Freight railroads are positioning themselves to handle additional traffic related directly and indirectly to the Panama Canal expansion, Association of American Railroads President and Chief Executive Officer Edward Hamberger told a U.S. Senate committee yesterday.
Testifying before the Senate Committee on Commerce, Science and Transportation, Hamberger said the Panama Canal's expansion will impact each North American railroad differently, but the industry will be ready to handle the intermodal traffic growth, whether it comes from the East or West.
"Our nation's freight railroads are in a good position now and are working diligently to be in an even better position in the future to offer the safe, efficient, cost-effective service that their customers at ports and elsewhere want and need," said Hamberger in a statement issued after his testimony.
The $5.3 billion Panama Canal expansion is scheduled to be completed in 2015. The committee hearing was held to gather information on the potential impact an expanded canal would have on freight movements into and throughout the United States.
Hamberger noted that rail intermodal shipments are growing as a result of major investments freight railroads have been making in equipment, facilities and infrastructure. Those investments include $25.5 billion spent in 2012, and about the same amount is budgeted for this year. Meanwhile, intermodal volume has increased from 3.1 million containers and trailers in 1980 to 12.3 million units in 2012, Hamberger said.
"Intermodal-specific investments are part of the $525 billion in investments freight railroads have made since 1980 — paid for with the railroads' own funds, not government funds — on locomotives, freight cars, tracks, bridges, tunnels and other infrastructure and equipment," he said.
Many analysts project demand for freight transportation will grow for intermodal trade and domestic resources as a result of population and economic growth, which further supports the need for investments in rail intermodal and carload capacity, Hamberger added.
"Railroads are the best way to meet this demand," he said.
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