New rail services chugging along - The Packer

New rail services chugging along

08/21/2014 02:52:00 PM
David Mitchell

At the same time that rail congestion led to the suspension of Cold Train Express Intermodal Service this summer, two new refrigerated rail services were just getting started.

In June, Minneapolis-based McKay TransCold began offering a refrigerated, dedicated boxcar unit train dubbed Transcold Express, which runs each week between Wilmington, Ill., and Selma, Calif. Meanwhile, Tiger Cool Express LLC, Overland Park, Kan., started intermodal services from multiple locations in southern California to destinations in the Midwest and East Coast in February.

Representatives for both companies said that the congestion that plagued Cold Train on BNSF’s northern lines has had little effect on the southern BNSF and Union Pacific routes that their equipment travels on.

“Since we started in June, we’ve been ahead of schedule on our rail movements,” said Jason Spafford, vice president of business development for McKay TransCold, which offers four-day service from California to Illinois.

On-time deliveries for shipments on BNSF’s Northern Corridor fell from more than 90% in November to less than 5% in April due to surging more oil and coal shipments. Thomas Finkbiner, chief executive officer for Tiger Cool Express, said rail shipments of oil from North Dakota on BNSF’s Northern Corridor have increased from 20,000 tank cars three years ago to more than 400,000 this year. And unlike major southern rail routes in the U.S., that northern route isn’t double tracked.

“That makes it difficult for high-speed trains to keep transit times,” said Finkbiner, whose company uses Union Pacific lines for the vast majority of its business.

Congestion, however, could migrate from one rail network to another as shippers and receivers look for alternatives, he said. Finkbiner said BNSF’s intermodal shipments have fallen 0.5% in recent weeks, while Union Pacific traffic has increased at least 10%. So far, he said, that increase had not affected his company’s schedules.

Tiger Cool launched with 200 containers, and Finkbiner said the company’s goal is to expand to 2,000 containers within five years. He said the company is on pace to make $20 million in its first year of operations.

“Produce is the last long-haul, $100 billion market that intermodal hasn’t penetrated,” said Finkbiner, who added that more than 95% of fresh produce was delivered by truck last year in the U.S.. “Trucks will get tighter. Drivers will get harder to find. It’s a migraine headache for shippers and receivers. This is an alternate long-haul capacity.”


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