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Rail Freight Makes Big Advances

Developments on three continents spotlight the growing role of rail in global logistics.

By John McCloud | Updated on October 15, 2008

Developments on three continents spotlight the growing role of rail in global logistics. Increasing numbers shippers, suppliers and retailers are looking at rail as a cheaper and more efficient alternative to container ships and trucks for long-distance freight transport.

In North America, the US Surface Transportation Board granted Canadian Pacific Railway regulatory approval for it’s estimated $1 billion acquisition of the Dakota, Minnesota & Eastern Railroad Corp. The acquisition was initiated in September 2007 but delayed a full year due to opposition from US political interests. The purchase, which received final approval Sept. 30, includes the Sioux Falls, SD-based companies two subsidiaries: Iowa, Chicago & Eastern Railroad and Cedar American Rail Holdings.

The DM&E, which connects with Canadian Pacific at Minneapolis, Winona, MN and Chicago, is the largest regional railroad in the US and the only Class II railroad that connects and interchanges traffic with all seven Class I railroads. It serves eight states, including Illinois, Iowa, Minnesota, Missouri, Nebraska, South Dakota, Wisconsin and Wyoming. In addition to Chicago and Minneapolis, it provides access to Kansas City and key inland ports. The railroad has 2,500 miles of track, including approximately 500 miles of trackage rights, and rolling stock consisting of 7,200 rail cars and 150 locomotives. The acquisition enables Canadian Pacific to get containers more quickly and efficiently from the ports of Vancouver and Prince Rupert, BC to the central US.

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