Watco Perishable Express – Midwest Association of Rail Shippers July 17, 2018 Customer First – Safety Always! 1
Agenda • Quick (I promise) Watco Overview • Existing perishable supply chain issues • Perishable Express supply chain • Questions/Discussion
Customer First Foundation Principles Customer First - Safety Always! Value Our Customers Earn their business every day by providing Safe, Accurate, and • Timely Service Create solutions that deliver value for our Customers and Watco • over the long-term Value Our People SAFE Service, ALWAYS • Be Honest and Fair • Safely Improve Every Day Always do the right thing and always try to find a better way • Build a tremendous future by making decisions that protect our • Customer, Team, Community, and Environment Customer First – Safety Always! 3
Watco Overview Geographic Diversity We operate 38 railroads, 31 mechanical shops, 87 terminal and port operations, and 31 switching locations in 37 States, 1 Canadian Province, Australia, and Mexico. Customer ♦ Commodity ♦ Geography ♦ Service 4
Watco Overview Unique Services Offering Transportation Services Terminal and Port Services 53% of 2017 Revenue 25% of 2017 Revenue Second largest short line operator (largest private 87 Terminal and Port Operations • • operator) in North America with 38 short line railroads Transload Terminals • in the U.S. and Australia Marine Terminals • +440 locomotives Specialty Terminals • • +4,200 railcars • +5,100 track miles Service Offerings • • +1MM car loads transported or switched Dedicated Contract Facilities • • 31 switching and other operations Merchant Terminals • • Operations in 29 states and Australia • Mechanical Services Supply Chain Services 14% of 2017 Revenue 8% of 2017 Revenue Opportunity to solve Customer supply chain needs Formed joint venture with The Greenbrier Companies • • effective July 18, 2014 (“GBW”) Provides repair and maintenance services 15 Supply Chain Service Centers • • End to End solutions 31 mechanical facilities • • Tank Shops • Freight Car Shops +25,000 Licensed Motor Carriers Under • • TTX Shops Contract • Mobile Repair • Customer ♦ Commodity ♦ Geography ♦ Service 5
Perishable Express Goals Initially: Protecting rail shipments of our shortline’s biggest commodity (fresh potatoes) by innovating service, facilities, and equipment (the Supply Chain) Now: Building a new supply chain using the most efficient equipment and new technology with the rail industry’s best service to build incremental perishable rail traffic
Eastern Idaho Railroad
Things To Fix • Service: 20-30 day one-way cycle time • Equipment: Retiring 50’ ARMN fleet - 2.5:1 truck conversion • Damage: Consistent 5-20% damage per rail load due to existing slip sheet pallet loading • Dunnage: Customers paying $500-750 per load to secure slip sheet pallet loading (particularly in fresh shipments) • Loading/Unloading Time: Slip sheet pallet loading/unloading takes 5-6 people 4-5 hours per car to load/unload a car
Learn About The Market: Current Truck Lanes
Burley, ID - Market Customer First – Safety Always!
Idaho Falls, ID - Market Customer First – Safety Always!
What We Did • Service: Use Class 1 premium service • Equipment: Use the largest most efficient car • Damage/Dunnage/Loading & Unloading: Use new technology Bundled Pricing and Tracking “Farm to Table” •
What is Perishable Express • Burley Warehouse • New Car, New Equipment (Racks, Rollers) – 72ft Car, 4:1 truck conversion – Racks, eliminates dunnage, speeds loading, reduces damage, gets down to “pallet level” customer) • Service (UP “Food Train”, NS Intermodal) • Bundled “farm to table” pricing and tracking using Watco Supply Chain Services • Not just fresh potatoes now (butter, onions, frozen potatoes) – flexible to ship multiple commodities per load Truck competitive product to the Northeast (and soon to be Midwest)for Idaho Shippers
Train Service UP Food Train • – EIRR connects at Minidoka and Idaho Falls and hits the Food Train at Pocatello – < 3 days Pocatello to Global 3/Rochelle; Train ZWACYP – UP intermodal train (Rochelle – Chicago) connects to NS; Train IG3AH NS Intermodal • – Cars run on priority UPS intermodal trains Ashland Ave/Chicago – Harrisburg, then Harrisburg – Bethlehem; Trains 24Z and 22V Total transit time Burley – Bethlehem has ranged from 7-11 days (the 11 day trip was during the blizzard of early 2017)
A Sight For Sore Eyes – Getting Through Chicago
Origination Terminal – Watco acquired the Burley, ID Warehouse to feed Food Network. – Developed a trucking strategy with a local Idaho trucker to deliver product from customer sheds to the Warehouse. – Joint marketing with customers to win business.
Destination- Bethlehem, PA Customer First – Safety Always!
Equipment - Refrigerated Boxcar Specs • Partnered with ARX (Fed Ex freight movement/rack system) • GBRX and TILX Refrigerated Boxcar Specs o ~179,000 lb. net weight o 20 Racks / 80 pallets per railcar o 4:1 Truck to boxcar conversion
The Rack and Rollers System
Loading
Inside the Car
Total Package • Utilizes Patented Racking / Roller System o Eliminates damage o No dunnage o No blocking/bracing o Faster and safer load / unload • Premium Rail Service o 7-9 day normal service o Truck competitive o Added capacity o Manifest to Intermodal
Customer First – Safety Always! 7
Where are we today? • Fully integrated and flexible supply chain – Trucks – Warehouses – Rail – “One Price” • 4 Cars In Service / 21 In Service by 3Q • 3 Tables In Service • LCL “Pallet Level” Shipping via the rack system – Mixed products – Mixed customers
Commodities • Eastbound Examples of shippers utilizing Perishable Express – Fresh potatoes from Burley, ID to NJ for cruise ships – Fresh onions for restaurants in NY, NJ – Mixed loads of fresh onions and potatoes for grocery stores. – Frozen butter for croissants for LeCoq Cuisine in CT and for cookies for David’s Cookies in PA and NJ – Frozen French fries from Caldwell, ID to PA. – Frozen potatoes products from Caldwell to New England destinations.
What’s Next • 21 total cars in service by 3Q • 5 tables in service by 2Q • Setting up additional origins and destinations – Rochelle, IL (Midwest Market) • Turn Nampa (BVRR interchange) on to UP Food Train • Continued fleet expansion • Developing Backhauls – Shipped our first backhaul last week (Boston Beer Co. and other NE micro brews to Seattle from Bethlehem) – 3x 2000+ mile loaded hauls in a month
Future Destination - Rochelle, IL Customer First – Safety Always!
The Secret Sauce • Focused Origins and Destinations • Must connect well with intermodal/premium service network • Shortline or Class 1 delivery: Both work • Extremely short turn time on equipment
Thank You
Recommend
More recommend