Tuesday, May 21, 2013
By GREG QUINN and FREDERIC TOMESCO/Bloomberg News
MONTREAL — Rejean Rioux reaches across his truck's cab and hands over his wristwatch to show how a Quebec highway bottleneck slows companies such as Canadian Tire Corp.
Rejean Rioux and son Guy, of Gilbert M. Rioux & Fils, with one of their double-trailer trucks at headquarters in Saint-Andre, New Brunswick. The company breaks up and reassembles trailers for narrower roads, delays that can add significant costs and slow commerce.
Greg Quinn/Bloomberg News
At the bottom of an off-ramp near where the divided four-lane section of the Trans-Canada Highway ends, he pulls the oversized steering wheel and uses almost all the road's width to turn his rig and two 53-foot trailers. Rioux and others must do this each time they pull double-trailer trucks off the highway and into a yard to break them up for the narrow road ahead.
"You need 30 seconds to make the turn," Rioux said. Such holdups can determine "whether you make money or not."
The half-minute turn is just the start of delays for so-called long combination vehicles running between Montreal and the port at Halifax, Nova Scotia. The trip includes a 45-mile stretch of Highway 185 from the Quebec-New Brunswick border that's too narrow for the long trucks.
The time to break up the trailers, put a separate tractor on each and reassemble them can add a couple hours to each round trip, said Neil McKenna, vice president of transportation for Canadian Tire, the country's largest auto parts and sporting goods retailer.
"This is the only area of Canada where we de-couple and couple en route," McKenna said by phone from Montreal. The Highway 185 widening would "make the supply chain that much more competitive."
BATTLING AMONG PROVINCES, TERRITORIES
While Quebec has been planning the project since 2001, budget constraints are keeping the province from completing it. The highway serves as a symbol of the lack of coordination among Canada's 13 provinces and territories, hobbling commerce in an economy that is struggling to return to full output amid a sluggish global rebound.
Bank of Canada Governor Mark Carney has pressured companies to diversify trade overseas and Prime Minister Stephen Harper has offered to help finance a bridge between Ontario and Michigan. At the same time, provincial governments haven't always been as quick to facilitate trade. British Columbia Premier Christy Clark, for instance, has signaled she won't allow Enbridge's proposed Northern Gateway oil pipeline through her province from Alberta unless it gets a "fair share" of its revenue.
Quebec's Transport Ministry hasn't yet funded the third and final phase of Highway 185's $1.31 billion transformation, according to project manager Simon Lavoie. Finance Minister Nicolas Marceau of the separatist Parti Quebecois, elected last month, said Oct. 5 that the province's deficit will probably exceed a prior forecast of $1.51 billion because of its decision to close a nuclear power plant.
The government is seeking to shrink the deficit and balance its budget by next fiscal year through such measures as the introduction of new tax brackets for people who earn at least $101,300 annually. The Parti Quebecois will need some opposition support for those plans because it won a minority of seats in the election. While the politicians wrangle, Quebec's road construction needs remain.
"The potholes start as soon as you get into Quebec," said Jonathan Lemco, principal and senior sovereign-debt analyst at Valley Forge, Pa.-based Vanguard, which oversees about $1.9 trillion in assets. Lemco, a Montreal native who travels back and forth throughout the year, says the province has "tremendous infrastructure needs – I always check the shocks on my car when I cross over the border."
Canadian Tire, which brings in goods from Asia through the Halifax port and ships rush orders or promotions on trucks rather than trains, uses the Transport Vroom Vroom company in Saint-Antonin, Quebec, and Rejean Rioux's Gilbert M. Rioux & Fils in New Brunswick to break up and re-assemble the trucks.
(Continued on page 2)