Digital Edition

Sept.5, 2016

Issue link:

Contents of this Issue


Page 43 of 71

SURFACE & DOMESTIC TRANSPORTATION TRUCKING | RAIL | INTERMODAL | AIR & EXPEDITED | DISTRIBUTION 44 THE JOURNAL OF COMMERCE SEPTEMBER 5.2016 By Reynolds Hutchins CONTAINERS FILLED WITH Kia auto parts railed via a short line from the Port of Savan- nah 200 miles to the privately operated inland port in Cordele, Georgia, will allow the South Korean automaker to avoid truck capacity headaches and benefit agricultural exporters already using the facility. The new agreement highlights how Savannah and a handful of other U.S. ports are tapping intermodal rail networks con- nected to inland hubs. None is bigger in the U.S. Southeast than Atlanta, and Savannah is building on its reach to the capital of the South by forging a network that soon will include five more hubs across the state. These so-called inland ports strengthen the port's existing business and attract addi- tional shippers. According to the terms of the agree- ment announced in August, Kia auto parts that have always moved through the Port of Savannah now will reach the Kia plant by first traveling via short line rail — via the Heart of Georgia Railroad and Georgia Central Railroad — to the Cordele Inland Terminal. Those parts then will move via motor carrier to Kia's plant in West Point, Georgia, some two hours away. Through the deal, Kia will partner with Cordele to supply approximately 30,000 20-foot-equivalent units annually to the auto- maker's plant in the western reaches of the state. Some of that already is moving through Cordele, while the full portfolio should be moving through the terminal by the middle of September, Jonathan Lafevers, president and chief operating officer of Cordele Intermodal Services, told The Journal of Commerce. The anticipated volume will essentially double the amount of cargo handled at the Cordele Inland Terminal on an annual basis as well as help right an imbalance of exports and imports at the site. "Cordele has been big on cotton, peanuts and forest products. It's an export market pri- marily," said Griff Lynch, executive director of the Georgia Ports Authority. "We knew that imports were needed to make it more sustainable and lower the costs." The Kia deal also promises to take trucks off state highways, save Kia dollars and hours in transit, and launch a new import business within the state's largely export-focused Net- work Georgia inland initiative, Lynch told The Journal of Commerce last month while touting the deal at a Finished Vehicle Logis- tics Import Export summit in Baltimore. "That's always been our aspiration," Lafevers said. "We would love nothing more than to see a distribution center, or other opportunities, to come to Cordele, focused on import." Cordele Intermodal Services, or CIS, still has capacity for about 2,500 containers a month, factoring in Kia's estimated moves. "Working with our state partners, as well as our suppliers, in this way not only benefits (Kia), but also increases efficiency, which adds value to the end product, ultimately benefiting our customers," Stuart Countess, chief administrative officer at Kia's Georgia arm, said in a statement. Executives at the GPA and CIS say it also will benefit the large agricultural export base that already uses the Cordele facility with the additional capacity Kia's empty import containers will bring. In addition, Georgia hopes Kia's decision encourages other importers to consider tapping the state's inland port network. "Imports will now naturally f low through Cordele, Kia pools any containers they may need, and they return their emp- ties to Cordele," Lynch explained. "There's a lready more interest from the export side to use the rail option." The Kia deal is expected to take approxi- mately 6 million truck miles off Georgia highways, one of the primary motives behind the state implementing the Network Georgia initiative. "It feeds into Network Georgia. It's a great concept, matching imports with exports," Lynch said. It's taken three years for the Cordele operation to reach an import-export equi- librium, and it will take years to come before the full scale of Network Georgia is realized. "We've been careful to grow the business at Cordele and do it in stages and not take on too much at one time," Lafevers said. It's as much about rightsizing operations, as finding sustainable business partners like Kia. Network Georgia divides the state into six primary regions: southwest, northwest, middle, port Atlanta and Interstate 95 Cor- ridor north and south. The plan is to have an inland facility in all six regions in the next five to 10 years, according to the state. Growth has exploded at the Cordele operation since it struck its first agreement with Georgia. What started in 2013 as a 3,500-container operation is now moving 2,000 to 3,000 loaded containers each month and handled 25,000 containers in fiscal 2016, which ended June 30, according to Lafevers. Cordele was the first piece of the puzzle, but there have been limitations there, given its private business structure and its finite access to capital. The Appalachian Regional Port in Chatsworth, which will receive public fund- ing, is the "second piece of the pie," Lynch said. The new port in northwest Georgia was announced in July 2015 in a tri-party agreement among the state, the GPA and CSX Transportation. The GPA will operate the terminal, which is expected to open in early 2018, Lynch said. At its July board meeting, the GPA approved a $19.7 million spending package to construct the new inland facility. Unlike Cordele, but similar to the inland port in neighboring South Carolina, the GEORGIA'S INLAND FEEDING FRENZY A new Kia deal brings an import and intermodal aspect to the state's inland port network

Articles in this issue

Links on this page

Archives of this issue

view archives of Digital Edition - Sept.5, 2016