October 6, 2023

UP to offer intermodal service linking Mexico, US Southeast


Add Union Pacific to the list of Class I railroads seeking a better link for customers between the U.S. Southeast and Mexico.

The western U.S. Class I railroad announced this week that it will be offering intermodal service that originates on Mexican rail carrier Grupo México from both Monterrey in Nuevo Leon and Silao in Guanajuato to cities in the southeastern U.S.

The intermodal service is targeted for domestic freight within North America that doesn’t come from the ports, UP told FreightWaves. As such, the service is for those using 53-foot domestic containers.

An illustration from Union Pacific’s website highlighting the new service.

“In tandem with our diverse customer base, including our private asset and rail container channel partners, this new service introduces the largest influx of intermodal capacity for the Southeastern U.S. market out of Mexico,” UP (NYSE: UNP) said. “It also reinforces Union Pacific’s steadfast commitment to serving Mexico markets, helps take trucks off congested highways, and offers customers a complete transportation solution for business traversing this key trade corridor.”

A chart from UP’s website showing transit times between the two regions.

UP’s offering follows remarks by executives from Norfolk Southern (NYSE: NSC) and CSX (NASDAQ: CSX) at an investor conference in August, in which both companies expressed interest in beefing up service between the markets in Mexico and the southeastern U.S. CSX and Canadian Pacific Kansas City (CPKC) have plans for a new direct interchange connection in Alabama via acquiring or operating portions of the Meridian & Bigbee Railroad, which operates in Mississippi and Alabama and is owned by short-line operator Genesee & Wyoming (G&W). G&W, CSX and CPKC (NYSE: CP) announced their plans in late June, saying the change would establish a new freight corridor connecting Mexico, Texas and the U.S. Southeast. The plans need approval by the Surface Transportation Board.

Meanwhile, NS has a relationship with CPKC in which shippers can utilize the Meridian Speedway to go between Texas and Mexico and the Southeast. NS also has its own service products, including those that involve partners J.B. Hunt and Hub Group.

September also saw a slew of announcements from Class I railroads about expanded intermodal services across national borders, including enhanced service between the U.S. Midwest and Mexico.

All of these new or expanded services follow April’s merger between Canadian Pacific and Kansas City Southern.

Nationwide, loaded domestic intermodal has picked up seasonally in the past month, according to this SONAR chart. (FreightWaves SONAR) To learn more about FreightWaves SONAR, click here.

UP said it shaved off one day of transit time in the Falcon Premium service that it offers alongside Canadian railway CN (NYSE: CNI) and Grupo México, while NS said it would be working with Florida East Coast Railway to better connect those seeking to do business in Florida with markets in the Midwest and western U.S. NS also said it would partner with CN to launch a intermodal service that they say will allow customers in CN-served markets in Canada and the Upper Midwest to access markets in the U.S. Southeast.

Subscribe to FreightWaves’ e-newsletters and get the latest insights on freight right in your inbox.

Click here for more FreightWaves articles by Joanna Marsh.


The second annual F3: Future of Freight Festival will be held in Chattanooga, “The Scenic City,” this November. F3 combines innovation and entertainment — featuring live demos, industry experts discussing freight market trends for 2024, afternoon networking events, and Grammy Award-winning musicians performing in the evenings amidst the cool Appalachian fall weather.

Source link
In this article:
Share on social media: