(Canadian Transportation & Logistics)
Weaknesses in the US rail network have been exposed this year even as the country experiences record freight volumes.
According to a Financial Times report, Roger Nober, the
chairman of the US Surface Transportation Board, the US rail industry regulator, said 21st century freight flows are being streamed into a 19th century network.
Some 40 % of all US freight is carried by rail, a
figure projected to double in the next 20 years. Record volumes are being driven by demand for US commodities such as coal, suggests the report.
In cities like Chicago, where over a third of US rail freight
passes, the problem is severe, especially since the six biggest North American railroad companies' networks intersect there.
Chicago's rail yards however were built to accommodate trains no longer than 3,000ft.
Today's locomotives drag trains of wagons that stretch up to 8,000ft - almost two miles.
Fred Green, executive vice-president of operations and marketing for Canadian Pacific Railway, which runs two lines in the
US, said in the report that though railroads have bought extra locomotives and hired staff to cope this year's record harvests, railroads can no longer absorb the surge in
demand.
The rail industry cannot
invest on a large scale, with cost of capital at about 9.4 per cent, and return on invested capital at only 6.8 per cent.
Rail experts suggest a solution that is a combination of getting costs down and freight
rates up, perhaps involving port authorities, rail customers and others.
Chicago, meanwhile, is undertaking a $US 1.6 billion six-year public-private partnership project in track modernisations funded jointly by
railroads, the city,
Illinois and the US government. This, however, is pending the approval of $900m in federal government funds under the latest Transportation Authorization Bill. |
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