Canadian Pacific Railway Ltd. (TSX:CP, NYSE:CP) and shipping line Maersk have reached an agreement to build and operate a world-class transload and distribution facility in Vancouver to expand both companies’ supply chain options.
The CP transload facility will be an expansion of CP’s existing Vancouver intermodal facility and benefit from turnkey rail infrastructure, Maersk said.
Maersk said the transload facility is designed to give customers access to a multi-commodity transload facility relying on the substantial use of rail instead of truck in the Vancouver market, as CP will shuttle containers to and from port terminals via rail.
“CP’s unique landholdings in Vancouver enable us to bring to market a first-of-its-kind transload facility that creates tremendous opportunity for sustainable growth,” CP president Keith Creel said. “Together with Maersk, the global shipping leader, we will transform intermodal transportation in North America.”
Maersk Canada president Omar Shamsie said the agreement creates for more agile supply chain options and capacity to and from Vancouver – especially as e-commerce demands further drive shipping needs.
Shamsie said Vancouver warehouse space has been tight in 2020, putting pressure on supply chain performance.
“We applied our global integrator strategy to simplify the current situation and create more end-to-end supply chain solutions by reducing multi-modal handoffs,” Shamise said. “We can now offer more responsiveness to the pace of business by giving supply chain leaders more control of order timing/fulfillment through inland routing flexibility, better velocity gained from one day savings of rail versus truck and cost savings through seamless transload operations into domestic 53-foot trailers.”
“We feel this is quite compelling to lower their year-on-year cost goals while creating a more sustainable supply chain with less truck emissions,” he said.