The last blog in this series examined road and rail transportation within Canada; this blog will focus cross-border freight transportation. Please note that there are a set of processes and procedures (http://www.dantranscon.com/index.php/blog?view=entry&id=241 ) that must be followed in order to move goods successfully between the United States and Canada. Please refer to the second blog in this series for details.
LTL Service
It should first be noted that only a small number of American LTL carriers have a network of terminals across Canada. Con-Way, FedEx Freight, YRC Reimer and ABF service the major points in Central and Western Canada. They work with interline carriers to service the remaining points in each province and territory. There are no Canadian LTL carriers that have extensive LTL networks in the United States. While some Canadian LTL carriers have terminals in selected US locations (i.e. Chicago, Los Angeles), most LTL carriers work with partners on the other side of the border.
The following chart displays the logos of some of the major LTL carriers that service the cross-border freight market.
The following is a list of some of the more well-known LTL carrier partnerships.
o R & L Carriers partners with Day & Ross
o Estes Express partners with TST Overland Express
o Old Dominion partners with Speedy Transport
o Canadian Freightways and Kingsway Transport are part of the Reliance Network (Averitt, Pitt-Ohio, Lakeville)
o A Duie Pyle partners with Midland and Concord Transportation
o New England Motor Freight has just partnered with Dicom Freight
Some carriers form marketing partnerships with their cross-border carrier or carriers; others are operating partnerships. When carriers form true marketing partnerships, there are annual and/or regular sales training meetings for the respective sales teams, sales lead exchanges and computer system integration. In the case of operating partnerships, they are designed to exchange freight on certain moves. In these situations, Canadian and American carriers may actually use different partners on various freight moves.
The following charts display some marketing partnerships that have been in place for some time. In the case of regional LTL carriers in both countries, some are part of extended partner networks that serve large geographical areas (i.e. Reliance Network) while others may serve limited geographic areas.
Since the cost of establishing an extensive American LTL network is prohibitive for most Canadian carriers, some companies choose to operate with a skeleton group of US-based terminals or without any US terminals. These partial truckload carriers serve designated areas of the United States (i.e. northeast, Carolinas/Georgia) and move multi pallet, quarter load, half load or full load shipments.
Truckload Transportation
Truckload freight moves between the countries via road and rail. The chart below displays the names of some of the major cross-border truckload carriers.
Note that the chart displays a range of American and Canadian truckload companies. Shippers need to check on the preferred service areas for the truckload carriers that they select. It is common for many carriers to have more freight density in certain geographic areas and less in others.
The railways and intermodal marketing companies can arrange for the movement of cross-border carload and/or intermodal transportation. As on domestic shipments, intermodal transportation is most cost effective on lengths of haul 750 to 1000 miles or more. The two class 1 Canadian railways work with the major class 1 railways in the United States to perform cross-border rail transportation for the points they don’t serve on a direct basis. For more information on Canada’s two major railways, see the previous blog.
As outlined in the first blog in this series, Canada is large land mass with limited population. As a result, Canada’s two class 1 railways, along with the country’s short line carriers, play a very important role in meeting the needs of Canada’s freight industry.
Small Parcel Carriers
The major American and Canadian small parcel carriers service the cross-border market. The chart below contains the major players in this segment.
Canadian Ports
Canada’s National Ports System consists of 18 ports that handle 50% of the country’s shipping volumes. The Great Lakes/St. Lawrence inland waterway system from the Atlantic Ocean to the heartland of the United States is an important trade corridor that serves 15 major international ports and 50 regional ports on both sides of the Canada/U.S. border. Port Metro Vancouver, Montreal, Halifax and Prince Rupert, BC are the top 4 Canadian ports. The ports connect with major rail and road networks to facilitate the movement of freight between the countries.
Consulting and Freight Management Companies
For shippers that need assistance moving freight between the countries, they can use the services of consulting companies like ours or contract with a freight management company. These companies vary in capabilities and resources. The chart below displays some companies that have offices in Canada. Shippers need to do their due diligence to select companies that match up with their requirements.
Pricing Issues
Small parcel pricing in Canada is similar to the US in the sense that there are rates for various time specific services. Cross-border LTL rates may be based on the National Motor Freight Classification (NMFC) system that is still widely employed in America or pallet rates that are tied to commodity and density (pounds per cubic foot). Truckload rates are similar (i.e. flat rate, rate per mile) in structure to American rates.
Fuel surcharges are different in Canada. The Freight Carriers Association fuel surcharge formulas, the industry standard, are published weekly. Fuel surcharges vary by mode and by whether the freight is moving domestically within Canada or cross-border. Note that for larger shippers, it is reasonable to negotiate a discount off the published fuel surcharge.
If you need assistance in serving the Canadian or cross-border market, contact me at dan@dantranscon.com. To stay up to date on Best Practices in Freight Management, follow me on Twitter @DanGoodwill, join the Freight Management Best Practices group on LinkedIn and subscribe to Dan’s Transportation Newspaper (http://paper.li/DanGoodwill/1342211466). To learn more about the Canadian freight market, come to the 2016 Surface Transportation Summit (www.surfacetransportationsummit.com ) on October 13.