OceaNS intermodal service targets freight moves from east to west
7/13/2022
By Grace Renderman, Associate Editor
A new joint intermodal service led by Norfolk Southern Railway has forged a new international route for Europe-originating freight destined for the western United States.
Launched June 8, the OceaNS Bridge Express project is a joint venture featuring NS, Union Pacific Railroad, the Port of Virginia and European container shipper Hapag-Lloyd. Cargo originating from Italy and Spain travels across the Atlantic to the Port of Virginia, and from there is expedited to Chicago via double-stacked NS trains. UP interchanges with NS in Chicago to deliver the freight the rest of the way to the West Coast via Los Angeles and Oakland, California.
The Hapag route — called the Mediterranean Gulf Express — replaces the ocean shipper's previous Mediterranean Pacific Service that went directly to California.
OceaNS Bridge Express grew out of customers’ desire for a fast and efficient alternative route that would skip congested western U.S. ports, avoid the Panama Canal and provide a more environmentally friendly trip, says Jonathan Beltran, NS’ director of international intermodal.
“We've seen in the last few years in the supply-chain ecosystem that freight gets backlogged … at ports, on water, at destination [and] truck-side,” Beltran says. “So, this offers an opportunity for Hapag to leverage their new service rotation to discharge freight to Virginia and efficiently move the freight via rail out to the West Coast.”
Hapag-Lloyd is NS’ largest international intermodal customer and the port is the railroad’s largest rail partner on the East Coast. Hapag-Lloyd has a weekly shipping rotation service to the port.
The Hapag route — called the Mediterranean Gulf Express — replaces the ocean shipper Hapag-Lloyd's previous Mediterranean Pacific Service that went directly to California. Port of VirginiaOceaNS Bridge Express aligns with NS’ intermodal strategy to transfer freight cross-country with the most efficient level of communications and planning, Beltran says. It also follows the Class I’s newly minted TOP|SPG (Thoroughbred Operating Plan|service, productivity and growth) initiative aimed at fostering better connections across its network. UP in particular was chosen as an OceaNS Bridge Express service partner because UP is a large, established partner across commodities, Beltran says.
Through OceaNS Bridge Express, freight will move on a consistent and reliable basis compared to shipping over water, NS officials say. After witnessing months of congestion at the western ports — such as in Los Angeles and Long Beach — NS officials believed they could create a better “bridge” over which to deliver cargo so customers could avoid barges being stuck offshore for a long time, Beltran says.
The Port of Virginia is one of the least congested ports on the East Coast, making it an ideal partner to receive cargo to move to rail straight from the water, he says.
“[The port’s] leadership group and our leadership team have been very close for many years. On innovative solutions like this, they've always ... been creative,” Beltran says.
The port will serve as a “rail gateway,” says Tom Capozzi, chief sales and marketing officer for the Virginia Port Authority’s private terminal-operating subsidiary Virginia International Terminals. The Virginia International Gateway terminal is semiautomated, allowing for faster processing of containers, while the Norfolk International Terminals (NIT) — the VPA’s largest terminal — is partially semiautomated.
Plans to invest $650 million into the northern half of NIT are in the works now, Capozzi says, with completion expected in 2025. The funds would pay for new ship-to-shore cranes, a reconfiguration of the container stack yard, the purchase and installation of rail-mounted gantry cranes and a reconfigured queuing system for motor carriers. The figure also includes the cost of demolition, technology overlay and other infrastructure expenses, said port spokesman Joe Harris in an email. The project design is 60% complete.
“The semiautomated terminals [have] really benefited us to be able to provide flexibility ... and make sure that we're processing those containers very effectively,” Capozzi says. “That's what's given us the edge out there in the marketplace, and I think that's one of the reasons why Hapag-Lloyd chose to come here.”
Through its partnership with NS, the port hopes to expand access to western markets where it doesn’t have much presence. The port’s largest intermodal destination hub is Chicago, and it’s active in other Midwestern markets such as St. Louis and Kansas City, Capozzi says.
The port is in the process of building a rail yard that will have an annual capacity of 260,000 container lifts. It’s slated for completion in 2023, at which time the port would gain an annual capacity of 1.1 million lifts. The goal is for all cargo being transported through the service to be taken off a barge, processed and loaded onto a train within 48 hours of arrival, so dwell time is reduced. Average dwell time for NS-destined cargo now is 36 hours, Capozzi says.
“The fact that we do have on-dock rail facilities at both marine terminals, that's key. It's very difficult to be able to provide a reliable service where you have to dray boxes across town in large numbers," says Capozzi. “Us being able to do that and control the entire operation within our own terminal ... really helps to drop down dwell time, because we can transfer straight from the berth to the train.”
