Monday, August 27, 2018

Some thoughts on Amazon coming to Ottawa

Ottawa can consider itself pretty lucky to have a sizeable consolation prize from Amazon. The city lost out, like many other cities, in its bid to be the home of Amazon’s second headquarters, so HQ2. Amazon announced recently that it would be locating a massive million-square-foot facility on Boundary Road, in the city’s east end. The facility will be a warehouse and shipping hub for the company (fulfilment centre is the official name). From the coverage, I read that this building will have 97 truck bays. Of course, that had me thinking.

While the city has been busy slapping itself on the back for this development, which will employ more than 600 people, not to mention 1,500 people in the construction phase, I see problems.

Why? Well, the increased truck traffic on Highway 417 will tax an already strained highway, which is certainly near its capacity in Ottawa itself. Traffic coming from Quebec will have an easier time reaching Boundary Road.

Anyone who lives in Ottawa will tell you that the truck traffic on local highways and in the downtown core is excessive to say the very least.

When I checked out where the new Amazon facility would be located on Boundary Road, I did a quick check to see where it was in relation to a railway. It turns out, not far. Via Rail’s Alexandria Sub runs through Carlsbad Springs, which is just up the road from this facility.

I have no idea if Amazon makes use of intermodal transportation to get its goods to its facilities, but I would think there would be an opportunity here to take advantage of the economies of scale that railways offer.

Of course, the biggest challenge would be how to do you get all this merchandise to Ottawa on a train and then load those containers on trucks so it can be taken to the Amazon facility? Ottawa has no intermodal facilities in this area, save for a tiny little boxcar loading ramp located at the Rideau Bulk property next to Walkley Yard.

And that’s where the idea dies. There is so little rail infrastructure left in this city that an idea like this is dead in the water. It’s a shame because after the excitement dies down over the Amazon facilities, a few uncomfortable realities will settle in. In fact, they already have. Construction has begun on this centre and already, people in the area are complaining about the noise and dust in the local media.

This project begs the question, how is the city going to accommodate all this truck traffic on the highways? How many millions will be spent to widen Boundary Road? What will the impact of this truck traffic be on communities like Carlsbad Springs?

You might recall that I have in the past suggested that perhaps Ottawa would be an interesting site for an intermodal hub serving parts of Eastern and Northern Ontario. Of course, I’m no expert on these matters, but I wonder if anyone is thinking of possibilities like this.


Keith Boardman said...

I think it would take years of prolonged traffic problems before anything is done, and even then, it will just be wider roads.

Sadly, Ottawa lost it's rail link to the west when the Beachburg Sub was pulled up from Pembroke. I think very little of the Chalk River Sub west of Arnprior has been repurposed as anything other than a trail, so it would have made sense to keep it, but this idea died too when CP pulled up the tracks. Lack of vision on their part, at least in my opinion, however the cost to rebuild this network is so huge that it will never happen.

Maybe the Moose Consortium has some ideas, although that group seems to have pretty lofty aspirations that really don't make a lot of economic sense in the near term.

We can hope for more frequent freight movements from Montreal, but like you said, there is no intermodal facility in Ottawa, and the cost to build it for only 1 warehouse probably wouldn't make much sense.

Michael said...

Can't argue with any of your points, Keith. I don't want to rain on anyone's parade, especially since this will be a great thing for the east end of the city. I just foresee lots of problems with truck traffic overloading Boundary Road when it seems to me that maybe some movements from Montreal via rail would ease the burden a bit. But, as you say, there is so little infrastructure to support any rail freight in Ottawa.

Unknown said...

Unrelated but perhaps you could shed some light on a recent train I spotted. Saw a Fallowfield bound CN freight on Wednesday morning at 9 20 am going through Richmond with seven cars. Some Potash and others box cars. Perhaps a new run? Just curious

Unknown said...

I've occasionally seen Potash cars sitting in Walkley Yard over the last year so that might be related to what you saw. Perhaps it was destined for Synagri (who is apparently a fertilizer producer).

Michael said...

If you look back and search Potash and Bechburg Sub in Google, you will see that CN regularly delivers Potash covered hoppers to SynAgri during the appropriate seasons. I've mentioned this in the past. If you saw a freight heading toward Richmond on Wednesday, you likely saw a combined CN 589 run. Readers in the past have seen CN operating on the Smiths Falls Sub on Wednesday, which is the same day it runs out to Arnprior via the Beachburg Sub/Renfrew Sub to deliver caprolactam to Nylene Canada. Thanks for the updates!

DaveM said...

It should also be noted that Amazon recently closed its engineering shop in Ottawa.


Eric said...

I can only dream of a day when all the truck traffic goes back to railways. Or when containers are used fully multimodally between trains and trucks. If there was ever an ideal candidate for this, it would be Amazon. Not having infrastructure in place probably works against my dreams! I'm going back to sleep now.

GP9Rm4108 said...

VIA owning the Alexandria is a hurdle to increased freight transportation. CN will likely have no interest in having a terminal for containers in Ottawa with Montreal so close.

Even with that, I don't know whether Amazon has a contract with CN, CP or both. If it's CP, it doesn't even matter.

AJ said...

I am on the same page as you are - this is definitely going to make the truck problems worse. I know locals downtown hate it and being related to many drivers who have to drive through there, they hate doing it too.
The sad reality is that the truckers are the ones who are blamed and will be blamed when the street cars are up and running and there is no reduction in traffic on the 417. In reality, most traffic is already coming from the far reaches and the street cars are simply a nuisance. If anything traffic is set to get worse. It also doesn't help that there is no proper ring road like in every other major city on the continent. Let's face it, if your running trucks from boundary road to say Carleton place, a ring road makes for that much less traffic on the 417.

Anyway, I was fully expecting and not surprised that Amazon put a warehouse in the city somewhere. As we all know, Shopify is homegrown, HQ'd downtown and a direct competitor. Amazon had to put something in their back yard. If I was running the show there, I would 100% have done the same thing. I know the trucks offer much needed flexibility, but its too bad they couldn't pay for a spur to the warehouse....