Canadian Pacific Railway says it has begun phasing in a rail capacity allocation system to better manage growth in the import container business on Canada’s west coast.
CPR said its rail network has been operating smoothly for several months after dealing with an extraordinary increase in traffic volumes, but said the time is right to implement a system that will "bring discipline to the
traffic flow and avoid the significant surges that create congestion in the supply chain."
Under the new system, CPR will allocate to each of the shipping lines it serves an annual import container volume through the Vancouver Gateway based on past volumes and growth projections. CPR will supply sufficient railcars to meet the allocated volume. Intermodal terminal operators will commit to quick turnaround of railcars to maximize car availability. The allocation system is being phased in through June.
“This is a critically important part of a more disciplined and orderly approach to the integrated logistics system,” said Fred Green, CPR’s Executive Vice-President, Operations and Marketing.
“It encompasses shipping lines, ports, and terminal operators, as well as customers that trans-load import shipments into domestic containers.”
CPR developed its allocation system after consultation with shipping lines and the port over the past month. “Everyone in the integrated logistics system wants business to grow, but growth must be managed for maximum
effectiveness for all parties,” said Green. “No logistics system can accommodate significant unplanned volume increases like those that exceeded system capacity in the first quarter this year.”
CPR said it moved 24 % more international containers through the Vancouver Gateway in first-quarter 2004 than in the same period of 2003.
The sudden surge in container volumes in late 2003 and early 2004 caused bottlenecks and container backlogs at U.S. west coast and Canadian ports.
“We need a concerted, co-operative approach that builds confidence with our shippers that the service they are provided is consistent and reliable," said Green.
As part of CPR’s commitment to maintain the Port of Vancouver as the key gateway to heartland Canada, a CPR-Gateway joint stakeholders meeting will be held in Vancouver the latter part of August.
Green said CPR is doing everything it can to create solutions to the growing demand in Canada, including targeted track expansion.
“However, in the absence of a regulatory and tax environment in Canada that supports large-scale infrastructure expansion, disciplined control systems are required. Without a positive change in the legislative environment, infrastructure expansion will be an increasingly critical issue for Canada’s
economic growth,” he said.
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