FreightWaves reported earlier this month that a Canadian Pacific (CP) - Kansas City Southern Railway (KCS) freight train traveled from the port of Lάzaro Cάrdenas, Mexico to Chicago in seven days utilizing KCS dé Mexico, a KCS subsidiary.
Not only is this a strong Midwest supply chain route to alleviate freight coming into the LA/Long Beach ports, but it strengthens the USMCA trade agreement since once arriving in Chicago CP can move freight into Canada as well.
While the article makes no mention of interim stops along the route, cargo can be off-loaded to trucks in Chicago headed for Midwestern destinations.
CP Rail is a critical link in manufacturing supply chains, and it is how it moves goods to markets across North America. Hindering CP operations in Canada the past few days, is the stalled contract negotiations with the union representing its conductors and engineers. The March 23rd edition of the Wall Street Journal reported that the union agreed to shift negotiations to binding arbitration allowing CP to resume shipments.
Lάzaro Cάrdenas had been tied up by a teachers strike of all things in 2020, preventing KCS trains from entering or leaving the port, but has been resolved. The port’s deep-water infrastructure allows large container vessels to offload cargo bound for Midwestern destinations.
As IBNewsmag reported in 2013, “The KCS rail network passes through the Mexican border seamlessly and securely achieving a 99.98% theft and claim-free record in Mexico to its journey to interior points and to the ports it serves.”
FreightWaves went on to report, “Furthermore, should federal regulators approve CP’s $31 billion acquisition of KCS, the combined railroad would invest in infrastructure along the route and create a new Mexico Express interline service, according to CP.”
The CP – KCS merger would create the first transportation company with a rail network spanning all three countries and enhance the facilitation of the movement of freight across them. Last year, KCS invested $167 million in Mexico, which includes railways serving key port cities including Veracruz, Tampico and Lάzaro Cάrdenas, according to the report.