This has been a winning strategy in the past for BNSF and other Class I rails. I am reminded of the Centerpoint facility near Chicago, which provides BNSF a transfer point in the Midwest. But Centerpoint was developed with money from investors, CalPERS being the largest. BNSF hopes to be the prime developer in Barstow, CA.
In case you don’t know where that is, Barstow is in the middle of the Mojave desert, 132 miles from the Port of LA (about 2 hr 27min as I look at Google Maps). It is right on I-15, the main route the movie stars take to go to Las Vegas from LA. Parts of it around San Bernardino are already traffic jams at many hours. However, the BNSF vision is that containers from the port will move by train, reducing traffic on I-15 and other LA freeways.
The Alameda Corridor already moves containers inland a good 20 miles. It’s a double-stack double-track route. BNSF will ensure good rail service from the Barstow yards to the ports.
Transloading and distribution warehouses will be built near Barstow on the BNSF complex. I believe BNSF sees this as a good real estate play as well as a plan to improve container rail service.
I am wondering if the plans for Barstow include customs processing. If so, that would be good for both imports and exports, because they would not have to wait for customs on the ports. That would aid in reducing port congestion.
Unions have reached a deal with rail lines on a contract for the next five years.
There will be a 24% wage increase over the next five years, with 14.1% immediate, and five payouts of $1000 per worker.
The terms are along the lines recommended by the Presidential Emergency Board (PEB). The board was appointed to prevent workers from striking for 30 days while the disputants continued talking, and to make recommendations for a reasonable settlement.
This agreement should provide a framework for the additional unions that have not reached agreements yet.
It’s good to know that it’s likely there will not be a rail strike this fall to disrupt supply chains that use rail. We have enough disruptions now, and need to get back to something approaching normal in the rail industry.
Rail is currently viewed in the US as one of the major factors in port congestion today. The rails claim that they have labor shortages. The increased salaries might help them keep and recruit workers. The other factor is work load, and that will be determined by the interaction between the union workers and the management at the rail locations throughout the country.
It is interesting to hear about changes in regional supply chains. The Ukraine war provides a chance to see what disruption occurred and how it is impacting routes to move cargo in the area of the Black Sea. This article covers the effects of the blockade of Ukranian ports.
Naturally costs have changed, and so have equipment imbalances.
Finally, the markets for freight into and out of the area have changed a lot. Many shippers and carriers have been actively looking for alternatives, and have needed to create some new ones.
And sanctions imposed by the EU and US have forced other changes.
By Daniil Melnychenko data analyst at Informall BG 26/07/2022