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Home My WebLink AboutP-18-045-P Amend 3.pdf County of Fresno INTERNAL SERVICES DEPARTMENT ROBERT BASH, DIRECTOR – CIO Facility Services • Fleet Services • Graphics Information Technology • Purchasing Security • Telecommunications 333 W. Pontiac Way, Clovis, CA 93612 / (559) 600-7110 * The County of Fresno is an Equal Employment Opportunity Employer * AMENDMENT NUMBER THREE (3) Agreement Number: P -18-045-P February 15, 2022 Battery Systems Inc. 12322 Monarch Street Garden Grove, CA 92841 Contract Number P -18-045 -P covering auto and heavy-duty equipment batteries is amended as follows: The County of Fresno hereby accepts your price increase notice dated January 20, 2022 to be effective February 19, 2022 in accordance with the terms and conditions of our Contract Number P-18-045-P and Revised Attachment “A”. All orders placed prior to February 19, 2022 will be priced in accordance with current contract pricing. Electronic Signatures. The parties agree that this Agreement may be executed by electronic signature as provided in this section. A. An “electronic signature” means any symbol or process intended by an individual signing this Agreement to represent their signature, including but not limited to (1) a digital signature; (2) a faxed version of an original handwritten signature; or (3) an electronically scanned and transmitted (for example by PDF document) of a handwritten signature. B. Each electronic signature affixed or attached to this Agreement (1) is deemed equivalent to a valid original handwritten signature of the person signing this Agreement for all purposes, including but not limited to evidentiary proof in any administrative or judicial proceeding, and (2) has the same force and effect as the valid original handwritten signature of that person. C. The provisions of this section satisfy the requirements of Civil Code section 1633.5, subdivision (b), in the Uniform Electronic Transaction Act (Civil Code, Division 3, Part 2, Title 2.5, beginning with section 1633.1). D. Each party using a digital signature represents that it has undertaken and satisfied the requirements of Government Code section 16.5, subdivision (a), paragraphs (1) through (5), and agrees that each other party may rely upon that representation. This Agreement is not conditioned upon the parties conducting the transactions under it by electronic means and either party may sign this Agreement with an original handwritten signature. Please acknowledge your acceptance by returning all pages of this letter to my office via email or USPS. If you have any questions, please contact Chanvathei Lonh, Purchasing Technician, at (559) 600-7110 or email clonh@fresnocountyca.gov. CONTRACT NO. P-18-045-P Page 2 Battery Systems Inc. February 15, 2022 G:\PUBLIC\CONTRACTS & EXTRACTS\P\P-18-045-P BATTERY SYSTEMS, INC\CONTRACTS & AMENDMENTS\P-18-045-P AMEND 3.DOCX FOR THE COUNTY OF FRESNO Gary E. Cornuelle Purchasing Manager 333 W. Pontiac Way Clovis, CA 93612 GEC:CL: G:\PUBLIC\CONTRACTS & EXTRACTS\P\P-18-045-P BATTERY SYSTEMS, INC\CONTRACTS & AMENDMENTS\P-18-045-P AMEND 3.DOCX CONTRACT NO. P-18-045-P Page 4 Battery Systems Inc. February 15, 2022 G:\PUBLIC\CONTRACTS & EXTRACTS\P\P-18-045-P BATTERY SYSTEMS, INC\CONTRACTS & AMENDMENTS\P-18-045-P AMEND 3.DOCX Revised Attachment “A” Battery Group/Size As New Pricing Effective 2/19/22 24-85 58.83 24F650 (24F-65) 44.34 27LTV 55.56 30H (C-30H) 74.88 C-31-9ST 69.80 C-31-9AP 69.80 34-75 60.27 59-75 55.92 51R-75 36.36 58-75 44.82 58R-75 44.82 65LTV 62.01 75-75 46.76 78-75 51.87 86-75 75.11 January 19th, 2022 Integrity • Customer-Centric • Courteous • Prompt • Attentive • Positive • Continuous Improvement • Team-Advancement • Health & Safety 12322 Monarch St. Garden Grove, CA 92841 Page 1 of 1 County of Fresno Internal Services Department Purchasing 333 W Pontiac Way Clovis, CA 93612 Mr. Gary Cornuelle, Battery Systems respectfully submits to the County of Fresno, an Economic Price Adjustment request for Purchasing Contract # P-18-045-P. Due to current market & regulatory conditions, effective February 1st , 2022, all contract pricing will be increased by 5%. This action is necessary to support increasing costs from manufacturers, in addition to rising costs of ongoing investments in health & safety. While we have worked hard to offset the increasing expenses throughout the previous year, we must implement a slight price increase so that we can continue to provide our customers the level of Service, Selection & Value that they have come to expect from Battery Systems. Should you have any questions or need any additional information, please do not hesitate to contact either the Battery Systems Bids Department or your local Battery Systems of Fresno location. As always, we thank you for your business & ongoing support. Sincerely, Claudia Castanares Battery Systems – Bids Department bids@batterysystems.net 310-667-9320 xt. 13050 Dear Customer, We would like to thank you for your loyalty and support at Hankook AtlasBx. As you’re likely aware, freight costs began escalating in late 2020, the cost stabilized somewhat in 2021 until late April when the cost significantly began climbing again. This increase has been trending in the +10% range with no relief expected over the next several months. Please find details below around the market challenges we are facing with these rates. Ocean Freight Challenges: Ocean rates have reflected in significant increases during 2021 primarily driven by the following:  Non-Stop Demand – Demand consistently exceeding contracted volume  Lack of capacity – Vessel capacity cannot meet shipping lane demands  Container Shortages – 20’ container supply is limited and 40’ containers are not an option for batteries  Port Congestions – More vessels and larger vessels increase wait times, as well as discharge times Due to the high demand and lack of container availability this is reflecting in high premiums to reserve equipment and space. Below is a view of Asia to US average freights costs that have reflected in exponential increases for 2021. Inland Freight Challenges:  Inland transportation logistics demands and backlogs (rail and OTR) Trucking rates have been volatile in 2021 for the US market driven by a high demand of load orders and lack of supply of trucks available. Due to the economy opening back up as vaccinations increase globally and COVID-19 restrictions start to lift in the US this robust boost has caused a tight capacity and high rates. Below is a view of the van load-to-truck ratio representing the number of loads posted for every truck posted. Due to these market challenges we will be increasing the prices of our overseas (DFC) products by 5% of the +10% increases effective with purchase orders received July 1st. A 2% price increase on Tennessee manufactured products will also be implemented on July 1st. We will continue to monitor these rates overtime, however, if the freight costs don’t normalize we will need to pass on an additional increase for Q4 timing. Be assured we have enacted the smallest increase possible while continuing to ensure the quality of all our products and services. Hankook AtlasBx appreciates your continued business as we go through this period of change and growth. If you have any questions or concerns about the increase, please feel free to contact us. Our sales and customer service teams are happy to discuss this situation with you. Best regards, Hankook AtlasBx September 1, 2021 Dear Valued Customer, We would like to take this opportunity to thank you for your continued business and partnership. It is impossible to express how much we appreciate the support that you, our loyal customer, have shown Hankook & Company during these difficult and unprecedented market conditions. Our ongoing commitment to you is to be a valued long-term partner which is a role we take very seriously. We are writing this to inform you about recent adjustments to our prices that will be taking place. We will be implementing a +2.5% freight increase plus LME on overseas (DFC) products that will go into effect on purchase orders being produced from November 2021 through January 2022. A +1.5% freight increase plus LME will also be implemented on Tennessee manufactured products. As always, we have endeavored to keep this increase to a minimum and absorb where we can in spirit of partnership. There are a few main drivers that have impacted our price increase decision discussed below. Ocean Freight Challenges:  The combination of labor shortages, lack of containers, port congestions and a shortage of vessels has created a situation where cargo demand exceeds available capacity causing significant price premiums  The acceleration in delta-variant COVID-19 outbreaks in several countries has slowed global container turnaround rates World Container Index – Assessed by Drewry Inland Freight Challenges:  Inland freight costs have risen significantly because of there being more loads than trucks causing an increase in prices due to demand outpacing supply  Labor shortages of truck drivers in 2021 coupled with semi-conductor shortages keeping new trucks from coming on the market have also been driving price premiums  Disruptions have also been driven by severe weather in areas across North America that have increased backlogs 0 1 2 3 4 5 6 7 8 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Van Load-to-Truck Ratio 2021 Forecast 2020 2019 London Metal Exchange:  Consumption has increased driven from COVID-19 lockdowns as consumers have been seeking replacement for lead-acid batteries that have failed after long periods without use  Lead prices have increased dramatically in North America due to capacity constraints from smelters driven by high demand causing higher premiums  LME change from last quarter is +6.68% We hope that you understand that this change is due to factors beyond our control driven by the market conditions. We value your business and appreciate your loyalty and trust in Hankook & Company. As always, our sales and customer service teams are available if you have any questions regarding the increase. Best Regards, Hankook & Company $1,500 $1,700 $1,900 $2,100 $2,300 $2,500 $2,700 Monthly Lead Price ($) Price $ Avg LME (2020-2021) Clarios 5757 N. Green Bay Avenue Post Office Box 591 Milwaukee, WI 53201 March 15, 2021 Dear Battery Systems, We have held firm with our prices for quite a long time but have now seen significant cost increases in raw materials, transportation and long-term COVID mitigation. We can no longer absorb these increased costs so are taking pricing increases to our valued distributors. MAP prices have increased along with your costs. I appreciate your understanding and am available to any questions yo u might have. Sincerely, Carl Cheffers Clarios/Optima Batteries