L ike many logistics functions over the past few years, the intermodal market has faced several signicant challenges. At the same time, these challenges offer an opportunity, and intermodal transit remains a valuable element in many organizations’ logistics operations. CHALLENGES IMPACT INTERMODAL VOLUMES As of late April 2023, intermodal volumes were off the ve- year average by approximately 28,000 carloads per week, says Todd Tranausky, vice president, rail and intermodal with FTR Transportation Intelligence. A big reason is the drop in imports, and particularly those arriving at the West Coast, where more imports leave via rail. During the rst three months of 2023, the Port of Los Angeles handled about 1.8 million twenty-foot equivalent units (TEUs), down 32% from 2022, which was the best rst quarter in the port’s history. Conversely, over the past few years, the ports in the southeastern and northeastern regions of the United States have gained modest amounts of market share, Tranausky says. This matters to the intermodal market, as imports arriving in, say, Savannah or New York, must travel only about 500 miles to reach midwestern markets, while those coming from the West Coast might travel a few thousand miles, making rail more competitive. Approximately 85% of imports arriving at the Port of New York and New Jersey leave via truck, while about 85% of those leaving the ports at Los Angeles and Long Beach travel via rail. The diversion of cargo away from the West Coast is likely to last at least until the labor contract situation at the West Coast ports is resolved, Tranausky estimates. The longer the impasse continues, the more likely shippers will have developed relationships at other ports, “making it harder to just ip a switch and go back,” he adds. Reduced buying by retailers, many of which are holding high levels of inventory, means lower import numbers, says Shelli Austin, chair of the Intermodal Association of North America and president and co-founder at InTek Freight & Logistics. The value of imported consumer goods dropped by $3.7 billion in February 2023, the U.S. Bureau of Economic Analysis (BEA) reports. Intermodal solutions boost shippers’ options and o¢er key advantages. Here’s why intermodal transport remains key to eciency and how one port stacks up advantages.
May 2023 • Inbound Logistics 85
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