Intermodal rail has experienced tremendous growth as a transportation solution of choice, with volume increasing more than fourfold since 1980, to over 14 million units moved last year. *Several factors in the transportation industry, such as changing shipper perspectives and the macroeconomic environment support the continued projected growth of intermodal rail, including:
- Highway congestion
- Truck driver shortages
- More stringent trucking regulation
- Pressure to reduce transportation spend
- Greater focus on environmental responsibility
- Rising fuel costs
- Organic freight growth from a recovering economy
In addition, investment by Class 1 railroads into fluid and high-performing regional and interconnected national intermodal networks has improved the competitiveness of the intermodal product offering. Efficiency gains – both on the rail and at the terminal – have enabled railroads to meet growing intermodal demand from a more diverse base of shippers, reflecting a broad range of supply chain requirements in an ever-complex transportation landscape. For instance, investment in intermodal terminal coverage and service offerings across rail networks have enabled viable intermodal solutions in nearly all major manufacturing and consumption markets throughout North America, including Canada and Mexico.
In the Eastern United States, intermodal service has expanded aggressively in multiple lanes with lengths of haul just over 500 miles to provide cost and sustainability alternatives to shippers who move freight extensively into and across the East to reach dense population markets. To make these shorter distances work intermodally, CSX Transportation (CSXT) has pioneered the hub-and-spoke network in the railroad space, which creates the most connectivity and offers substantially more service lanes, utilizing its hub in Northwest Ohio.
Enhanced intermodal facilities, such as the above, enable faster operations, with more automation, in a more environmentally responsible way than ever before – all of which benefit the communities we operate in, our customers and other users of intermodal rail.
Given all the challenges facing the trucking industry, we anticipate continued substantial highway to intermodal rail (H2R) conversion by shippers looking to take greater advantage of the value of intermodal rail. Intermodal rail offers shippers:
- Scalable Capacity – Intermodal solutions provide access to a large and growing fleet of both rail-owned and carrier-owned containers, easing shippers’ capacity concerns year-round, including peak seasons. Intermodal scales to meet shipping needs efficiently, with the ability to move the load of 280 trucks on one train.
- Sustainable Savings – Intermodal benefits, such as lower fuel consumption and freight density through double stacking of containers, produce cost savings for shippers and their customers. And the environmental favorability of intermodal rail provides a responsible growth engine for sustainable freight transport.
Are you considering increasing your use of intermodal? Have you recently increased your usage? Please let me know your thoughts on how intermodal aids your supply chain and meets market needs
*American Association of Railroads