Canadian Pacific Railway and the Fraser River Port Authority (FRPA) have formally agreed to work together to move goods in and out of Western Canada faster - and lobby federal, provincial and regional governments for more transportation infrastructure.
The railway and port operators have signed a memorandum of understanding (MOU) whereby they pledge to co-ordinate investments in new transportation projects to handle increased container traffic that will result largely from the rapid expansion of China's economy.
They will also participate in multi-modal planning aimed at new or expanded terminal and rail infrastructure, and consult each other on market and trade outlooks for bulk and general cargo, container traffic and automotive (i.e. truck) traffic, and business development opportunities.
"We know that the chain is only as strong as its weakest link - if one of them fails, we all fail," said Rob Ritchie, CPR's president and chief executive officer, during a signing ceremony at the port's Surrey docks last week.
|File photo by Larry MacDougal, Business Edge|
|President/CEO Rob Ritchie is overseeing CPR's improvements to its rail links to the West Coast.|
The MOU comes as the CPR is wrapping up a $160-million expansion of its western track corridor between Saskatchewan and Vancouver, which is aimed at alleviating port congestion. Ritchie said all industries have to work together in the supply chain and prepare for future freight traffic increases.
Traffic at B.C. seaports is expected to increase between five and seven million twenty-foot-equivalent units (TEUs) from two million by 2020. But many businesses are already complaining about bottlenecks that have resulted in lengthy delays on shipments.
The problem hit home last summer during a wildcat truckers strike that left containers sitting on Vancouver-area docks for several weeks.
Transportation industry insiders - from Vancouver Port Authority CEO Capt. Gordon Houston to small business operators who depend on timely shipments of goods to remain competitive - have called for new facilities and a comprehensive ports strategy designed to move more goods quickly.
But Ritchie and Capt. Allen Domaas, FRPA president and CEO, say their agreement - which is sketchy and contains few specifics and no timelines - does not necessarily mean the two organizations will invest jointly in new transportation infrastructure.
The railway and port have also pledged to ensure that goals are achieved on a fully commercial basis, without unnecessary government regulation, while they participate in multi-modal planning aimed at new or expanded terminal and rail infrastructure, co-ordination of investments and achieving regulatory approvals.
Domaas said the MOU is ultimately designed to achieve "a new culture of integration" by finding a new way of doing business together.
"The way policy has been set up, it's been focused on modes," Domaas told reporters. "The railways have looked at the rail mode and we've looked at the marine mode and it's only been in the last three years that the flood of cargo coming out of the Orient has really hit us all ... We suddenly realized that we had to have dialogue that yields results."
The MOU also calls for the railway and port to advocate common positions before government.
Ritchie challenged transportation industry players to pressure Ottawa to provide more transportation funding now that the CPR and FRPA have signed their deal.
"We have not done, I think, as a transportation industry, a good job of providing public awareness," said Domaas. "We've been so locked up into lumber and mining that transportation is real value."
Ottawa has already committed $590 million to transportation infrastructure in Western Canada as part of its Gateway initiative designed to meet growing Asian demand. Ritchie and Domaas are also calling for the construction of more roads to deal with increased container-truck traffic.
The CPR and Vancouver Port Authority have a similar MOU. Ritchie said the railway may sign a similar agreement with the Port of Montreal.
(Monte Stewart can be reached at email@example.com)