b'4American Journal of Transportation ajot.comThe unprecedented KCS cross-borderFactors to consider when striving to acquisition battle: Whats in it formeet unprecedented chassis demandCanadian shippers? The unprecedented demand for chassis that began during the pandemic in 2020 is expected to continue through 2021and While most of the battle between CP and CN is being playedmost likely into 2022. This is why carriers must consider these out in the U.S.,a significant question looms large: Whats inkeyfactorswhenleasingchassistosuccessfullymeettheir it for Canadian shippers? John Corey, head of the Freight Man- needs in this challenging environment:chassis condition, leas-agement Association of Canada shares his opinion of what thising flexibility and service quality. merger might mean for Canadian shippers.ByDoug Hoehn, EVP Marine Chassis, Milestone Equipment Holdings By Leo Ryan, AJOT Special to the AJOTInJuly2000,theboardsofCNperspective?SomecandidinsightsV alue oFneW, m odernC haSSiS andtechnologyfeatureslikeOEM andBNSFvotedtoterminatetheiremerged from an interview with JohnWith the industry average chassisradialtires,LEDlights,anti-lock proposed merger after a U.S. appealsCorey, who for many years dealt withage between 15 and 20 years old,braking systems, disc wheels and, court upheld a 15-month halt on fur- raildisputeresolutionattheCana- most chassis available for leasein some areas, GPS tracking, and therdevelopmentsimposedbythedianTransportationAgency(CTA)are older with outdated featuresautomatic tire inflation systems. federal Surface Transportation Board.before recently assuming the helm ofsuchastwo-piece,five-spokeWhile the daily lease rate for the Two decades later, the STB will makethe Freight Management Associationwheels and bias ply retread tires.newchassisisslightlyhigher a final rulingthoughofCanada(FMA),Thisleadstogreatermainte- thanthatoftheolderchassis, not likely before 2022whosemembercom- nance and repair costs, espe- the total daily operating cost onanothersig- paniespurchaseancially with more usageissignificantlylower nificantcross-borderestimated$4billionduringthepandemic,whenyoufactorin acquisitionproposalinfreightservicesofas well as more break- thegreatlyreduced involving Class 1 rail- all modes annually. Indownsthatproducedailymaintenance ways. But this time theresponding to questionslost driver time on theand repair costs com-NorthAmericanrail- fromAJOT,however,road and lost revenueparedtoolderchas-way sector has becomeCorey stressed that thefrom missed appoint- Doug Hoehn, EVP Marine Chassis, sis.Theestimated the arena of an unprec- FMAwasnottakingments.Forexample,Milestone Equipment Holdings annualmaintenance edented,no-holds- sidesinthematterbias ply retread tires often have blow- and repair costs for a newer chassis barredmano-a-manoandhewasofferingouts, especially in southern parts of theis just $255 compared to $1,600 for a betweenCanadastwopersonal opinion. country with scorching temperatures,refurbished and $2,000 for an older majorrailwaysseek- John Corey, head of the Freightand one blown-out tire typically causeschassis. Newer chassis fleets are often ingtogobbleupManagement Association of Canada T ruThS Tranger threetofourhoursofdowntimeformore diverse as they include 20- and Kansas City Southern, thereby creat- ThanF iCTion driversand significant lost income40-ftmarinemodels,33-and40-ft ing the first fully-continental networkThey say truth is stranger than fic- for carriers. tri-axles,40-and45-ftextendable stretching from Canada to Mexico. tion and in the case of the rival CP/CNHowever,carriersshouldleaselength, 20- and 40-ft combo spread-In the event this giant consolida- bids for the KCS, that is certainly thenewerchassisastheirsuperiorreli- axleortri-axleconfigurations,and tionmaterializes,whataresomeofcase, he began. Very high on intrigue,abilitysignificantlylowersthe53-ft domestic units. These specialty theoverallimplicationsandpoten- suspense and even entertainment value,companysoperatingcosts.Thesechassis are in greater demand because tialgainsfromaCanadianshipper(BATTLEcontinued on page 13) premium chassis have modern safety(FACTORScontinued on page 12)Innovating Logistics One Route at a TimeThere are lots of ways to get from Point A to Point B, but theres only one optimal way. For your business to maximize its profit, you need to avoid weather disruptions, labor shortages, price increases and countless other inefficiencies. Odyssey creates custom-tailored, sustainable solutions across multiple transportation modes. Let us help you navigate the ever-changing logistics landscape.Download our Network Optimization ebook at odysseylogistics.com/optimize and learn the secrets to making your data visible and actionable. 2021 Odyssey Logistics & Technology Corporation'