News / FMC in new bid to end 'box rules' for chassis use

Eduard Goricev

The US Federal Maritime Commission (FMC) is having another go at trying to stop restrictive practices limiting trucker choice of container chassis – but drayage executives are not holding their breath.

The agency ruled two years ago that it was unreasonable to force truckers and shippers to use equipment from chassis providers designated by ocean carriers when they collect containers at ports or rail heads. They should be free to deal directly with chassis providers, or use their own equipment.

Container lines had sold their chassis pools to private firms but continued to designate containers to those providers, using so-called ‘box rules’. This contributed to the massive problems truckers faced during the congestion of 2022/2023 trying to drop off and pick up containers from ports and rail terminals, which resulted in wasted journeys and detention and demurrage charges.

The new probe was triggered by numerous complaints that the shipping lines and their chassis providers continue to adhere to their old practices, in violation of the FMC ruling.

“There has been no change. We see box rules at every wheeled or half-wheeled facility in this country, but specifically in Memphis, Chicago, Savannah, and LA,” one drayage executive reported. She added that use of private chassis had been very limited in Memphis because of box rules.

If truckers insist on using their own equipment, they incur extra time and cost required to switch a box from the assigned chassis to their own.

The Agriculture Transportation Coalition has been a vocal critic of box rules for years, as they entail higher prices than if a trucker used a proprietary chassis.

“What we need is for the shipper to have the choice of chassis provider,” commented Peter Friedman, the interest group’s executive director.

Paul Brashier, VP global supply chain at ITS Logistics, remarked that small shippers were particularly at risk, with the system being prone to breaking down when supply chains are under strain.

The FMC obviously sees a need to rectify the matter and has asked for comments from the public. Those are due by 27 March.

But despite the frustration over the issue, industry executives doubt the FMC’s move will result in a significant change.

“We probably won’t see major shifts or a policy change,” Mr Brashier said.

In his opinion, it would require a situation like the supply chain strains triggered by the Covid pandemic to build up sufficient pressure for change.

“There’s not enough appetite and demand to make a shift. Everything is moving relatively smoothly, turn times are down, ports operate smoothly,” he said.

The drayage executive agreed that there was not enough push from cargo owners and other parts of the supply chain. The rail carriers ought to stand up to the ocean carriers and chassis providers, but they do not challenge the status quo, she added.

“There is complacency because we’re not desperate about picking up freight. People don’t care about chassis until they need one,” she said.

This is unlikely to change in the near term, given projections of low import volumes for much of this year. Mr Brashier said: “I don’t see huge volume spikes until the end of the year.”

Meanwhile, shippers do not seem over-concerned about box rules. He noted that cargo owners’ pre-Covid habit of booking ocean transport to door appears to be on the rise again.

“We see a lot go back to that mode,” Mr Brashier said.