News & Updates: Port Bureau News: November 2019

Railroad Reconsidering Local Strategy

Thursday, December 12, 2019  
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By Patrick Maher, Gulf Winds International, Inc.

Railroad Stops Serving Barbours Cut

Earlier this spring, Union Pacific Railroad eliminated intermodal rail service between Barbours Cut and Dallas. This route was among several that were eliminated in the network, because of precision scheduled railroading (PSR). PSR is a railroad strategy that uses departure schedules and point-to-point delivery methods to achieve low operating ratios and to consolidate railroad networks. PSR has grown in popularity, already being implemented by several of the Class 1 railroads over the last year.

The Barbours Cut to Dallas/DIT routing had been in service for several years, providing additional capacity for the growing Houston container trade market to DFW, a major distribution hub. Largely seen as a positive attribute, the rail service had provided a practical alternative to roundtrip trucking of containers.

Trucking Remains the Most Reliable

Trucking capacity is always challenging on the Houston to Dallas corridor, competing with commuter traffic, road construction delays, and other issues related to moving freight within, and between, two of the fastest growing population centers in the U.S.

Shippers continue to increase their Gulf Coast import routes through Houston as a natural alternative to shipping to West Coast ports and moving cargo by rail to DFW. According to Transport Topics, Port Houston’s September TEU numbers were up 9.2% to 251,524, compared with 230,331 a year ago. In addition, the Houston facility ran 10.9% ahead of last year’s record pace, having processed 2,231,699 TEUs through the end of September, compared with 2,011,187 of September last year.

However, despite growing market capacity, Union Pacific quietly struggled to fill one train per week. With only one service per week, a shipper would often have to wait 4-6 days to catch the next train moving northbound. The transit time alone was 2-3 days, plus an additional 1-2 days to pick up and deliver in DFW. Therefore, a single movement could take 5-6 days, or even over 7 days, in some cases. With this time lag, many shippers chose to utilize trucking services rather than the train to move their freight. Without enough volume for an additional train, service suffered, and the route was ultimately cut.

Gulf Winds Fills the Vacuum

Over the last 25 years, we have invested heavily in port related infrastructure, and technology, to meet the needs of our customers in the Houston region. When the Barbours Cut to Dallas/DIT routing ended, we increased our over-the-road fleet by 20 percent.

We chose to grow by expansion instead of acquisition, to preserve the values and services our customers trust and depend on. As a result, we recently expanded of our Bayport footprint to approximately 500,000 square feet of cargo handling space which increased our total investment in both Barbours Cut and Bayport to 1.5 million square feet, and we continue to invest in chassis with the ownership of over 1,300 in Houston.

Gulf Winds is redefining expectations for intermodal trucking through continuous investment in innovation, people and purpose. These are both exciting and challenging times for our industry. Our commitment is to continue to listen, innovate, and execute solutions for our partners.

 About the Author

Patrick Maher is Executive Vice President at Gulf Winds International, Inc.  As a member of the Executive Team, he is responsible for leading the Business Development and Marketing organization. Patrick is a graduate of Louisiana State University, with a B.S. in Finance.