Railcar Shortage Slows Down Shipment of Cars and Trucks
It seems production shortage is not a big problem faced by the automakers in the United States now. They are worried and struggling because of railcar shortage, which are used to carry cars and light trucks from assembly plants to dealerships. The total number of units awaiting shipments has increased a lot. It is estimated that, as of May 18, daily inventories of vehicles awaiting shipment totaled 81,470 units.
According to TTX Co. — a Chicago based company that coordinates rail shipments of vehicles for the railroad industry, the above figure is well above the standard daily inventory of 69,000 vehicles. North American automakers are worried about this situation as they fear it could affect the increasing vehicle production. Automaker giants such as Toyota Motor Corp. also observe this situation seriously as the company has a daily inventory of 10,000 vehicles awaiting shipment from its North American assembly plants. Mike Nelson — Toyota Motor Corp.’s national manager of rail strategy and operations said that the present scenario is a nightmare for the automaker.
“If it gets to 12,000 or 13,000 units, we’ll have trouble. We were there earlier this year. We watch this on a daily basis,” Nelson warned. CSX Transportation — a leading supplier of rail-based freight transportation in North America made clear that it prolonged its fleet of rail cars in 2012, without indicating the number how many it acquired. The railroad, which serves the eastern United States, said that it will acquire extra units in 2013 and beyond. However, the railcar shortage is particularly bad for Midwest assembly plants and also for Coast ports that hold shipments of Asian-made vehicles. As the automakers require unique rail cars to carry vehicles, it would be tough to fix the delays at present. Bi-level autoracks carry 10 full-sized SUVs and pickups, while tri-level autoracks hold 14 cars.
“The railroads deliver empty autoracks to an industry pool managed by TTX, which sends them where they are needed,” said Martin Colbeck, a claims manager with Auto Warehousing Co. — a logistics company that loads cars and trucks at rail depots. “The penalty is exorbitant. They can’t do it. So the automakers wait for the railcars,” he concluded.