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How Will You Benefit From Intermodal Transportation?

Aug 08, 2017

Intermodal transportation uses multiple modes, or carriers, to move approximately 25 million containers each year. In our last post we discussed what intermodal is and how to know when to choose it. You’re probably wondering about the benefits of selecting it. Below are several you’ll want to consider.

Intermodal benefits.jpgScalable and flexible: Many companies lack the ability to scale logistical operations in response to varying demands throughout the year. Those utilizing an intermodal framework, rarely struggle with this issue. A single train has the ability to move the load of 280 trucks. This translates to the equivalent of having an entire fleet at your disposal, plus North America’s comprehensive rail network makes it possible to send shipments cross country, and everywhere in between, with ease.

Time efficient: Railroad shipping schedules and transit times have improved significantly. Twenty years ago shipping via intermodal coast to coast used to take two-weeks. Now it’s only about seven to eight days. Not only that, intermodal moves goods from point A to point B with less distractions and delays from traffic patterns, weigh stations, and other issues related to trucking.

Cost effective: Intermodal is about 2-3 times more fuel efficient than OTR (over the road) transportation. Since a single intermodal train can transport the equivalent of 280 truckloads, it offers higher fuel efficiency. Trains can also carry greater loads, because containers can be double-stacked, resulting in overall increased productivity. A freight train can move a ton of freight about 430-500 miles on a single gallon of diesel fuel. This increased fuel and freight efficiency helps shippers save 15-20% on shipping costs, especially for distances exceeding 800 miles. This is where intermodal rates are far cheaper than shipping via truck. However, shorter routes often make more sense as over-the-road moves. 

Another cost effective benefit of intermodal is that container fees are minimal in comparison to that of full truckload. This makes it an excellent choice when you need to make additional space on your dock or prepare and load a shipment over the course of several days. 

Environmentally friendly: If your goal is to improve your carbon footprint, intermodal is an excellent choice to consider. Intermodal rail is fuel efficient and very environmentally-friendly compared to OTR transportation. According to the Environmental Protection Agency (EPA), replacing OTR with intermodal transportation for shipments exceeding 1,000 miles reduces greenhouse gas emissions by sixty-five percent. Statistically, railroads are also considered to be a safer mode of transportation for hazardous material. According to the EPA, trucks have approximately 16 times more hazmat releases than railroads. Efficient use of fuel means less greenhouse gas and carbon pollution, plus less hazmat spills, means that intermodal definitely offers environmental benefits over trucking.

If your shipping partner is certified under the EPA’s SmartWay program they can better guide you to the most environmentally-friendly carriers and methods of shipping. 

Optimizes driver capacity: Since 2015 there’s been a growing shortage of drivers in the trucking industry. This is attributed to a rising number of retirees and reduced number of new recruits. Regulations limiting the number of hours drivers can be on the road, plus other recent safety regulations, have worsened the crunch. Rising costs, partially attributed to higher rates paid to attract new drivers, has made OTR transport more expensive and intermodal more attractive and cost efficient. Since the driver shortage has been especially significant for long-distance road hauls, it’s an advantage that intermodal utilizes the greater capacity of local truckers.

Improves safety and reduces risks: Shipping via rail is considered to be much safer than other methods. Railroad police continually monitor intermodal transportation plus it’s possible for shippers to place GPS trackers in rail cars to decrease the chances of losing shipments.

Since long distances are usually handled by rail in intermodal, shippers have far less exposure to roadway collisions and fatalities. This results in higher freight reliability that translates into smoother, more efficient operations. 

The use of standardized freight containers for intermodal means they’re easily transferred from one mode to the next. This eliminates the risks of damages and loss from directly handling shipments. 

Data collection and monitoring is easy: What used to be one of the biggest drawbacks of intermodal is no longer a challenge. It used to be difficult to monitor, collect, and assess data relating to a shipment traveling via intermodal because it uses a combination of different modes and carriers with separate tracking platforms. Now that there’s a cloud-networked platform, used by all involved carriers, these processes are more efficient and effective.

In times when companies are seeking increased efficiencies in their supply chain operations, intermodal meets these needs with its many benefits. Ongoing intermodal infrastructure development, along with continual improvements in technology, have further improved freight efficiency for companies. Trying to figure out how you can take advantage of the benefits of intermodal transportation? Contact American Group by phone at 866-553-6608 or by email at Rates@ShipAG.com. We are SmartWay certified and have the experience to help you select the best shipping solutions for Shipping.Simplified®.

 

Photo credit: Copyright: <a href='https://www.123rf.com/profile_kokandr'>kokandr / 123RF Stock Photo</a>