AJOT Insights - AI optimization software helping ports improve intermodal rail operations
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American seaports are vital to the U.S. economy, providing a gateway to the global marketplace. Today, however, they are in need of critical infrastructure and technology improvements. Most pressing are their needs in upgrading and expanding their rail infrastructure and intermodal capacity. Canadian ports are already investing heavily in this area. The Canadian National Railway (CN), a class one freight railway, announced that it will invest approximately $445 million Canadian dollars in rail track infrastructure projects at the Port of Vancouver and the Port of Prince Rupert, among other projects.
Existing rail terminal operations at seaports are complex and capacity fluctuations create challenging operational scenarios. Disruptive events such as COVID-19 create additional volatility. To optimize their operations and increase intermodal rail capacity, progressive ports are turning to Artificial Intelligence (AI) based optimization software.
Increasing Container Velocity and Maximizing Critical Space
The American Association of Port Authorities (AAPA) reports that its members identified $20 billion in multimodal port and rail access needs through 2028. Rail access is associated with speedier vessel processing and is crucial to the multimodal movement of goods. Although 93% of ports have rail access, many ports‘ on-dock and near-dock rail systems infrastructure and technology require updates. When asked in an AAPA survey how much more throughput capacity could be added to their ports with improved rail access, 42.86% responded they expected capacity gains of more than 25%.
Last year, AAPA reported cargo activities at U.S. ports alone were responsible for $5.4 trillion in annual economic activity, supporting 30.8 million jobs and providing $378.1 billion in tax revenue to federal, state, and local governments. According to AAPA President and CEO Christopher J. Conner, „The economic downturn this year has caused significant economic damage to our ports, with an estimated decline of 20% to 30% of their total annual receipts.“
Although the port sector has been one of the hardest hit by COVID-19 disruptions to the supply chain, it largely continues to operate without interruption. Pre-pandemic efforts to digitize work processes can partially be credited for this performance. Still, the pandemic has shown the need for real-time optimization of terminal work processes.
Prior to the pandemic, the rise in ultra-large container ship traffic placed considerable strains on port infrastructure and operators‘ ability to expediently process growing cargo volumes. The first two quarters of 2020 marked a continued increase in these ship arrivals, creating congestion peaks and overwhelming landside and yard operations.
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