Report on the US freight business

This story contains some interesting information.

http://fleetowner.com/management/news/logistics-report-troubleseome-0610/

The publication orients it toward trucking. It’s a publication for truckers. But the story contains interesting information on freight and the rail/truck situation. As is pointed out, railroads and truckers are more and more partners instead of enimies. “The one bright spot for trucking is intermodal…”

It’s very interresting that BNSF is trying to work with smaller trucking companies. Freight movement in the US is dominated by these smaller trucking firms. So far, the railroads have had very limited success working with these smaller firms. Schneider, JB Hunt, Swift, etc., AKA the big guys, use IM extensively. But they’re only a small part of a large market. If BNSF and the other railroads can successfully work with the smaller truckers it will open up a lot of new business opportunities for rail intermodal.

It’s also very interesting that they’re still talking about a “driver shortage.” Even with persistantly high unemployment, particularly among males 24-54 years old who have a 20% unemployment rate, they’re short on truck drivers. There’s really only one real reason for that. Truck drivers aren’t paid enough. Increase truck driver pay and they’ll get more people wanting to be truck drivers.

Anyway, it looks like a winner for rail intermodal. If they pay the drivers more to get the number of drivers they need it will increase the cost of shipping by over the road truck and divert freight to rail. If they don’t pay the drivers more and remain short of drivers the freight will still be diverted to rail because there won’t be truck drivers to handle it.

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Apparently the industry is having trouble attracting younger drivers. Probably the main reason is they do not like the work environment and do not think it is worth it. I mean who wants to be on the road for weeks at a time especially younger generations. At least that is my opinion.

BNSF seems to be in the perfect spot to do whatever they want since they only have one person to answer to, and he does not care what they do as long as the company continues to make money and seems to encourage innovation of the industry. Time for industry peers to seize this opportunity.