TRANSPORTATION INFRASTRUCTURE
transportationreport
Rails try new route to
intermodal growth
Intermodal’s
future may lie
not with what
comes off the
boats, but
what comes
off the roads.
FOR DECADES, INTERNATIONAL COMMERCE HAS DICTATED THE RULES OF
engagement in the U.S. intermodal industry. Seagoing containerized imports were offloaded
at U.S. ports of entry, transloaded onto railroads, and moved inland.
That business is hardly going away. However, the days when domestic intermodal operations were viewed strictly as a “bolt on” to international service that involved a prior or subsequent ocean freight movement are fast becoming history. Today, the four U.S. Class I railroads are putting greater emphasis than ever on the domestic market as they look for ways to
fuel intermodal growth. In so doing, they will try to move beyond their comfort zone of near
2,000-mile hauls and muscle in on the short- to intermediate-distance markets dominated by
truckload carriers.
To be sure, it isn’t a zero sum game. Collectively, the trucking industry is the country’s
largest intermodal user and has for years relied on the service to cut its linehaul costs. UPS
Inc., known to many as a ground carrier, is also the single biggest intermodal customer.
However, there are still many shippers who will not use intermodal service and depend
exclusively on truck, a fact that railroads know all too well. For example, the Burlington
Northern Santa Fe Railway (BNSF) estimates its customers use intermodal for only about
one-quarter of their total transport needs.
