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Home » Significant Changes in Key Intermodal Movements

Significant Changes in Key Intermodal Movements

February 19, 2008
From FTR Associates

According to the Intermodal Monthly Update published by FTR Associates and Gross Transportation Consulting (GTC), weak performance for the intermodal traffic has continued through December 2007. There has also been a major shift for imports to move through East Coast ports, rather than West Coast ports, which will have significant impact on the volume and network planning for last mile delivery of retail movements.

Intermodal revenue moves for the month of December dropped 11% from November. Total 2007 intermodal revenue movements of 14.08 million resulted in a decline of 1.1% from 2006. According to the report, loss of intermodal freight to alternative all-water movement has been a significant drag on intermodal volumes in key long-haul lanes in 2007. "Substantial amounts of import freight that previously landed on the west coast and moved east via long-haul "transcon" intermodal is now landing on the east coast. The trend is most acute in the southern U.S.," says Larry Gross, author of the Intermodal Monthly Update. The intermodal forecast continues to move lower as international equipment movements via rail will remain weak over the next several quarters. FTR and GTC forecast total loadings to grow by only 1.6% in 2008.
Another major finding of the report, according to Larry Gross, the report's author and President of Gross Transportation Consulting, is that large amounts of import freight that previously came into the United States through the West Coast and then headed East through what he described as long haul "transcon" intermodal is now initially coming into the U.S. via the East Coast, particularly in the Southern U.S.

There is certainly some of that going on," Gross told LM in an interview. "If you look at region-to-region intermodal flows, you will see that there are certain region-to-region flows have dramatically dropped...like from the southwest region to the southeast region."

"If there is a good news piece of the puzzle, it is that we don't think things will deteriorate," said Gross. "If you look at past history with truck freight as an example, it shows the recession long before a recession. And if you look at when a recession officially starts, is there is a big deterioration in truck freight at that point? I don't think there is. Going into this [potential recession] with inventories in pretty trim shape and interest rates low, it is hard to see--barring the unforeseen a significant deterioration from where we are sitting now."
http://www.ftrassociates.net

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