Intermodal Shipping Resurges

Something we would characterize as surprising a few years ago, rail is becoming one of the most important logistics systems of the 21st century. With increased technology and improved delivery speeds, rail is moving significantly more freight every year.

According to a recent article by Joann Muller, Forbes Staff writer, “industry-wide, revenues have surged 19% from $67.7 billion to $80.6 billion since 2009, creating 10,000 new jobs at railroad companies and countless thousands in related industries–and paying out $21 billion in wages last year alone, up nearly $1 billion. As the U.S. population swells, the Federal Railroad Administration projects that the tonnage of freight shipped by the U.S. rail system will increase 22% by 2035.”

Railroad companies have also been hard at work investing in improvements to their infrastructures with billions spent over the past several years on maintenance, technology, and expansion. Because of the efficiency with which rail moves freight across the country coupled with the ever-expanding container technologies that offer more refrigerated and temperature-controlled boxes, intermodal is becoming increasingly attractive for shippers.

With an increasing shortage of truck drivers, carriers are having a difficult time filling open positions. This has the result of increasing rates and decreasing reliability with LTL (Less than Truckload) and FTL (Full Truckload) shipping. The American Trucking Association claims that there is currently a shortage of between 35,000 and 40,000 truck drivers nationwide. That is only expected to worsen as the average age of a commercial driver in the U.S. is 55.

It is no surprise that rail intermodal is becoming a preferred method of shipping; it is sustainable, more efficient, and cost effective. If you are considering using intermodal shipping as a part of your supply chain strategy, contact our experts at Langham. They will help you take a look at your supply chain, determine if there are any inefficiencies and create a strategy that will give you more peace of mind.

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