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May 9, 2017 4:00 PM, EDT

Flexi-Van, DCLI to Start Chassis Pool in Port of New York-New Jersey

Trac Intermodal Won't Participate in 'Pool of Pools'
Direct ChassisLink

Chassis providers Flexi-Van Leasing and Direct ChassisLink Inc. will launch a “pool of pools” beginning June 1, offering trucking companies shared chassis at the Port of New York and New Jersey. But the largest provider in the Northeast — Trac Intermodal — won’t contribute chassis to the pool, and the trucking community remains cautious because some important questions remain unanswered.

Under the pool, trucking companies will have access to about 8,000 chassis in a model similar to the system in Los Angeles and Long Beach, Calif.

DCLI Chairman and CEO Bill Shea said that the rationale behind the decision was to provide more flexibility to motor carriers, emphasizing the chassis supply still is abundant at the port.

Flexi-Van and DCLI still will manage their respective pools independently, set their own daily rental prices and compete with each other for customers.

In the new pool, known as the Asset Sharing Program-Northeast (ASPN), draymen can utilize either supplier’s chassis to haul a container with an affiliated steamship line. Ocean carriers sign contracts to exclusively use a particular chassis provider, but as a consequence truckers often have to swap out chassis when they haul containers from different shipping lines.

Trac Intermodal won’t participate after a two-year negotiation ended without a resolution on a single system. Trac CEO Keith Lovetro proposed a centrally managed pool, or co-operative, arguing that one manager and one set of rules would fix some of the chaos in Los Angeles and Long Beach operation.

“Under the pool of pools, each equipment provider sets their own repair policies, out-of-service policies, that sort of thing. Those kinds of differences make it less efficient than a [centrally managed pool],” Lovetro said.

Jeff Bader, president of the Association of Bi-State Motor Carriers, said it’s too early to form an opinion on the new pool because the two suppliers couldn’t answer key questions in a May 9 presentation. He didn’t know whether the program actually would  launch June 1.

“To be quite truthful, they’re still not in a position to roll it out. It’s still in the discussion stage and it’s not something we can rely on yet,” Bader told Transport Topics. “The devil is always in the details, and they don’t have all the details just yet. We don’t know enough details about participation, place of pickup, place of termination.”

One of the stumbling blocks during negotiation on the Trac centrally managed pool was about control over policy decisions.

Trac owns more than 60% of the available chassis through its Metro Pool, but other parties balked on a structure where voting power is based on market share or size, a model used in many corporations with a board of directors. Trac’s Metro Pool has 17,000 chassis, mostly at the Port of New York and New Jersey, but also in Philadelphia, Baltimore, New England and western New York.

However, Shea insisted that market share had nothing to do with his final decision.

“It had everything to do with what was the best method to serve my customers," Shea told TT. "And the best method of servicing my customers was to remain an independent pool but also create some interoperability with Flexi-Van through the ASPN structure."

He welcomed other chassis providers to join if they meet contractual and insurance requirements.

Trac also announced that 30% of the chassis in the Metro Pool have been refurbished to like-new condition. Lovetro told TT that the repairs demonstrate a commitment to roadability, a concern that the trucking community has emphasized for years.

“Let’s say we’re talking about a 17-year-old chassis. We take it out of the fleet, and we give it to the refurb manufacturer,” he said. “He strips it down to bare metal, sandblasts it, inspects the metal to ensure there are no cracks and repaints it. He’ll also add new tires, electrical systems, airing systems, brakes, LED lights, mud flaps. When it comes back, you’d swear it was a new unit.”

Lovetro said that his company hopes to refurbish more than 2,000 pool chassis per year in the New York and New Jersey market because the trucking community wants quality, reliable equipment.

Trac’s customer base includes 20 steamship lines and more than 800 motor carriers.