so you want to ship by rail?
DESCRIPTION
Presented by Grace Kung, BNSFTRANSCRIPT
Rail 101&
Economic Development
Grace KungRegional Economic Development Mgr
April 24, 2012
Replaced title typeand photoBNSF Railway Company
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Agenda
Industry OverviewBNSF OverviewWhy Rail?Why Economic Development?
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Rail Industry Overview
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Industry Overview
America’s Railroad Industry
U.S. railroads operate over 140,000 miles of track and earn an aggregate freight revenue of nearly $57 billion
In the United States, railroads account for more than 40%* of all freight (more than trucks, boats, barges or planes) *Measured in Ton Miles
70% of all autos produced in America move by rail 30% of all U.S. grain moves by rail 65% of the coal is moved by rail which in turn produces half of
America’s electricity U.S. Railroads move enough:
Wheat to provide every person with a loaf of bread 6 days/week Concrete to build 45 miles of new highway every day
Railroads remain the backbone of America’s freight transportation network
North American railroads form the world’s most efficient and lowest-cost freight network
Source: American Association of Railroads (AAR)
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Industry Overview A key link in the U.S. Supply Chain
71% of America's GDP is driven by the consumer
Seamless network of manufacturers, retailers, distributors, transporters, storage facilities and suppliers
Rail delivers everything Americans consume everyday:
Cars and Combines
Clothes and Shoes
Stereos and TVs
Food and Water
Lumber and Steel
Energy and Fuel
… many others, such as bread and cereal
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Industry Overview
Types of Railroads
Class I • Annual revenues in excess of $340M• Operations range from 3,200 to 32,000
miles• Typically concentrate on long-haul, high-
density intercity traffic lanes• Seven Class I railroads in North America
Regional• Operate at least 350 miles of track • Earn $40 million or more in revenues• 33 Regional railroads
Local Linehaul• Operate less than 350 miles of track• Generate less than $40M in operating
revenues• 324 local linehaul railroads
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Industry Overview
North America Rail Network
BNSFCNCPCSXNSUPFXE
Over 160,000 miles of track
Over 165,000 railroad employees
BNSF operates more than 32,000 miles of track
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ChallengesChallengesHighway Congestion
Driver Shortage
Fuel Efficiency
Rail Capacity
Environmental Solutions
Industry Overview Transportation Industry Challenges
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Industry Overview
Governing Bodies of The Rail Industry
• Association of American Railroads (AAR)
• Department of Transportation (DOT)
• Federal Railroad Administration (FRA)
• The Surface Transportation Board (STB)
• U.S. Customs
• Various State and Municipal Agencies
• Dept. of Homeland Security
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BNSF Overview
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BNSF Overview
“This is BNSF”
Video: “This is BNSF”
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Our vision is to realize
the tremendous potential of
BNSF Railway by providing
transportation services that
consistently meet our
customers' expectations.
BNSF Overview Our Vision
BNSF Overview BNSF Network
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BNSF Overview BNSF: Size and Scope
32,000 route miles in 28 states and two provinces
Approximately 5,800 locomotives and 208,000 freight cars
Employs approximately 38,000 people
Operates an average of 1,400 freight trains per day
Moves one fourth of the nation’s rail freight
Serves all major ports on the West Coast and Gulf of Mexico If stacked end-to-end, all the intermodal loads shipped with BNSF
in one year would reach from Los Angeles to Shanghai 6 times.
Leads rail industry in technological innovation
Has one of the largest computer systems in the world to manage our network operations 24 hours a day
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BNSF Overview Business Unit Breakdown
INDUSTRIAL PRODUCTS CONSUMER PRODUCTS
AGRICULTURECOAL
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BNSF Overview Industrial Products Breakdown
Building Materials
LumberWallboardBricksRoofing Materials
Plastics
PVCPolypropylenePolystyrenePolyethylene
Chemicals & Waste
AcidsIntermediatesCaustic SodaMunicipal Waste
Minerals
AggregatesCementClaySand
Food & Beverage
Beer & WineCanned GoodsFrozen Fish / Meat Vegetables
Machinery
Construction EquipmentFarm EquipmentTransformersGenerators
Metals
PipeSheetStructuralScrap
Petroleum Products
Diesel FuelBiodieselAsphaltAlcohols & Solvents
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BNSF Overview Carload Solutions – Direct Rail
Carload Service – Rail transportation for single or multiple carloads
Direct connection into supply chain
Excellent for multi-truck quantities of commodities such as canned goods, steel, lumber, paper, etc. (3+ truckloads per car)
Direct Rail - Primary access to the BNSF Network directly to/from a customer facility
Unit Train Service – Trainload movements of freight from same origin and destination carrying a single commodity
Most efficient service Achieves optimal network velocity
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BNSF Overview Carload Solutions - Transload
Value – Added Services Cross docking Storage and forward storing Load consolidation Inventory management
Transload – Access to the BNSF carload network at the most advantageous points through premium providers
Advantages Rail accessibility without a large capital
investment Access to numerous value-added services
To learn more: http://www.bnsf.com/customers/how-can-i-ship/door-to-door-transload/
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BNSF Overview Consumer Products Breakdown
Domestic and International Intermodal
ClothesShoesPersonal AccessoriesBeauty ProductsFurnitureElectronicsGroceriesHome Décor ItemsSporting Goods
Automotive
VehiclesParts
Office ProductsSeasonal ProductsPaper ProductsToysBicyclesHousehold AppliancesPet ProductsBooksSchool Supplies
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BNSF OverviewIntermodal Services
Premium Container Service
International and Domestic Sustainable solution to price sensitive shippers Averages 400-500+ miles per day* Competitive daily schedules
Expedited Trailer Service
Domestic Only Fastest intermodal service in the industry Averages 700+ miles per day* Ideal for time-sensitive freight
*Measurement derived from cutoff at origin to availability at destination
Service schedules can be found at http://www.bnsf.com/bnsf.was6/siisweb/cntrl
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BNSF Overview Ag Breakdown
Grain
WheatBarleyCornSoybeansMilo
Bulk Foods
SweetenersSyrupsAnimal ProductsStarch
Other Grain Products
OilsFeedsFlourSpecialty GrainsOilseeds & MealsMalt
EthanolFertilizer
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BNSF Overview Coal Breakdown
Coal
Low Sulfur Coal (Powder River Basin)
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Why Rail?
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Why Rail? Key Benefits
Fuel Efficiency – On average, railroads are three or more times more fuel efficient than trucks.
Highway Gridlock Reduction – A typical train takesthe freight equivalent of several hundred trucks off our highways.
Cost Efficiency – In general, shippers pay less for shipping freight via rail, rather than other forms of land transportation.
Environmental Friendliness – The EPA estimates that for every ton-mile, locomotives emit roughly one-third the amount of nitrogen oxides and particulates.
Source: AAR
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Why Rail? Fuel Efficiency
Trains move one ton of freight
an average of 495 miles on a single
gallon of diesel fuel, compared to
140 miles for a truck
Freight trains have increased their
fuel efficiency by 80 percent in the
last 25 years
If just 10 percent of the freight that currently moves by truck were diverted to rail, fuel savings would exceed one billion gallons a year
Oil Prices(WTI EST - $/BARREL)
Source: Global Insight--February 2008 Forecast and AAR
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50
60
70
80
90
100
200
5Q1
200
5Q3
200
6Q1
200
6Q3
200
7Q1
200
7Q3
200
8Q1
200
8Q3
200
9Q1
200
9Q3
201
0Q1
201
0Q3
201
1Q1
201
1Q3
Baseline Pessimistic
Why Rail? Rail is 2-8 times more fuel efficient than trucks
Coal
Ag
Indust. Prod.
Intermodal
*Based on a 1,500 mile truck haul
8.2x
5.5x
4.3x
2.3x
Why Rail?
Railroads can help reduce highway congestion
BNSF is the largest intermodal carrier in the world
Each year, BNSF moves about 4.6 million containers and trailers
One BNSF intermodal train removes more than 280 long-haul trucks from our nation’s highways
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Why Economic Development?
Economic Development:
Shipping Options: Transload Facility
Quickest Method Lease an existing track (private or rail Owned)
Timeline maybe an issue Rehab an existing track
Can be costly if a new switch is necessary New track construction
Can be an expensive project
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Economic Development:Transload Option
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Economic Development:
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Economic Development: Ship by Rail: 3 Simple Phases
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Economic Development: Ship by Rail: 3 Simple Phases
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Economic Development: Ship by Rail: 3 Simple Phases