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Berkshire Hathaway’s BNSF Railway is gearing up to accommodate the rising intermodal volume through West Coast ports following the announcement of tentative contract agreements by the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA). This development sets the stage for an exciting new chapter in the future of West Coast ports, and BNSF has made substantial investments over the past few years to prepare for the immediate and long-term growth potential in the intermodal segment, which happens to be their largest segment.
Katie Farmer, President and CEO of BNSF, expressed her enthusiasm, stating, “We are beginning an exciting chapter in the future of the West Coast ports, and BNSF has made key investments over the past several years in preparation to support both immediate and long-term volume growth for intermodal, our largest segment with the most growth potential.”
BNSF has spared no effort in expanding its capacity and enhancing its infrastructure. Since 2019, the company has invested over $2 billion in capital expansion, with a focus on increasing the overall capacity of tracks, railcars, and facilities. These investments have resulted in the addition of 58 miles of main line track capacity, approximately 30,000 feet of new production tracks, and around 6,000 new parking spaces at BNSF intermodal facilities. Moreover, BNSF is actively incorporating new technologies to enhance consistency, capacity, and customer experience.
Tom Williams, Group Vice President of Consumer Products at BNSF, elaborated on their strategic approach: “We’re creating an integrated intermodal network, both physically and digitally to ensure we are a supply chain partner of choice into the future.”
To facilitate the increasing intermodal volume, BNSF has recently expanded capacity at its intermodal facilities on the West Coast. They have augmented the parking capacity at their Los Angeles intermodal facility by 500 spaces and implemented new crane stacking technology. Additionally, they have enhanced transloading capacity in the Seattle region. Furthermore, BNSF is actively working on a multi-year project to improve efficiency at its San Bernardino intermodal facility in the Inland Empire. To address potential service disruptions, BNSF has positioned 100 locomotives as a “ready fleet” across the West Coast and other strategic network locations.
BNSF has also focused on expanding capacity and capabilities at its inland intermodal facilities. Notable projects include the addition of 3 miles of production tracks, over 2,000 parking spaces, and a new multi-lane ingate at the BNSF intermodal facility in Alliance, TX. Similarly, at Logistics Park Chicago (LPC) in the greater Chicago area, BNSF has leveraged remotely operated cranes to maximize capacity and improve throughput, gaining 18 hours of productivity each day. They have also expanded parking capacity by approximately 20% through ongoing expansion work at the BNSF Cicero intermodal facility. BNSF has secured an additional 2,000 parking stalls in secondary locations near its intermodal facilities to accommodate volume surges effectively.
Looking ahead, BNSF has planned several critical projects for 2023. They are currently working on adding approximately 45 miles of triple track between Barstow and Needles, CA, with about 30 miles expected to be completed this year. Furthermore, a 50-mile double track segment in Kansas is nearing completion, closing one of the last major single track sections on the Southern Transcon, which connects the West Coast to Chicago. BNSF has also initiated the construction of a new second main track bridge over the Missouri River at Sibley, a significant project expected to span the next couple of years. These developments will not only enhance transit times and consistency but also improve BNSF’s ability to handle seasonal volume fluctuations across the Southern Transcon.
In addition to infrastructure investments, BNSF is actively deploying new technologies to improve consistency, capacity, and customer experience. They are enhancing their driving interface app RailPASS and implementing a new pickup appointment system for stacked units at LPC, slated to launch in the fourth quarter of 2023. These innovations aim to reduce dray drivers’ time spent in facilities and improve overall efficiency. BNSF is also leveraging various technologies to optimize unit loading and de-ramping, improve inventory accuracy, and enable real-time tracking of shipment parking locations. These efforts will contribute to a seamless driver pick-up experience and enhance train loading efficiency.
With an array of measures in place to boost network fluidity, velocity, and capacity, BNSF is well-prepared to handle the increased demand through West Coast ports. Their commitment to meeting customer service expectations and their continued investments in infrastructure and technology position them as a reliable and efficient supply chain partner in the future.
© 2023 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.