When it comes to “intermodal” or “transloading”, the immediate thought is truck to rail or vice versa. Maybe the idea of boxes from ship to truck or in the case of rail on dock, ship to rail comes to mind. But when thinking of intermodal rarely does the idea of rail to ship spring to the fore with one notable and unique exception — CG Railway’s rail ferry.
It’s not that rail ferry services are that unusual – they’ve been around almost since the inception of railroads themselves – generally providing vessels to ferry rail cars that cross rivers or harbors to rail connections on the opposite shore. Many of these “ferries” were simply barges with tracks and the propulsion was provided by tugboats, often specially equipped to handle the short trips. But CGR’s rail ferry service runs from the Port of Mobile, Alabama to the Port of Coatzacoalcos in Veracruz, Mexico – a 900 mile run across the Gulf of Mexico. So, not only is the service remarkable in its length, but it connects the US with Mexico, the nation’s largest trade partner (recently surpassing China) and a fellow member of USMCA (United State/Mexico/Canada) trade agreement.
Since transiting the Gulf of Mexico isn’t a mill run, the equipment is highly specialized for the task. The CGR operates two double-deck 590-foot roll-on/roll-off rail ferries, the Cherokee and Mayan, each with a double-deck capacity of 135 railcars compared to the 115 railcar capacity of the ships they replaced. (And it is worth noting that recently the Mayan set a new onboard capacity record of 154 railcars.) Each railcar has a maximum capacity of 286,000 lbs. (143 tons) in comparison to a typical 53-foot trailer’s 80,000 lbs. (40 tons) maximum load. These state-of the-art ferries are both recent purpose built additions – both the Cherokee and the Mayan were built in China at the Huangpu Wenchong shipyard and put into service in 2021 replacing two smaller carriers, the MV Bali Sea and MV Banda Sea. Besides being nearly 600 feet long, the ro/ro ships have a 120 foot beam (width), 22 foot draft and are 30,000 grt (gross registered tons). Both vessels are US flagged under the Marshall Islands registry. The twin screwed ships have top speed of 14 knots or roughly twice their predecessors. The additional vessel speed has almost cut in half the service time to two and a half days port-to-port — and a considerably better transit than the landside alternatives which can cost shippers over a week in time.
The sister ships have already made an impact as CG Railway said its traffic grew 53% last year due to the increased capacity of the new rail ferries. Araceli Cervantes, CGR’s Pricing and Marketing Manager said of the deployment, “Our primary focus remains on facilitating the expansion of our customers’ traffic, and we are happy to have both new rail ferries fully operating for over a year now.”
CG Railway’s Evolution
The CG Railway began operations in 2000 out of Mobile, Alabama and in 2004 moved its homeport to New Orleans, Louisiana. The facility in New Orleans was heavily damaged by Hurricane Katrina in 2005. Subsequently in 2007 the Alabama State Port Authority agreed to construct a unique $19 million rail-ferry terminal at the Port of Mobile and the service again began operating out of the port.
Headquartered in Mobile, Alabama, CG Railway, a Class III railroad, is a joint-venture split between Genesee & Wyoming Inc (G&W) and SEACOR Holdings. The Darien, Connecticut-based G&W is well-known for its portfolio of leased and owned shortline and regional freight railroads, — a total, of 115 railroads — which provide services to thirty major ports and boasts over 13,000 miles of trackage. SEACOR Holdings Inc. is a diversified holding company with interests in transportation and logistics. SEACOR was acquired by American Industrial Partners (AIP), a middle market equity firm, in 2021.
Intermodal is All About Connections
What makes intermodal work is the connections it facilitates. In the case of CG Rail, the connections are quite remarkable. CGR has direct interchange in the U.S. railroads with Alabama Coast Railway (AGR), Alabama Export Railway (ALE) [subsidiary of Mississippi Export Railway], Canadian National (CN), CSXT, Norfolk Southern (NS) and Terminal Railway Alabama State Docks (TASD) [connecting to Burlington Northern Santa Fe (BNSF)], Canadian Pacific Kansas City Southern (CPKCS), MSE, Union Pacific (UP) and an array of other Class 1 and short lines. And in Mexico the service connects with Ferrosur (FSRR) — connecting to Ferrocarriles Chiapas-Mayab (FCCM)/Ferrocarril del Istmo de Tehuantepec (FIT), Ferromex (FXE), Kansas City Southern de Mexico (KCSM), and Terminal Ferroviaria Del Velle De Mexico (TFVM).
The long and the short of it is that the CPR rail ferry provides a unique linking rail route between the United States, Canada, and Central and Southern Mexico.
And there are inherent advantages to the rail “sea” route for shippers. For example, one obvious advantage is that the route bypasses the congestion and delays that plague border land crossings. The customs clearance is also fast as a majority of the shipments are pre-cleared before arrival. Additionally, there is a minimal exposure to pilferage while in transit across the Gulf of Mexico. And with the railcars being stationery during the nearly 2,000 mile round trip, there is little wear and tear to the equipment reducing maintenance and mileage costs.
Although CG Rail is not widely known outside the shippers it serves and commercial relationships it has with related businesses, but that may be changing. On June 6th CG Rail was awarded an “E-Award” from the US Secretary of Commerce Gina Raimondo. The E-Award (E for Export) was established in 1961 by President Kennedy and is the highest recognition bestowed upon a U.S. entity for its remarkable contribution to expanding U.S. exports. Secretary of Commerce Raimondo said in presenting the award, “On behalf of President Biden, I congratulate CG Railway, LLC on its distinguished achievements in supporting U.S. exports, which is delivering tangible benefits for local economies, workers, and their families. The world turns to the United States for innovative products and solutions thanks in part to U.S. businesses of all shapes and sizes that export. CG Railway, LLC serves as a model that will inspire enterprises and entrepreneurs everywhere.”
The operative word in the presentation, is “innovative”. There is no other service quite like CG Rails rail ferry which begs the question. Why not? It’s an “intermodal” solution that has a proven track record. For the moment CG Railway has this intermodal niche to itself but with an E-Award in hand, the rail-ferry solution may not be flying under the radar in the future.
