The corporate wreck of Hanjin Shipping Co. validated the 2016 storm warnings for global container shipping lines, but there were some sunny breaks for B.C. terminals.
US$5.4 billion route canal
An expanded Panama Canal, larger ships and more carrier alliances, coupled with lingering anger over the protracted labour contract negotiations that stalled container cargo movement through West Coast U.S. from mid-2014 through early 2015, accelerated the migration of container cargo away from North America’s West Coast to facilities closer to the rich U.S. eastern seaboard market.
Development of inland ports on the U.S. East Coast increased the appeal of eastern cargo shipping options.
The looming arrival of more 18,000 to 20,000 20-foot-equivalent mega-container vessels at West Coast U.S. ports accelerated container cargo handling investment in major ports like Los Angeles-Long Beach, which opened its US$1.3 billion Middle Harbour terminal.
However, the Port of Vancouver’s first-half 2016 container cargo was 6.5% lower than the same period a year earlier.
Other transportation issues that mattered in 2016
Rail merger mothballed
In April, Canadian Pacific Railway Ltd. (TSX:CP) and its CEO, Hunter Harrison, abandoned the pursuit of a mega-merger with one of America’s Big Four railway companies after repeated rejection from Norfolk Southern Corp.’s (NYSE:NSC) board of directors. The merger, according to Harrison, would have achieved $1.8 billion in operating efficiencies and synergies and provided shippers in Canada and the United states with better access to tidewater shipping facilities and major metropolises east of the Mississippi via one major efficient rail network that would allow freight to reroute around such major bottlenecks as Chicago.
Mobi moves in
Three months after launching in the summer in downtown Vancouver, bike-sharing service Mobi reached 100,000 rides, far exceeding company expectations. The program now has around 5,000 full-time members, who pay $129 for an annual membership. It recently announced a strategic partnership with telecommunications giant Shaw Communications Inc. that will expand Mobi’s reach in the city while supplying members with free wireless Internet at more than 100 Mobi stations in downtown Vancouver.
Evergreen finally a go
Opened December 9, more than five months behind schedule, the 11-kilometre, six-station Evergreen Extension runs between Burnaby and Coquitlam via Port Moody. The line was initially projected to start operating in 2014; however, a number of construction issues delayed opening. TransLink estimates the $1.4 billion upgrade will carry approximately 70,000 passengers daily by 2021.
Air Canada adds routes
Air Canada (TSX:AC) extended its service substantially in 2016. Canada’s largest airline added more than 10 trans-border routes, making it one of the most intense international expansion periods in the airline’s history. Air Canada also announced third-quarter earnings of $1.25 billion, a record quarterly high.
G3 Terminal Vancouver
A $500 million grain terminal proposal from a joint venture partnership between G3 Global Holdings and Western Stevedoring Co. Ltd. has been granted a project permit by the Vancouver Fraser Port Authority. The G3 Terminal Vancouver will be designed to optimize receiving, storage and shipping of grain on Canada’s west coast. Residents of the North Shore are concerned about the impact of the project on views and the local environment, but permit conditions imposed by port authority ensure strict operational requirements. A final investment decision is expected to be made in 2017.
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Source: Business in Vancouver