FTR’s Intermodal Competitive Index (ICI) rose in October 2016, reflecting a moderately favorable environment for intermodal transportation. The ICI looks at a variety of factors including truck capacity, fuel prices, rail service, intermodal rates, and more.
Larry Gross, Partner at FTP and principal author of Intermodal Update said, “The fundamentals in the domestic long-haul freight sector are beginning to turn in intermodal’s favor. Truck capacity is starting to tighten as shown by increasing spot market trucking rates. While competitive conditions for intermodal remain challenging, we do expect to see sunnier skies in the coming months.”
Gross goes on to explain that intermodal has not seen a true decrease since the recession, with total activity split between intermodal and domestic container and trailer moves.
The key infrastructure to successful intermodal service is the location of the ramps. Specialized equipment is required to lift containers and trailers onto and off of the railcars. The system requires special gate control procedures, container inspections, storage areas for chasses and containers and other facilities that are not typically available at a general purpose rail yard.
Railroads develop scheduled train service between modes. The trains run as units with no stops between origin and destination. This prioritization allows intermodal traffic to provide more predictable and faster service than traditional carload rail service.
A drayman is a specialized motor carrier that does the short-haul between the ramp and the loader or unloader. The drayman could work directly for a carrier coordinating the load or he could be a contractor for an IMC. The dray company may own their own chasses (the trailer framework used to haul the container), or they may draw these from a pool at the ramp.
Many shippers that transport high volumes of freight have invested in their own containers. Some domestic containers are controlled by logistics companies. Other containers are owned by railroad-controlled pools.
Ocean vessel companies typically provide containers that the cargo in which the freight ships on their vessels. This can create opportunities or challenges for the domestic leg of an import or export shipment. If relying on a carrier’s container to load at your origin, the shipper is dependent on a flow of containers from that shipping line into the region. As with other transportation, where there is a strong inbound flow, there is an opportunity for backhauls. But, the opposite is true when a container needs to be moved by empty miles to get loaded.