24 DC VELOCITY FEBRUARY 2014 www.dcvelocity.com
newsworthy
Three consumer packaged-goods (CPG) giants have shifted
some of their pan-European shipping from truck to intermodal and are sharing rail capacity on westbound movements across the continent. This shift marks perhaps the
most ambitious effort to date by companies in the category
to use intermodal to reduce their carbon emissions.
The companies—personal care giant Colgate-Palmolive
Co., snack foods company Mondelez International Inc.,
and Swiss conglomerate Nestlé S.A.—launched a pilot program in late September to move goods via rail from Poland
to the Netherlands. Under the program, the companies
load their own containers at factories in Poland and have
them drayed to a rail terminal in Poznan in the western part
of the country. From there, the equipment moves by rail to
the Port of Rotterdam, where it is shipped by ferry across
the North Sea to Immingham on England’s east coast. The
shipments are then trucked to each company’s logistics service providers. Immingham has highway connections linking it to major population centers in England and Scotland.
The shift from truck to intermodal is part of an initiative
to reduce greenhouse gas levels, according to the Joint in
Transport Cooperative (JIT), formed in February 2012
to promote the environmental benefits of shifting traffic
from road to rail. The service between the three companies
is being run under the cooperative’s umbrella, according
to Peter Jordan, its director. Groups such as The Global
Commerce Initiative and The Consumer Goods Forum
were involved in establishing the cooperative, as was global
consultancy Capgemini Consulting.
Antitrust and other legal concerns were a major impediment to rolling out shared rail services on the continent,
Jordan said. The group eventually developed a “legal
infrastructure” that avoided problems with the European
Commission, the European Union’s (EU) antitrust arm,
he said.
Seacon Logistics, a Dutch third-party logistics service
provider (3PL), is overseeing the program’s execution.
Seacon handles logistics operations for the rail movements
and manages a so-called control tower to provide real-time
in-transit shipment visibility.
Jordan said Colgate-Palmolive, Mondelez, and
Nestlé hoped to move between 50 and 100 containers a week via intermodal during the Christmas
season. JIT plans to offer train services this year in
Spain, France, and Italy to create a south-to-north
route through Europe, he said. JIT is seeking other
companies to join the program.
Based on the current projections for use of the
shared rail service, JIT estimates that the conversion from truck will reduce the companies’ carbon
dioxide (CO2) emissions by 18 million kilograms
(nearly 40 million pounds) per year.
U.S. VIABILITY?
It remains to be seen whether such an effort could
also work in the United States. Alex Stark, director
of marketing for 3PL Kane Is Able, a Scranton, Pa.-based company that specializes in CPG logistics,
said he’s seen no evidence in the United States of
CPG companies’ shifting from truck to rail other
than a conversion of a small amount of traffic moving from factory to distribution center.
Shanton J. Wilcox, a principal at Capgemini,
said he’s unaware of any such activity in the U.S.
market. Wilcox said some industries doing business in Europe are looking to convert shipments
bound for emerging EU markets from road to rail
in part because the lower cost of rail services would
neutralize the impact of high tariffs imposed on
inventory in those markets.
—By James A. Cooke and Mark Solomon
CPG giants launch collaborative intermodal service in Europe
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… Kristy Knichel, president and CEO of Knichel Logistics, was
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accolades
