Consolidated Chassis Management (CCM) has agreed to waive South Atlantic Consolidated Chassis Pool’s (SACP) standard penalties for overutilization (OU) related to Hurricane Dorian. Members eligible for the waiver of these penalties must have been properly fleeted prior to the hurricane to qualify.
“As a collaborative partner, CCM has decided to waive standard OU penalties related to Hurricane Dorian to allow our members to re-assess their needs and re-allocate inventory as appropriate. We understand that hurricanes and other natural disasters cause unplanned business interruptions and wreak havoc on inventory allocations,” said said Mike Wilson, CEO, CCM.
For the last few weeks of the summer season the SACP’s usage on 40-foot chassis exceeded the CCM stress trigger threshold of 75% utilization, translating into OU, which typically results in penalties.
Traditionally OU is the precursor to equipment shortages, which create bottlenecks, slowing down the flow of goods and impacting the efficiency of the supply chain.
“In the case of Hurricane Dorian, it was not a lack of planning that caused the OU, but rather the fact that our members simply could not react in time to increase their fleet. Ports were closed a minimum of two days after each long weekend, causing the amount of outgates to spike. What’s more, the vessels bunched up out at anchor caused a cargo surge as they began coming in to port,” Mr. Wilson continued. “Unavoidable and unpredictable weather conditions are a fact of life in our business. Rather than penalize our members for these unfortunate events, we feel a responsibility to continue to work cooperatively to ensure utilization rates return to normal and that the pool operate at optimized conditions in the very near future.”
Sea News, October 9