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BNSF enters Mexico intermodal market

BNSF and Ferromex

   BNSF Railway, the largest freight railroad in the United States, will launch its first intermodal service offering in Mexico on May 27 in partnership with Mexico’s largest rail carrier, Ferromex, the company announced Tuesday.
   The truck-train container service will run between Chicago and Silao in Guanajuato, where Ferromex operates an intermodal terminal. Ferromex invested more than $20 million to upgrade the facility and since 2011, has made several improvements to its mainline between Silao and the Juarez- El Paso border crossing where the two railroads will interchange cars, BNSF spokeswoman Amy Casas said via e-mail.
   BNSF will operate one train per day five days a week on the route.
   The company for many years has transported agricultural and industrial products, as well as finished vehicles produced in Mexico through gateways in San Diego, El Paso, Eagle Pass, Laredo and Brownsville, Texas. Access to Mexico is provided through Ferromex and KCS Mexico, which is owned by railroad holding company Kansas City Southern.
   The new service “means that automakers and manufacturers in the U.S. and Mexico will now have direct access to the advantages of intermodal rail in the Bajio region,” Steve Bobb, BNSF’s chief marketing officer, said in a statement. “This service offers Mexico’s fast growing manufacturing sector in the Bajio region a simple way to reduce trucking costs and delays.”
   The news coincides with the 20th anniversary year of NAFTA. The growth of cross-border rail was a major focus of the NAFTANEXT summit in Chicago last month. Mexico is the United States’ third largest trading partner, with more than $500 billion in annual trade.
   Casas said BNSF expects intermodal volumes to grow in both directions over time.
   The Ferromex intermodal hub is located within 100 miles of major manufacturing centers in Leon, Irapuato, Celaya, Salamanca, Queretaro and Aguascalientes. BNSF said the service is faster than truck because rail avoids the commercial truck congestion at border checkpoints and the system that involves multiple handoffs between inland carriers and shuttle drivers in the border zone. Southbound shipments are moved in-bond — paperwork requirements are settled at destination — to minimize Mexican Customs clearance delays. Once shipments arrive in Silao, customers can clear the cargo with the customs broker of their choice. Northbound shipments also cleared at destination.