(Graphics created by Emily Ricks)
Responsible freight management parties have a duty to understand how their enterprise goals impact others. That includes potential impact to the environment, social causes and governance structure and their impact on routing guide compliance. Together, these form what’s collectively known as ESG values, and in today’s world, intermodal shipping and ESG are closely intertwined.
The reason behind this comes from the significantly stronger sustainability advantages within intermodal. As an example, World Finance reported that Bryan Trucker, Vice President of Corporate Communications at CSX, stated, “CSX became the first U.S. Class 1 railroad to operate at a fuel efficiency rate of less than one gallon of fuel per 1,000 gross ton miles.” Let’s juxtapose that against trucking fuel efficiency rates of around 10-20% of that amount. That effectively means rail is up to 10X more efficient than sending a shipment by truck. And that means it’s significantly more sustainable. But to further that argument, let’s take an in-depth look at the benefits and disadvantages of intermodal shipping load planning, when to choose one over the other, and a few core SONAR insights to maximize value.
Intermodal shipping offers significant benefits across a variety of core transportation concerns. For instance, consider these benefits and their value:
While intermodal freight does possess qualities that make it attractive to those interested in pursuing ESG initiatives or simply lowering freight spend, it can come with some drawbacks. These include:
Determining when to choose intermodal freight transport can be troublesome, especially with today’s changing market dynamics. However, the top indicators for when intermodal might be a better option over truckload include:
Like intermodal freight, there are also indicators of when to use truckload transportation over intermodal. A few leading signs that cargo is better suited for truckload shipping include:
And lastly, the primary factor goes back to knowing when to start considering expansion of intermodal freight use in conjunction with rebidding on existing lanes. For reference, the top indicators that existing carrier and mode use are contributing to higher costs, as well as predictive rates, which may further suggest an opportunity to tap the value of intermodal, include:
A tactical supply chain relies on data and facts to guide all activities. That includes onboarding new lanes, expanding into new order fulfillment centers, considering the overall needs of fleet management and recognizing when existing operations fall short. The best-laid plans will come to a halt without a strong understanding of market conditions and near-real-time insights to account for changes and knowing when to switch from OTR transport to intermodal freight or vice versa.
That’s where FreightWaves SONAR and SCI’s Lane Acuity can add value by helping organizations learn from the collective data-consciousness of the industry. And by combining that with the Intermodal Contract Savings Indices, including IMCSI1.USA and IMCSIF.USA, freight management parties can have a better view of when to move truckload shipments to intermodal freight. Request a FreightWaves SONAR demo to see the IMCSI tickers in action, and request a FreightWaves SONAR SCI Lane Acuity demo to propel your full transportation procurement strategy to its greatest potential.