Remember the Bill Murray movie Groundhog Day? The premise was that his character was trapped in a time warp that had him continuously reliving the same day.

The people who work in the intermodal industry can probably relate—except it’s not their industry that’s stuck in a time warp. It’s their image.

Intermodal transportation can take several paths, but the most common application is a truck on both ends for pickup and delivery, with the long-haul accomplished via railroad flatcar service for trailers. Intermodal, in this context, is rail-dependent.

While railroads have made substantial service improvements in recent years, many shippers continue to hold on to an outdated concept of what moving product via intermodal really entails. As a result, they’re missing out on some potentially impressive transportation values.

With that in mind, allow me to suggest five ways your perception of intermodal might be a little off track.

1. You think truck/rail/truck transportation is slower than a straight truck move. Many people labor under the illusion that a straight truck move is the fastest way to get ground shipments from Point A to B. That’s not always the case.

Most regional trucking freight is delivered in 48 hours. By contrast, a shipment that travels 1,000 miles or less using a combination of truck and rail will reach its destination in 48 to 72 hours. Tack on an additional day for every 500 miles after that. So the speed difference isn’t as substantial as you might think.

2. You think intermodal service is unreliable. Due to a flurry of mergers in the 1990s, the rail industry developed a reputation for being only moderately reliable. Its on-time delivery percentage was miniscule for a time and more than one shipper came away with a horror story to tell about how its rail carrier dropped the ball on making an intermodal deadline.

But times have changed—and so have rail carriers. Simply put, they know why you don’t use them as often. And the four major carriers have invested millions of dollars in people, infrastructure, and equipment to improve their service levels and regain your respect.

More importantly, these rail carriers are posting some highly reliable on-time numbers. For example, intermodal service levels are now consistently above 95 percent and they’ve risen to 98 and 99 percent on the most heavily traveled lanes. That’s on par with what an efficient trucking company will do.

3. You think intermodal equals more opportunities for damage. Pure trucking advocates would like you to believe that customers who use a combination of truck and rail experience more shipment damage.

But that’s not necessarily true. In fact, if a shipment is properly loaded, it will be subject to no more damage over the rail than it would over the road.

Granted, you may have to use more blocking and bracing. But railroads and intermodal transportation companies address these types of challenges every day and have developed solutions and improved customer service standards to better meet these concerns.

4. You think railroads don’t think they have to compete. As transportation modes go, rail is by far the smallest industry in terms of the number of available carriers. Thanks to consolidation and mergers, today there are only a handful of North American carriers, and each specializes in certain corridors because of the track it controls.

But don’t let that mislead you into thinking that rail—and by extension, intermodal—is a non-competitive transportation mode. Although they’re really not going head to head with each other, railroads are fully aware that almost all of their potential customers (with the exception of captive shippers) could just as easily move their goods via truck—and that most of them do.

As a result, you’ll find anything but a “take it or leave it” attitude when dealing with rail carriers. In addition to offering different levels of speed and service, most are working closely with trucking companies to develop a variety of flexible road/rail combinations in an effort to better meet their customers’ intermodal needs.

5. You think intermodal has to equal extra trouble. Common wisdom would have us believe that the more often shipments change hands, the more complex the logistics involved—a fact that has deterred some companies from taking advantage of intermodal economies.

These companies do not relish the possibility of having to arrange for an origin, dray, line haul, and a destination dray—or having to manage the dispatching, tracing, and accounting for each. Often, their accounting departments aren’t very keen about intermodal either, because they get three separate bills of lading, rates, and invoices.

This may be true of “traditional” intermodal services, but the industry is changing. Today, there are service providers that offer single-source alternatives for truck/rail/truck transportation. Your materials still change hands, but you don’t have to sweat the details, and that can be worth a lot. The shipper sees a truck at origin and the consignee sees a truck at destination—all on one bill of lading—just like a trucking company.

By Tom Piatak @ www.inboundlogistics.com

Every year, nearly 25 million containers and trailers are moved using intermodal transportation. Electronics, mail, food, paper products, clothes appliances, textiles and auto parts all take a ride on the country’s intermodal network.

In fact, intermodal is growing faster than any other mode of transportation. Why? Because intermodal combines the best abilities of different transportation modes to deliver service, savings and solutions to shippers.

By working together, trucking companies, intermodal marketing companies, ocean steamship lines and railroads are providing a cost-effective, seamless, reliable, efficient, safe and environmentally friendly way to move freight from origin to destination. Throughout the process, intermodal facilitators, or third-party logistics providers, arrange for each piece of the move from pick up to drop off.

Reliable:
Today, all parties in the supply chain use state-of-the-art technology to monitor shipments every step of the way. With real-time information, today’s intermodal companies are keeping track of schedule changes and watching out for their customers’ shipments so they don’t have to.

Efficient:
The days of sacrificing speed for savings are over. Intermodal transportation provides shippers with reliable, consistent service with cost savings compared to over-the-road transportation.

Safe:
Intermodal transportation is safer today than ever before. With high-tech lift technology and articulated intermodal railcars, damage to freight is minimized. According to the Association of American Railroads, in 2003 Class 1 railroads charted the lowest freight loss and damage statistics in more than 10 years. In fact, in a study done by the AAR in June 2004, the ride quality environment on the railroad is similar to the ride quality on the highway.

Environmentally Friendly:
Imagine getting 250 miles to the gallon for your SUV. It’s possible if that SUV were riding on the rails. Railroads move one ton of freight an average of 405 miles on a single gallon of gasoline. And according to the Environmental Protection Agency (EPA), railroads account for just nine percent of total transportation-related nitrogen oxide emissions while also alleviating highway congestion.

By Intermodal Association of North America (IANA) @ www.intermodal.org

One of the top supply chain trends impacting the transportation industry today is intermodal transportation. Over the past few years, capacity has been squeezed with driver shortages, increased demand, increased fuel prices, and heightened government oversight. All these extenuating circumstances affect everything from pricing to timing of loads, and executives are looking for the answer in maintaining a cost-effective supply chain.

Intermodal transportation has provided one such solution. While traditionally carriers strictly sell the advantages of their own modes, this approach to transportation is quickly becoming outdated in our global society. It’s becoming clearer that shippers need to take a more integrated approach to keep pace with economic expansion and consumer demands.

A good example of the success of a business sector integrating their processes to keep pace with the economy is mobile phones. In the 1980s, mobile phones had one purpose: to make phone calls. But, as the economy rapidly expanded, simply making a phone call no longer met business needs. The technology industry integrated talk, data, and connectivity to allow for communication at anytime, anywhere in the world.

Today, logistics executives are taking the same approach to addressing the capacity squeeze by integrating the different modes of transportation: rail, truck, air, and sea. With the economy going through one of its slowest periods of expansion in history, shippers are exploring different ways of integration before everything ramps back up.

The most successful integration undertaking has been with intermodal rail. Shippers across the nation discovered in recent years that intermodal rail proactively addresses the need to meet both current and future business demands as the economy continues to expand.

The concept of intermodal transportation has been around throughout supply chain history. In the United States, the first major efforts to integrate modern transportation systems began in the 1960s. This started with setting maritime networks to better connect with inland networks. However, this was strictly either ship-to-rail or ship-to-truck. Now, the idea of using both rail and trucks is gaining momentum for a variety of reasons, including cost savings, environmental benefits, and highway safety results.

Rail traffic for 2013 saw record growth, with intermodal volume totaling 12.8 million containers and 14.6 million carloads, according to the Association of American Railroads (AAR). This represented the highest volume on record, surpassing the record totals in 2006 by more than 549 thousand units.

As our nation continues to recover from the Great Recession and spending and production pick up, the transportation industry needs to prepare for an influx of traffic. With shrinking capacity from the driver shortage and increased fuel prices, trucks alone can no longer handle our nation’s transportation needs. As there is no positive change on the horizon for truck capacity, this trend is expected to continue and shippers continue to look for alternatives.

With intermodal transportation, shippers can take advantage of lower rates, more predictable pricing, and the flexibility of loading and unloading goods in a dropped trailer environment, which reduces handling costs. This significant cost savings can greatly outweigh the speed by which shippers can move their goods via truck alone. Further, with fewer drivers on the road and fewer hours by which drivers are allowed to work, companies need to maintain their level of efficiency with pick-ups and drop-offs, which in many cases can no longer be handled by truck alone.

Intermodal transportation also provides shippers with more access to equipment and standardized transit schedules. This translates into reliability, capacity, and safety advantages. As companies move their freight to intermodal, they will also be able to streamline their reverse logistics.

In addition, as the U.S. government continues regulating companies for environmental impact, shippers are looking to reduce their carbon footprint. Trucks emit approximately 19.8 pounds of carbon dioxide per 100 ton-miles. Compare this to trains, which emit 5.4 pounds of carbon dioxide per 100 ton-miles. Until manufacturers develop a cost-effective fleet with a significantly reduced carbon footprint, intermodal rail will continue to be the most environmentally friendly mode of inland transport. By taking an intermodal approach, executives have solid proof that that they are being proactive in complying with current and future government regulations surrounding the environment.

When rethinking their logistic strategies to deal with tightening truck capacity, company executives need to seriously look at how intermodal transportation can benefit their business. It provides significant cost savings, increased reliability, greater capacity, and offers substantial green and safety advantages.

By Jeff Vielhaber @ www.inboundlogistics.com