Consolidated Chassis Management LLC
With their reach across roads, rail and water, chassis represent a critical part of the international supply chain. “Train and container ships depend on them,” Philip Wojcik declares. “Motor carriers need them to deliver the freight.”
Wojcik is the president and CEO of Consolidated Chassis Management (CCM) LLC, an organization that strives to make working with chassis easier. The Budd Lake, N.J.-based, company manages chassis at major ports and metropolitan locations, ranging from the southeastern United States to the Gulf, and inland from the Ohio Valley to the Rockies. CCM credits its success to the fact that it operates with a non-profit philosophy.
The Ocean Carrier Equipment Management Association (OCEMA) founded CCM in 2005 to establish chassis pools. Previously, there was no coordinated solution and “the terminals and railroads were requiring development of a greater efficiency of the chassis operations,” he recalls.
CCM’s business includes its CCM Pools division, which combines multiple chassis fleets into one pool at the terminals. Its members can add their chassis to the pool, and then can use any chassis within it.
Today, CCM’s six regional pools support all major Class 1 rails, and it is the sole pool operator for the Georgia Ports Authority and the South Carolina State Ports Authority. “[We are] also the exclusive pool operator at TraPac Terminal in Jacksonville and the Port of Wilmington, N.C.,” he adds.
CCM Pools utilizes a model that allows various entities to become members, including motor carriers, shippers and 3PLs. There are no initiation or entrance fees.
CCM has more than 140,000 chassis under its management. “The ocean terminals and railroads get a tremendous amount of efficiencies built into it by sharing equipment.”
For example, prior to CCM, the GPA terminal in Savannah went from 10,000 chassis on its terminal to less than 3,000 chassis today with CCM, while volumes of loads handled has grown in double digits each year.
The company also has saved the international intermodal industry millions of dollars through gained efficiencies. “Most ocean and rail terminals now depend on the efficiencies that CCM Pools provides,” he adds.
CCM Pools operates with a structure and governance created for “gray chassis pools,” Wojcik says. These allow ocean and motor carriers, leasing companies, shippers and others to access international container chassis under a single unified fleet and management at the lowest possible cost.
Unlike chassis fleets operated by individual entities, a gray pool enables operating savings to be achieved by reducing the combined inventory levels, maintenance and repair economies of scale and reduced chassis repositioning expense through pool members’ offsetting flows, he continues.
In the CCM pools, the savings are passed through to its members.
Terminals also can reclaim acreage by reducing the number of chassis stored thanks to gray pools. Additionally, “Motor carriers are able to transit to a terminal more quickly while obtaining a well-maintained piece of equipment,” he says.
“Customers benefit from a more consistent and reliable equipment supply,” he says.
Luxury of Choice
CCM Pools allows its customers to choose which chassis providers they want to use. The benefits, Wojcik notes, include the ability to consolidate bills, take advantage of lower rates and choose providers with better service.
Chassis customers normally have little choice in the matter, he says. “A container is placed on a chassis at the rail or ocean terminal before the motor carrier arrives for pick up,” he explains. “Unless the container is taken off the chassis and placed on another, the chassis provider is already determined by the ocean carrier.”
However, “CCM can allow the chassis customer to select their preferred chassis provider in its pools on specified chassis movement,” he continues. “Shippers and motor carriers can choose a provider when the ocean carrier and the ocean carrier’s on-terminal chassis provider participate in this CCM program.”
Beyond CCM Pools
CCM has moved beyond its network of pools. On Oct. 29, 2014, the Federal Maritime Commission granted CCM authority to expand its scope and manage chassis outside of the CCM pools.
This enables CCM to provide chassis management services for private fleets of motor carriers, shippers and other entities. “We have proven systems, staff and expertise,” he says. “Our systems are best in class, the finance system is paperless and the tracking and billing system is fully automated.”
For example, CCM can track every activity on a chassis, from the point a container is mounted on it within a facility to what time a motor carrier exits the terminal to the date and time the returned container gets lifted off the chassis.
CCM also has a maintenance and repair system that can track all repairs down to a single light bulb. “The CCM data warehouse combines repairs with chassis movements and allows for tremendous cause-and-effect results from data mining,” Wojcik says. CCM can provide software licensing, manage private fleets, and/or provide management and systems for maintenance and repair of chassis.
A longtime veteran of the industry, Wojcik has served as president of CCM for six years. Previously, he spent five years as the vice president of operations at TRAC Intermodal and 26 years with ocean carriers in senior management roles.
He credits CCM’s success to its cost pass through basis as well as having the right areas of concentration. “Our priorities are safety, then service and then cost,” he describes. “We provide services the most cost-effective way we can by looking out for the interests of all the stakeholders and by being a neutral manager.”
CCM’s design ensures that it has no commercial interests, Wojcik asserts. “Trying to serve the industry is really our top priority and that is why our service is so highly regarded,” he says.
The company also had a strong service rate in 2014. “Each time somebody came to get a container mounted with a chassis, 99.4 percent of the time it was a success,” he says. “Our service level is that top notch.”
The company’s growth reflects this, Wojcik says. “We’ve seen year over year double-digit growth, including an increase due diversions from the congestion on the West Coast,” he says. “The turn times at the terminals are all under an hour for a double move. That’s ideal in the industry.”
CCM’s industry is currently in the midst of dramatic changes. Historically, the ocean carriers provided chassis for their containers, but many are stopping that practice.
“Almost all of the ocean carriers have sold their fleets,” Wojcik states. “The motor carriers and shippers are faced with the challenge of providing chassis. Chassis leasing companies are evolving their retail business models to fill the gap of chassis provision.”
U.S. infrastructure, Wojcik notes, depends on gray chassis pools to handle increasing volumes. In response, “Motor carriers are leasing and purchasing chassis, which can work very well in closed-loop, live lift operations,” he says.
This also puts CCM in a good position with its proven pooling model, Wojcik says. Over time, he predicts, people will better appreciate the pool operations. Perhaps even motor carrier private chassis fleets combining into pools.
“I also think there will be less reliance on chassis with many of the terminals,” he adds. “It will take some time, but eventually, there will be other solutions through this transition that will be developed. We’ll have to wait and see. It really is a big change going on in the industry right now.”
CCM also will continue finding ways to make its chassis more reliable, Wojcik says. Recently, the company started installing LED lights and upgrading the quality of its tires.
“There are many options for chassis customers,” he says. “They can participate in pools, or pay for daily rental, or they can pay for a daily rental in our pool while also choosing the provider. There’s not one perfect answer – it all depends on the customer needs.”
CCM has nurtured strong partnerships. John Trent, the senior director of strategic operations and safety for the Georgia Ports Authority, says both organizations have worked well together over the past six years.
“Their philosophy of providing service and ours mesh together real well,” he says. “We’re trying to provide our customers with the most economic logistics solution.”
CCM’s cargo-flow expertise aids in that goal. “[They will] have the right amount of inventory available when our mutual customer needs the chassis,” he explains.
If a trucker needed to pick up a container and a chassis was not available, “That’s going to create delays and certainly have an impact on the supply chain,” Trent says. “They work hand-in-hand with us to ensure chassis are moved into our terminal in advance of the demand.”
Another CCM partner is William A. McLean, the senior vice president of operations of South Carolina State Ports Authority. “They’ve got the infrastructure, the employees [and] the operational side to manage the pools,” he says.
The company has helped the port authority avoid the alternative of dealing with multiple entities that would “have different maintenance requirements [and] require resources to support all their operations in a terminal,” McLean says. “It makes it hard for a trucker.”
Dave Manning, the president of TCW Inc. and chairman of the North American Chassis Pool Cooperative, also praises CCM. “They’ve provided a real service to the industry, [for] the users, the truckers and the contributors,” he says.
“They’re the ones who initiated the gray fleet concept,” he says. “It’s a big efficiency gain for the industry.
“Any one of the chassis can be used for anyone’s box,” he says. “That makes it more efficient for the rails, the port and for the motor carriers.”
Manning also has enjoyed working with Wojcik. “He’s a very professional leader,” he says. “He understands the market and the concept extremely well. He does a very good job of managing CCM.”