Ray, the shipping manager for Cleveland-based Allied Industrial, needed to get 23 pallets of expensive stainless steel and copper sub-assemblies to its customer, a defense contractor in upstate New York.
Intermodal Shipping—it’s Affordable
Some logistics and shipping managers think that sending goods via intermodal freight is for large companies only. That’s a myth. While the above scenario is fictitious, similar sequences are repeated at businesses everyday. And many of the companies choosing intermodal rail are small and midsize enterprises.
Even with cheap fuel and overcapacity in LTL and TL, shippers can save more when they divert to intermodal shipping. In fact, according to a survey of 600 supply chain managers conducted by Wolfe Research, “Companies expect 14 percent of their total over-the-road volumes to go through intermodal in five years.” That’s according to an article originally reported this year on the transportation website JOC.com.
Note, your shipping distance should be at least 750 miles before considering intermodal rail. Any distance less than that is usually not cost effective.
Your freight (ideally on pallets) is placed inside a 20, 40, or 53-foot shipping container and delivered to the railroad yard via truck. Sometimes, these containers are the same containers used on ocean-going vessels. At the rail yard, the container is plucked from the drayman’s truck with an enormous crane and placed on a railcar.
Besides lower costs, intermodal shipping offers other advantages:
Intermodal rail is more secure: Rail yards are more secure than truck stops. Some intermediate rail yards are far from populated areas of cities where access is tightly controlled by railroads. Containers, on the other hand, are picked up and dropped off in or near major cities. All rail containers must be sealed and can only be opened by the shipment’s consignee.
Intermodal rail is more efficient: Trains run on tight, predictable schedules. Trains can also haul a lot more freight than a truck, and thus capacity is very scalable. Much of California’s produce is packed into refrigerated rail cars and sent on 3,000-mile treks across the U.S. Union Pacific estimates it takes about 200 semi-trucks to equal the hauling capacity of a 55-car train.
Intermodal rail is better for the environment: It’s estimated that a single rail shipment can conserve 100,000 gallons of diesel fuel and reduce CO2 emissions by 85,000 metric tons per year, according to Food Logistics magazine. Trucks emit about 19.8 Pounds of CO2 per 100 ton-miles, nearly three times more than train emissions of 5.4 pounds. Overall, less diesel fuel consumption reduces greenhouse gasses and particulate emissions by 75 percent and nitrogen oxide emissions by 80 percent.
Additionally, rail is one mode that should be resilient to the looming truck driver shortage. Perhaps this is reason enough to consider intermodal rail for your next shipment.
Want help planning and shipping intermodal rail? We’ll make sure your freight gets there on time and on budget.