Answers
Gowdy: The most notable changes in the perishable arena have been growth in the container-on-flatcar marketplace, as well as the number of carriers traditionally focused on over-the-road service that have entered the intermodal market.
The advantages remain the same in terms of access to capacity and pricing, but the recent trends have changed the competitive landscape as well as opened up a variety of new lanes that traditional intermodal carriers have struggled with in the past.
Sanford: The service has gotten so much better. The expedited rail network has made it possible to cross the country in five to six days—which is comparable to a single driver. With the hours of service changes, intermodal may be faster than over-the-road depending on the lane.
McKenna: We have seen a shift in the mentality of the railroads to be more customer-centric; service schedules have improved to make rail transport much more competitive in terms of transit time. Capacity is a huge advantage during seasonal spikes, and weather delays are basically nonexistent.
Question
Which types of investment—service area, capacity, infrastructure, marketing, etc.—do you think are most important in convincing customers to try intermodal?
Answers
Gowdy: I would point to service areas/lanes of traffic and increasing capacity as the two primary selling points. As more carriers enter the market and more lanes are opened up in the rail network, theoretically, the service becomes more “truck-like” and easier to grasp as a supply chain solution.
Sanford: As over-the-road challenges continue to increase such as driver shortages, hours of service, emission requirements, etc., the shipping public will have no choice but to try this mode of transportation.
Railroads are spending billions of dollars to improve the network with increased engine and flatcar inventories. They’re adding more and more articulated flatcars, which make for a smoother ride, as well as improving the rail lines with double tracking to allow for increased speed. They are in the ‘ready’ position.
McKenna: Service area and capacity are key to converting customers to intermodal shipping, but education is the biggest factor.
Many shippers simply do not realize how reliable rail transit times have become. With the correct timing, there are lanes where rail can be directly competitive with over-the-road trucking; on the shorter lanes, it can be only a one-day difference. Educating customers to these improvements often results in new intermodal business.
