Less than three years after it opened, CSX has closed an intermodal terminal in Pittsburgh.
The terminal, which cost $60 million and was located in a former Pittsburgh & Lake Erie yard in McKees Rocks, was part of the National Gateway Initiative that a previous management of CSX launched in 2008.
The Pittsburgh terminal, which opened in September 2017, was the last component of the National Gateway to be completed.
The $850 million public-private project also included construction of an intermodal terminal at North Baltimore, Ohio.
At the time that these terminals were built, CSX was using a hub and spoke strategy to build intermodal traffic.
That strategy was dropped several months after the late E. Hunter Harrison became CEO of CSX in March 2017. Instead CSX began favoring intermodal service lanes with the highest volume and profit.
An analysis published on the website of Trains magazine suggested that the 70-acre Pittsburgh intermodal facility was doomed by the decision of CSX to end steel wheel transfer in Chicago of intermodal containers and trailers received from western railroads.
Instead those containers and trailers are moved across Chicago by highway.
Trains quoted intermodal consultant Larry Gross as saying this effectively made traffic coming into Pittsburgh from the West a 460-mile haul for CSX, which the carrier might not have seen as being profitable enough.
Gross noted Pittsburgh is a relatively short haul for CSX intermodal traffic and that worked against it.
He also said the CSX network was not well suited for diverting north-south highway traffic through Pittsburgh onto rails.
CSX has leased the site of the Pittsburgh intermodal terminal to Shell Oil Company, which will use it as a storage-in-transit facility for a new petrochemicals complex it is building 30 miles northwest of Pittsburgh in Potter Township that will produce 1.6 million tons of polyethylene annually.
However, CSX stands to benefit because the haulage of plastic pellets is more profitable than intermodal traffic.
CSX said it can handle intermodal traffic to Pittsburgh through other existing terminals.