John D. Boyd | Apr 15, 2010 6:26PM EDT
North American intermodal service provider Hub Group is buying 2,000 new 53-foot domestic containers for about $19.2 million, which would increase its fleet of those boxes by a third.
The company said in filings with the Securities and Exchange Commission that it recently contracted with Singamas Management Services to build the boxes at its plant in Qingdao, China, and ship them to Southern California starting in May.
Their deal called for Singamas to assure that some of the container parts will be interchangeable with other 53-footers Hub bought in 2005, 2006 and 2007. Singamas built a prototype to Hub’s specifications, and was to start full production of the order once that unit cleared inspection.
Hub said in a Feb. 18 annual report filing that it already has 6,225 of the big containers, for use on Union Pacific Railroad and Norfolk Southern Railway. So this could bring its owned fleet of the jumbo domestic boxes to 8,225.
That size container is used predominantly for loads that originate and terminal within North America. Some imported cargoes are also transloaded at the West Coast, taken out of 40-foot boxes that are standard on ships and put into the 53-foot containers for their inland trip by rail. That can bring extra efficiencies for particular types of shipments.
Hub also has use of even more intermodal equipment -- containers and truck-hauled chassis – that is owned by the railroads, and on which it pays rental charges. As of yearend 2009 it had exclusive use of about 7,355 rail-owned containers for the UP-NS service and another 1,375 for Hub’s dedicated use on BNSF Railway and NS.
Contact John Boyd at jboyd@joc.com.
