infrastructure and technology By Bill Mongelluzzo

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