SURFACE & DOMESTIC TRANSPORTATION
TRUCKING | RAIL | INTERMODAL | AIR & EXPEDITED | DISTRIBUTION
44 THE JOURNAL OF COMMERCE www.joc.com 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
