If there's one thing shippers and carriers should learn from the past year, it’s to communicate and work more effectively with each other.
Years ago, shippers and carriers got together quite frequently to discuss business. Today, most negotiations are done via long, laborious bids, with very little room for direct communications, and most of the attention is paid to the far right-hand column, a very low freight rate.
About seven years ago, most carriers came to the conclusion that offering chassis had become a costly and logistical nightmare. We filed a chassis-usage surcharge, which was refused by every one of our customers. Is it really any surprise that years later most carriers in the U.S. have divested themselves of chassis? The chassis situation will improve when the gray chassis pools at terminals become a reality.
Mega-ships are being blamed for part of the port congestion problems. Were these huge behemoths mistakes? Well, not when you consider that nearly every attempt by carriers to raise freight rates failed. The only option for a carrier to survive in the current business environment is to keep your slot cost as low as possible.
Port congestion is also blamed on a shortage of equipment. Truthfully, there is enough equipment available in the U.S. So many contracts have free time provisions in them that keep both containers and chassis at shipper facilities far longer than they should be. If you are having problems with getting equipment, perhaps shippers should look at contracts and if you have extra free time, consider shortening it and see what you can do to get equipment back to the carrier in time.
Liu Hanbo, Cosco Americas; President, Cosco Container Lines Americas