Connecting Hinterlands to Ports Through Rail Investment

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1 Connecting Hinterlands to Ports Through Rail Investment

2 The Ideal: Every inland warehouse door is a virtual port From Ideal to Reality Rail Solution is Competitive vs. Truck Direct All In Total Logistics Cost Comparison Include upstream and downstream logistics impacts Transit Speed and Reliability Capacity and Infrastructure Investments are required: Rail-Port Interfaces Rail Network Inland Rail Terminals Rail Network Inland Connector Hubs Technology addresses the significant quantum level of complexity required for optimum rail mode results 2

3 The Rail Model vs. Truck Model: 20,000 TEU s 20 MPH Large Economies of scale Ship to Marine Stack Marine Stack to Gate Truck Transit-Marine Gate to Warehouse Door 2 TEU s No Economies of Scale 60 MPH Ship to Marine Stack Marine Stack to Rail ICTF Rail ICTF Processing Rail ICTF to Serving Yard Train Transit 30 MPH Inland Connection Train Transit 30 MPH Inland Terminal Processing Inland Terminal to BCO Drayage 300 to 900 TEU s Medium Economies of Scale 3

4 Port Rail Interface Component Investments On-Dock Rail Intermodal Container Transfer Facilities Rail connector / access capacity between On-Dock ICTF s and Class 1 serving yards and mainlines Double-stack clearances Stakeholders Federal State and Local governments Port Authorities 4

5 Port Rail Interface: Recent Successes and In-Progress Mobile, AL: ICTF Jaxport, FL: ICTF-2016 Savannah Georgia Multimodal Connector ICTF-2021 SCPA-Navy Base ICTF-2019 NCPA-CCX Carolina Connector-2020 VPA-VIG and NIT Rail Expansions: PMT-On-Dock Rail: 2016 CSX National Gateway Clearances: Dec MPA-FAST Grant Application: Howard Street Tunnel PANYNJ: GCT On-Dock Rail and Bayonne Bridge Clearances 5

6 CSX is addressing the network components of linking the Hinterland to Ports through our Network Of Tomorrow Strategy Transforming Network Identified and started preliminary work on nearly 40 projects Chicago New York Virginia Avenue Tunnel Capacity Investments Virginia Avenue Tunnel Jacksonville 2016 Completion 2017 Projects 2017 Committed / Contractual 7

7 Rail Network Capacity Stakeholders Class 1 Railroads State, Local and Federal Governments Real Estate and Industrial Development Interests Anchor Customers with major volume commitments 8

8 CSX already has extensive terminal investments and network linkage with ports in traditional intermodal inland port markets The last rail link in the chain Located on CSX s Primary rail network Major Metropolitan Markets >250 miles from nearest container port Opportunities for synergies between international and domestic flows 9

9 Inland Ports : Non Traditional/Short Haul Markets Typical Stakeholders Federal State and Local Governments Port Authorities Industrial Development Authorities Anchor Rail Customers Prerequisites Independent Financing Terminal Sufficient mainline access infrastructure Successful Permitted Volume guarantees Viable service and economics vs. truck Location on the CSX primary network 10

10 11 Connecting The Hinterland: Inland Port Development, Recent Success Stories

11 CSX s Network Strategy: Montreal Northwest Ohio Chicago Philadelphia St. Louis Portsmouth Raleigh Nashville Memphis Wilmington Hub-and-spoke + corridor provides shippers the ability to reach more markets Increases flexibility and reliability Connects small & mid-tier markets Reduces drayage miles and cost, making Intermodal more competitive with Truck Supports both frequency and density Atlanta Mobile New Orleans NWOH Carolina Connector (CCX) Charleston Savannah Jacksonville South Florida CCX captures a vibrant Raleigh market and provides hub connectivity in 100+ lanes Advances connectivity with ports Major support from NCPA and NCDOT, NC Stakeholders 12

12 Connector Hubs like NW O and CCX will play an increasing role in creating truck competitive inland port services CCX operating model will further automate the Northwest Ohio (pictured) terminal model, which remains the most advanced in North America to date 13

13 Inland Drayage Productivity: The Last Mile Every Rail Move Starts or Ends with A Truck The CSX of Tomorrow Strategy Highly Automated Railroad Automated/Grounded Terminals State of the Art Terminal Operating Systems Technology solutions to leverage driver productivity and satisfaction Inland Chassis Cost Reduction Service Excellence Xgate Automated Gates Infrastructure and Mobile Application 26 Terminals by Q Ipro: 19 of 25 Major Terminals Enhanced terminal management and planning 14

14 15 Questions?