Source: World Freight Focus
Intermodal Freight Volumes Increase on US Railways
BY RICHARD SHRUBB, JANUARY 13, 2015
Though dogged by poor service, US intermodal freight volumes on the railways increased by 3.9% last year, reflecting the overall growth in the US economy. There will be more rail intermodal freight if the issues posed by congestion, bad weather, locomotive and locomotive crews shortages can be dealt with in the next 12 months.
13.5 million containers were carried on US railroads last year, an increase of 3.9% on the previous year according to the Association of American Railroads. There could be a greater increase should the poor service provided by railroad businesses be improved.
Last winter was very bad due to the stalled arctic weather system over the Midwest and New England. This led to significant delays in cargo across the country. Though extreme weather is part of life for freight forwarders in the US, the network buckled under stress and could not cope. New systems have been put in place at hubs such as Chicago to better deal with future weather events of this kind.
Due to the demands of the Texas and North Dakota shale oil boom, a large number of locomotives were diverted to routes serving the oil fields. This led to a shortage of locomotives and crews elsewhere in the country. With the OPEC price war against the US, many shale oil companies are now filing for bankruptcy and for the time being, the oil boom has turned to bust. This may well allow more locomotives to work on the traditional routes serving farms and factories.
Whether such problems surface again will have an impact on intermodal volumes. A poor service drives customers away, while a good, reliable one encourages more clients to do business with you. In twelve months, the AAR will report on whether this simple rule of business has been observed.