News & Events

Collaborative approach to regional freight hub

Thursday June 6 2019

Collaboration is key to the successful development of a new regional freight hub near Palmerston North, says Todd Moyle, KiwiRail Deputy Chief Executive.

In November 2018, KiwiRail was awarded $40 million through the government’s provincial growth fund to design, designate and purchase land for the hub.

Today KiwiRail, the NZ Transport Agency and Palmerston North City Council signed a memorandum of understanding outlining how the three organisations will share information and work together as the freight hub project progresses.

Mr Moyle says developing a modern road-rail hub near Palmerston North is crucial for managing the growing freight volumes through Manawatū.

“Palmerston North is already a critical freight distribution point for the lower North Island, with goods coming through from the upper North Island, Taranaki, Hawke’s Bay and Wellington, and freight volumes are expected to increase significantly in the coming decades.

“There is a real opportunity here for regional development, but to make the most of those benefits it’s crucial that the hub development is aligned with the Transport Agency’s roading plans in the region, and the council’s economic development plans.

“The memorandum is part of a strategic approach to ensure all of the interested parties work together to deliver a final result that achieves the range of outcomes we want.”

The agreement bodes well for future transport initiatives in the region, says Emma Speight, Transport Agency Director of Regional Relationships.

“We are looking forward to deepening our working relationship with KiwiRail and Palmerston North City Council to ensure we maximise these exciting new opportunities.

“The Transport Agency is leading investigations into transport improvements around Palmerston North, and the new freight hub will complement this future transport planning.

PNCC Chief Executive Heather Shotter says signing the memorandum signals a significant commitment between the three parties.

“Our regional economy is set for unprecedented growth, with more than $3 billion of public and private sector investment planned over the next 10 years.

“The council has already established a new industrial zone on the outskirts of the city to encourage growth of our logistics industry.

“The creation of this regional multi-modal hub will be a major drawcard for attracting more logistic firms into the region.”

Hub benefits

Reducing transport emissions and roading costs: Every tonne of freight carried by rail has 66 per cent fewer carbon emissions than heavy road freight. Getting more freight on rail also reduces road maintenance costs and improves road safety.

Taking pressure off city roads: Situating the hub outside Palmerston North and integrating it with the Transport Agency’s planned integrated transport improvements will help take freight traffic out of central Palmerston North and reduce congestion. The hub will also link to the Te Ahu a Turanga: Manawatū Tararua Highway project (the new SH3 route across the Ruahine Ranges).

Growing the logistics industry in Manawatū: KiwiRail will also work with key customers on major infrastructure requirements to encourage logistics and distribution businesses into the area, to help grow the sector and create more local jobs.

KiwiRail is currently working on the design of the regional freight hub and will be undertaking a multi-criteria analysis to identify potential sites and a preferred site, as part of having the land designated for rail use.

The $40M PGF funding covers the cost of design, designation and land acquisition. The construction phase of the hub project is expected to be three to five years away.