Dive Brief:
- Shippers in the U.S. will face fees for requesting "street turns" — the exchange of a container outside of a marine terminal — from HMM, ZIM and Maersk Line starting in February, according to various filings.
- The administrative fees — charged for the "reuse" of equipment, or "when a trucker and container are fully utilized in both directions," according to the Agriculture Transportation Coalition (AgTC) — will range from $30 to $75, depending on the carrier.
- The fees are common in other parts of the world, such as Europe, Luc DeClerck, CEO of Avantida, told Supply Chain Dive. Maersk Line this week signed a partnership with Avantida, a software platform, to help it digitalize the street turn approval process in the U.S.
Dive Insight:
The news led members of AgTC to call the administrative fees "insane" in a press release, claiming they "disincentivize street turns" and are "contrary to the many efficiencies we have worked so hard to gain over the past years."
Street turns, AgTC members claimed, reduce trucks making moves at ports and on highways, thereby reducing congestion, fuel use and emissions. They also improve utilization of equipment. If a container or chassis does not travel back to a designated drop-off point empty, shipping lines save costs, AgTC said.
"Why would ocean carriers now act to penalize such efficiencies?" the press release asked.
Shane Bridges, head of equipment for North America at Maersk Line, told Supply Chain Dive the fees are meant to recover some of the costs from changing the trip plan for equipment. The fees are applied only when the street turn request is accepted, he said.
"From our standpoint, we know there is considerable saving that's happening on the truck side." Bridges said. "But in other cases, they've probably been paid to go pick up from other locations."
He said not all requests are approved. Container lines need to know the location of their equipment and plan their moves around this. If the line sees a deficit of containers at a certain terminal, for example, the carrier may want to target it to specific customers that will move the equipment where it needs to be next.
Now with Avantida, when a request is approved, it happens instantly. Bridges said the benefit of a digital platform for street turns is it saves trucking companies time, adds visibility to equipment moves and makes the process more efficient for trucking companies. "It's all about efficiency ... avoiding downtime and waiting."
But Peter Friedmann, executive director of AgTC, said it reduces efficiencies and actually costs truckers money. "What this does is eliminate one truck move," he told Supply Chain Dive. "The trucker gets paid whether he's hauling an empty container or a full container. So who saves? It's the exporter and importer who save."
He argues there is little to no money to be made for trucking companies in street turns — drivers get paid anyway. There are savings, but for the entire supply chain: in emissions, fuel use and total trucks on the road. The issue is particularly concerning in California, where the state government is pushing for a near-zero emission supply chain.
"The beneficial cargo owners, they're the ones that want these street turns. They're the ones who save," Friedmann said. "Truckers are losing business."
