This document discusses equipment maintenance issues in the transportation industry. It provides background on the author and outlines challenges with the current chassis maintenance situation. Key points include a lack of data on component life and maintenance costs, perceptions not matching facts around issues like retread tires, and the chassis operating environment not being significantly different than other vehicles. It proposes starting collaboration on low-cost initiatives like ensuring proper tire inflation and benchmarking the current fleet condition to establish baselines.

1. Equipment Discussion Paper
Greg W Stephens
Lean Transit
info@leantransit.com
4/28/2014 Greg W Stephens 904 333 4469 1

2. 4/28/2014 2
Discussion Items
 Greg Stephens background
 Near term situation: USA
 Factual, anecdotal, and speculative
conclusions
 Problem solving approach
 Questions/issues
Greg W Stephens 904 333 4469

3. 4/28/2014 3
Business Background
 Consulting Practice: Margin Improvement, Process
Control, Shipper/Rail Contracts, IT/Decision Support
Systems, Engineering Economics, Fuel Surcharge
 Education: MS Computer Science, Lean Six Sigma
BB, PMP and CTL certified.
 Manager Engineering Economics: AAR,
Controller/CFO CSX Intermodal
 Joint carrier ‘best practices’ projects on commercial
and technical issues.
 Variety of projects from Nuclear Weapons on
Railroads to Design of Integrated trains.
Greg W Stephens 904 333 4469

4. 4/28/2014 4
Chassis Status Quo and Near Term
Outlook
 IEPs perceive that maintenance cost is too high today.
 Little factual evidence demonstrating relative
culpability of owners, draymen, vendors, terminals for
chassis mechanical condition
 No credible evidence that maintenance $ is reason for
mechanical condition
 Seems to be broad agreement that cost of safety
improvements will fall to chassis owners (OCEMA and
ATA sponsored analysis).
 Estimates of $ impact from $8 to $50 per interchange.
The lowest estimate for a fleet of 10,000 chassis would be:
10,000 * 40 interchanges/year * $8 per interchange = $3.2M
Greg W Stephens 904 333 4469

5. 4/28/2014 5
Maintenance Unknowns are
Significant
 Lack of quantitative analyses on expected component
life (miles, time, and event driven)
 Little quantitative information on impact of operating
environment on maintenance requirements
 Little information on what maintenance costs should
be from an engineering perspective
 Conclusions tend to be anecdotal:
 Overweight chassis: Most credible study in U.S. found 36% of
containers overweight; 70% of those by less than 1 ton.
 Chassis tend to be maintained as a collection of
components not as a machine.
 Components replaced/repaired either at inspection or failure
 Creates continuing, permanent cost issue with interdependent
components
 Why replace a tire on a misaligned axle?
Greg W Stephens 904 333 4469

6. 4/28/2014 6
Examples: Retread Anecdote and
Fact
 Perception that retreads have higher failure rates than new tires
 The probability that your airline departure will be on retreads is
about 80%
 Retread tires have same safety standards as new tires as
specified in FVSS 117. State standards cannot be lower than
Federal standards
 According to NHSTA report DOT HS 811 060 “the primary safety
issue for retreads – air pressure maintenance – is the same for all
tires regardless of whether they are new or retread…In other
words there are no distinguishable differences in safety issues
based on a tire’s OE or retread status.”
 Retreads are used on commercial airliners, military vehicles,
commercial fleets from TL carriers to UPS, FEDEX, state and
municipal governments, ambulances and other rescue vehicles.
Greg W Stephens 904 333 4469

7. 4/28/2014 7
Speburg Study: Can chassis tire life
ever approach OTR tire life?
EXPECTED BIAS PLY TIRE LIFE (MILES)
INFLATION NEW TIRE RETREAD TIRE
METHOD LIFE (MILES) LIFE (MILES)
COMPRESSED
AIR
162,000 125,000
NITROGEN 269,000 269,000
The Speburg study is the only study identified that used
appropriate controls and studied bias ply tires. Studied tire wear
for 60 million tractor miles in a variety of operating environments.
Transport Canada updated analysis for Canadian long haul and off
road trucking using radial tires
Greg W Stephens 904 333 4469

8. 4/28/2014 8
Example: Chassis operating
environment
 Perception that chassis operating environment is so
severe that it accounts for a significant difference in
tire life between chassis and OTR trailers.
 Tire wear is due to friction. Primary maintenance
related causes of excessive tire wear are
 under inflation,
 alignment,
 wheel balance,
 bearing wear,
 worn suspension components
 Mismatched tread patterns
 Physics of tire wear are the same for Port Operations.
Greg W Stephens 904 333 4469

9. 4/28/2014 9
Comparative Operating
Environments
 Chassis operating environment factors were derived
from a chassis and semi-trailer movement database
collected over 6 years (about 6 million movement
records)
 TL and Heavy Haul data is from the DOT’s Motor
Carrier Operating and Financial Statistics database of
2,000 motor carriers.
 Information received from chassis owners, drayage
carriers, maintenance vendors, government and
private research supplements the quantitative data.
 Comparison based upon Gross Ton Miles
Greg W Stephens 904 333 4469

10. 4/28/2014 10
Operating Environment: Chassis generate
about 1/5 of TL GTMs on a set of tires
COMPARISON OF OPERATING ENVIROMENT: CHASSIS VS SEMI TRAILER
ANNUALLY CHASSIS OVER LIFE OF TIRE CHASSIS
CHASSIS SEMI VS SEMI CHASSIS SEMI VS SEMI
MILES/YEAR(1) 22,000 53,058 (31,058) 24,860 150,000 (125,140)
LOADED MILES(2) 13,200 47,753 (34,553) 14,916 135,000 (120,084)
EMPTY MILES(2) 8,800 5,306 3,494 9,944 15,000 (5,056)
URBAN MILES(3) 7,143 3,538 3,605 8,071 10,003 (1,932)
INTER CITY MILES(3) 14,857 49,520 (34,663) 16,789 139,997 (123,208)
GROSS TON MILES/LOADED 429,000 1,169,937 (740,937) 484,770 3,307,500 (2,822,730)
GROSS TON MILES EMPTY 77,264 39,794 37,470 87,308 112,500 (25,192)
ADDED GTM OVERWEIGHT 12,382 0 12,382 13,991 - 13,991
TOTAL GROSS TON MILES 518,646 1,209,731 (691,085) 586,070 3,420,000 (2,833,930)
Assuming a properly maintained tire the key drivers of tire wear for a
chassis are:
(Miles * Weight)= GTM, Speed, Road Conditions, Urban Driving
There are no obvious factors of tire wear, other than maintenance, that put
a chassis at a 1:5 disadvantage over the expected life of the tire
Even semi-trailers don’t avoid yard jockeys in drop and hook operations
Greg W Stephens 904 333 4469

11. 4/28/2014 11
Project Fundamentals: Business
Issues
 USA view that IEPs have little leverage. May be the
same for ROW owners.
 Every player can be influenced by dealing with what they
want (sticks or carrots)
 Maintenance vendors can’t ‘kill the goose that laid the
golden egg’
 Ports want business and labor unions want jobs
 Railroads don’t want in the chassis business
 Motor carriers need a reliable chassis
 AAR and ATA provide some good examples of
benefits of building alliances but benefits become
shared.
Greg W Stephens 904 333 4469

12. 4/28/2014 12
Possible Starting Place
 Start with some initiative that will pay off quickly.
Alternatives might include mandating that:
 Maintenance vendor checks and inflate tires each time a
chassis is touched by vendor.
 Contract with some third party to check tire inflation at out-
gate.
 Contract with a third party to go to each pool location with a
truck mounted air compressor and start filling them up.
 Getting tires inflated will extend tire life and reduce
tire failures. Every study identified under inflation as
the #1 cause of excessive wear and tire failure.
Greg W Stephens 904 333 4469

13. 4/28/2014 13
Project Steps
 Start with an “air” program even if small.
 All carriers in joint study with SM programs had lower costs
than those without.
 SM plan evolved over time
 Focused on known high payoff areas first
 Switch to Nitrogen from Compressed Air. Air sucks.
 Establish a benchmark of mechanical condition of
fleet: not expensive – use stratified random samples.
 Determine with confidence existing component life
 What should component life be: lots of public info?
 Use Statistical Process control to measure
performance. Process control problem masked as a
budget problem.
 Huge number of tools/techniques to facilitate an SM
Greg W Stephens 904 333 4469

14. 4/28/2014 14
Prototype Maintenance Vendor
Business Model
 Maintenance and parts vendors maximize
profits by maximizing IEPs cost.
 Long term mixing of business and personal
relationships may impede change
 Some view systematic fraud as an issue
 There may be qualified people interested in an
alternative business model
 A better mousetrap is an opportunity
 Fixed price maintenance cost per unit including
tires
 Few services on a variable cost basis (e.g. collision
damage, theft and fraud)
Greg W Stephens 904 333 4469