A while back someone challenged my contention that domestic rail service is not taking trucks off the highways, despite claims to the contrary by the AAR. Well, here’s the latest proof that railroads are not taking any freight off the highways…
Quote of note: “Shippers confide that domestic intermodal service appears to be a low priority for railroads, with some shippers declaring it dead.” (my bold)
Stats of note: Import intermodal up 8.6%, domestic intermodal down 0.5%, TOFC down 5.0%.
I had always wondered why the AAR doesn’t differentiate between import and domestic intermodal in their monthly and weekly comprehensive intermodal stats. Now we know.
To those interested, I recommend reading the linked article to see if a person with any critical thinking skills would come to the same conclusion as FM.
Note that domestic trailer on flatcar business is down 7%, but when combined with domestic container business the year to year quarter drop is just 1/2 of 1%.
Do you suppose there might be some relationship between the drop in domestic TOFC/COFC and a decline in the domestic production of products that would be shipped in that mode? Do you suppose that some of the same product may now move in boxcars? With the trucking industry appearantly building some excess capacity, do you think that is causing a softening (decline) in truck rates that might be swinging some of the traffic from rail to truck? If railroads are being pushed on capacity, do you think they should care?
these statistic are more a measure of the manufacturing economy than they are of transportation choices. If domestic cmanufactuing were up - then domestic intermodal would be up as well. All this is showing is the transportation impact of the offshoring of manufacturing.
So those shippers quoted in the article do not have any critical thinking skills? 'Cause that’s where I drew my conclusion. Perhaps Jay will now define “critical thinking skills” for us - “Railroads are right, and everyone else is wrong”(?)
Domestic, in this article is RR controlled trailer and containers - typically IMC business. It does NOT include JB Hunt, Scheider and other truck load carriers that use RRs for line haul. This is a growing LOB for RR intermodal. Truckload volume on NS is up 9% YOY. Truckload revenue is up 24% on BNSF (the same % as International and it is 3x what IMC revenue is)
Your implication that the AAR doesn’t break out different LOBs in intermodal traffic to hide the lack of highway diversions is silly. They don’t break it out because the RRs don’t break it out in their reporting to the AAR! There are no agreed upon definitions of each LOB, that I’m aware of. They just count by equipment type. As for each LOB, each RR does it’s own thing.
I wish they wouldn’t use the percentages. It is too easy to mess it up. It would be preferential for them to give the actual numbers and the percentage change, just to be sure they are not mixing apples and oranges.
Also, I am not surprised to see TOFC dropping. Almost never see a TOFC around here. Almost everything is going container. Cuts weight and cost. Plus there is an abundance of containers. Why ship it all when you can just get the wheels at the next stop? Particularly with fuel surcharges from the railroads and the trucks, you get an added benefit from the double stacks over TOFC.
It would seem insane for trucks to be adding capacity as demand falls. It makes you wonder if they are not increasing local truck hauling capacity to handle all the international and domestic containers once they get to the city where they are going. Containers don’t walk to the customer. If there are more containers in motion, you would need more trucks to get them to the final destination. Might be moving trucks from long hauls of bulk commodities, but you then add trucks for final delivery and short hauls.
The article even says that time sensitive shipments go by truck. Wow, what a revelation. [:O]
The shippers quoted site times as the big factor. If the railroads can get the trains into yards and unloaded, trucks suffer. If my load of widgets can sit an extra couple of days without affecting my bottom line, rail seems to be the winner.
Domestic to a port seems to be a logical railroad win. If the US ships overseas, why pay for a truck to haul the container when the container can be delivered straight to the port by rail? Part of the fall o
and with housing starts down less construction items for housing being shipped also automotive sales way down less parts componets shipped.+ lots of christmass trinkets shipped in to states in int.boxes from communist china.
We have been warning some of the US class one’s that their price increases are helping add a log to the fire that is making product from foriegn sources lower in cost. One Eastern class one will be lloosing a couple hundred boxcars a year from one of our plants as well as about 600 inbound loads a year when we shut a line down late first quarter of next year. I hope they enjoyed the double digit percentage increases while they lasted but they definitely contributed to the closing of that line. That product will soon be coming off ships on the Eastern Seaboard and going intermodal to a distribution point.
Intermodal domestically was helped by the hours of service laws that took effect a couple years ago, it made the distance/drayage considerations shorter to make ecomically feasible the rate structures on domestic intermodal vs over the road in numerous situations.
The article does not differentiate between RR owned boxes and truck load carriers in it’s report on TOFC and domestic COFC. The implication is fairly clear that it’s all going downhill on the domest
Critical thinking skills are something with which you are not familiar. You take one quote from one person who is only identified as a “shipper” with no hint as to what, from where, to where, or how much he ships and you think that define the status of the business. Duh.
Interesting chunk of writing there. Can anyone tell me why these quotes are anonymous? They’re not controversial. They’d add more weight to the author’s point if they were attributed, and attributed to “shippers” of some import.
Having edited news stories for over 30 years, I’ve always been suspicious of anonymous innoculous quotes that just happen to bolster the author’s objective.
To take it one step more, his link does support the title, but doesn’t support the first paragraph. There is no mention whether highway hauled intermodal or trailers were up or down, or by how much, over the same time period.
Leaving Dave’s ideology out of it (PLEASE!), there is a whole new problem here.
In many places, we’re out of railroad capacity. Except for the possible expeptions of the two World Wars, I don’t think this has ever happened before. The railroads are, in signiicant places, “full”. And they’ve got coal mining regions such as the Powder River pumping out loaded coal trains every 20 minutes or so as well as huge, collosal, stupendous ships driving up to docks and disgorging huge, collosal, stupendous trainloads of containers to be moved.
Do the BNSF/UP concentrate on these things and ignore the possible domestic intermodal load of water heaters from Kankakee to Omaha? I’m sure they do. Are rail prices going up? They certainly are. The railroads have to ration their capacity, and the best way to ration is through pricing. (I do think the Iowa Interstate should go after those water heaters. Intermodal is certainly “Open Access” railroading. Why they don’t is a whole 'nother story.)
The worst thing that could happen is for the government to involve itself. This will eventually all sort itself out, unless the government gets involved.
The railroads are increasing their capacity by acquiring cars that can handle more tons, by running longer trains through DPU technology, by laying more track, and by improving their information technology. If the governement responds to the screams of people like the Montana wheat farmers and forces the rail charges down these improvements will be inhibited.
There ae problems. They will be solved. As always.
The article does not differentiate between RR owned boxes and truck load carriers in it’s report on TOFC and domestic COFC. The implication is fairly clear that it’s all go
Don’t these lines from the article imply that Intermodal is competitive, and actually gaining some loadings, from Truckload shipping? It seems to say IMPROVEMENTS IN SERVICE is a reason to shift FROM TRUCKLOAD to INTERMODAL, and that fuel surcharges are keeping INTERMODAL competitive with TRUCKLOAD.
The article seems more interested in MARKET SHARE than TOTAL LOADINGS. It would appear that although total INTERMODAL loadings may be down (an item not addressed in the article), that the Rail Roads may be getting a larger MARKET SHARE of the total amount.
Which supports previous comments related to “If it ain’t made here, we wont get to ship it”.
Shippers don’t know ANYTHING about their truckloads going intermodal or not. That’s whats misleading about this article.
The shipper thinks RR intermodal = IMC (HUB, et. al.) and truck = truckload carrier (JB Hunt, Schneider, Swift, Werner, et. al.). He has absolutely no idea if the load he sends away from his dock in a Swift trailer with a Swift driver will move by highway or rail!
So, the reporter talks to shippers and they say RR intermodal is not as reliable as truckload, so they call JB Hunt more often and HUB less. And then he looks at the TOFC/COFC stats and some info on “domestic” interm