Cargo hauled over the road requires three major vehicle parts. The rig (or truck), the chassis (the wheeled metal trailer frame) and the shipping container that sits on top of it. Chassis dwell is how long the shipping container sits idle between moves, and it currently drives costly inefficiency in intermodal freight.
When chassis aren’t moving, they’re not transporting goods. They also aren’t available where they’re needed, creating equipment shortages across the supply chain.
Logistics expert Vahooman “Shadow” Mirkhaef, who operates Cub Terminal, a container yard and maintenance facility in McCook, Illinois, is familiar with chassis dwell challenges. He’s spoken about the operational decisions that drive chassis dwell and what it actually costs companies and consumers.
Why Chassis Dwell Is Increasing
Chassis dwell has worsened in part because of a shift in how chassis are owned and managed. Prior to the early 2000s, ocean carriers owned and maintained their own chassis fleets, including the costs in shipping rates. As carriers exited that business, third-party leasing companies stepped in, fragmenting chassis ownership across multiple providers with competing contractual arrangements.
Those arrangements can reduce the supply of available equipment even when chassis physically exist. The result is a system with more friction and fewer incentives for any single party to optimize.
Direct and Indirect Chassis Dwell Costs
Higher-than-desired chassis dwell generates direct and indirect losses. Financial penalties, downstream equipment shortages and productivity losses across the workforce can add up to billions each year.
Fees Related to Chassis Dwell
Extended chassis dwell can lead to detention and demurrage charges, which are paid when equipment sits beyond the allowed “free” time, if any. The charges accrue daily and may escalate the longer equipment sits, creating compounding exposure for shippers, motor carriers and cargo owners.
According to ShippingRates, D&D charges can reach $20 billion annually across the industry. Fees may range from $100 to $150 per day per container.
Downstream Chassis Shortages
When chassis sit idle for extended periods, they aren’t available where they’re needed. A chassis parked under a container at a warehouse isn’t at the port or rail ramp where a driver needs one. Multiply that across thousands of units, and chassis pools deplete rapidly, creating shortages that cascade across the network.
“Equipment doesn’t take care of itself,” Mirkhaef told TechTimes. “If you don’t have the yard capacity and the M&R infrastructure to turn chassis quickly, you’re pulling capacity out of the network without realizing it.”
Productivity Losses
Excessive chassis dwell negatively impacts operational productivity. These losses don’t always show up on financial reports, but when they accumulate across a fleet or facility, they drive down the bottom line.
Examples of chassis-dwell-related productivity challenges include:
- Driver downtime. Drivers waiting for available chassis aren’t moving freight, logging fewer turns per day and losing billable hours in the process.
- Terminal slowdowns. Equipment backups can reduce throughput at the nodes.
- Delayed inventory. Late deliveries can create production schedules and inventory window issues, leading to downstream impact for business partners and customers.
- Rising labor costs. Carriers facing idle time and rescheduling absorb increased labor expenses that rarely get traced back to chassis availability.
Sometimes, productivity losses related to chassis dwell are associated with operational inefficiencies built into processes. Research prepared for the Maritime Transportation Research and Education Center by the University of Arkansas examined such a case: the chassis mismatch problem.
Contractual agreements between ocean carriers and chassis leasing companies restrict which chassis can be used with which containers. A driver can arrive at a rail yard with available chassis on the lot and be unable to use them because they belong to the wrong pool. According to the research, this forces drivers to search yards for compatible equipment, a process that reduces truck move productivity by 21%.
The Chassis as Storage Issues
Not all chassis dwell is due to operational inefficiencies; sometimes chassis are deliberately held in place. If rail storage fees are high and warehouse labor is tight, shippers may leave containers on chassis instead of unloading them. Even given some of the costs above, chassis may provide mobile storage that’s cheaper than other options.
The tradeoff, however, is that every chassis used in this manner reduces supply across the network. During periods of high import volume or labor shortages at distribution centers, chassis storage behavior can become widespread enough to compound the availability problems that normal chassis dwell already contributes to.
Chassis Dwell Benchmarks vs. Real Figures
According to the University of Arkansas report, industry guidance on ideal chassis dwell sets a benchmark of 3-4 days. Real-world figures don’t come close to that bar. The researchers examined chassis dwell at the Mid-South Chassis Pool in Memphis, one of the largest in the region. The average dwell time reported was 21-26 days.
Mirkhaef notes that inland hubs across the country, including Chicago, the largest inland freight hub in North America, face similar pressure. When freight diverts from congested coastal ports, it concentrates at interior nodes that aren’t always equipped for that volume of chassis. The gap between ideal benchmarks and actual chassis dwell can widen during those times.
Reducing Chassis Dwell
Mirkhaef has said that operational discipline and infrastructure readiness are foundational for network performance. Facilities that maintain adequate yard capacity, staffing and maintenance infrastructure are better positioned to turn equipment quickly, reducing dwell cycles that create downstream shortages.
For supply chain companies addressing chassis dwell and related costs directly, helpful strategies may include:
- Tracking chassis in real time to prevent equipment from sitting unnoticed at facilities
- Negotiating extended free time in carrier contracts to reduce D&D exposure
- Pre-scheduling dock appointments to reduce driver wait times
- Avoiding using chassis as storage to return equipment to circulation faster
- Pushing for gray pool access where available, as interoperable pools reduce mismatch delays
- Auditing D&D invoices regularly, as billing inaccuracies are common and motor carriers often absorb charges that could be disputed
- Using demand data to forecast chassis positioning to support proactive resource management
