Freight News, Sea

Street Turn Penalties to Result in Decreased Capacity

[ January 23, 2019   //   ]

In a critical capacity environment for all stakeholders, Ocean Carriers SM Lines, ZIM, Hyundai, and Maersk have announced a disturbing penalty on “street turns” ranging from $30-$75 a box.

• Maersk $30
• ZIM $40
• Hyundai $50
• SM Lines $75

Simply put, everyone wins in the street turn scenario:

• CAPACITY: Capacity is created for both importers/ exporters on a mass scale by eliminating an entire leg in the process. Trucking companies can handle more volume, with less trucks.
• DRIVER EARNINGS: Drivers are able to make additional turns per day, which increases earnings.
• VELOCITY: CY/ Ports/ Rail terminals see reduced waiting time and congestion
• THE FUTURE: As containers volumes grow, street turns become even more important.

According to Patrick Maher, Executive Vice President, Gulf Winds, enforcing an efficiency penalty on trucking companies and the carriers’ clients, will have a ripple effect across the supply chain. “Most notably, it comes on the back on hard working drivers,” he said. “Their earning potential will be negatively impacted during a time when great strides have been made by the industry to increase turns, driver pay, and efficiencies.”
Anything that restricts, inhibits or impairs a street turn will result in everyone losing:

• Increasing the number of trucks in and around ports, counter to all green initiatives.
• Increased congestion on roadways and port terminals.
• Higher rates to shippers as fees and inefficiencies must be passed along.
• Further reducing driver capacity. More trucks needed to haul the same volumes.
• Negative impact on driver wages through less turns being achieved in a workday.

“We will continue to work through our trade associations and ask that you also make your voice heard on this important issue,” Maher said. “If you have any questions or would like to discuss further, please contact your GWI Business Development Representative.”