Knichel News

The Intermodal Value Proposition

train bridge.jpgFollowing last week's post about what works for intermodal and what doesn't, we thought you might be curious about the value proposition of intermodal transit. Below is a breakdown of the benefits of rail shipping:

1. Price

For long length hauls (those exceeding 1000 miles), intermodal pricing can be particularly price competitive with motor carrier pricing, often yielding a 10 to 25 percent cost savings.

2. Capacity

Intermodal can be a significant source of capacity, particularly in peak season surges when freight capacity is tightest.

3. Negotiation Leverage

Many customers have found that a major presence in intermodal has allowed them to exert pricing leverage on their motor carriers, or at the very least maintain better stability on their motor carrier pricing.

4. Less Fuel Cost Volatility

Since intermodal is inherently more fuel efficient than over the road, a significant spike in fuel costs results in less dramatic cost increases than motor carrier pricing. 

5. Sustainability 

Intermodal rail is the most environmentally friendly mode of freight transport. According to CSX, rail can move a ton of freight nearly 450 miles with just a single gallon of fuel. That's impressive!

 

There is so much to learn about intermodal shipping! If you haven't had a chance to read over our Ultimate Intermodal Guide yet, feel free to do so here:

Download our Intermodal Guide