By Paul Scott Abbott, AJOT While the overall economic picture continues to be ailing, freight transportation industry leaders have received a healthy dose of optimism when it comes to the future of intermodal shipping. As the Intermodal Association of North America’s 29th Intermodal Expo, the National Industrial Transportation League’s 104th annual meeting and TransComp Exhibition, and the Transportation Intermediaries Association’s fall meeting were held Nov. 13-15 in Atlanta, some 2,500 registrants repeatedly heard the virtues of intermodal as a cost-effective, energy-efficient means for moving growing cargo volumes. “We see that intermodal’s best days are before us,” said William G.M. Goetz, a Bala Cynwyd, Pa.-based resident vice president of CSX Transportation. Goetz noted that money for highway construction is hard to come by and that building roads poses land condemnation challenges, while economics favor intermodal, as railroads operate on private rights of way, their users pay and the railroads pay taxes rather than exhaust them. With multibillion-dollar private investments in infrastructure from railroad companies, the intermodal option is becoming increasingly popular, according to Goetz, who said, for example, that rail volumes from the Port of New York and New Jersey have grown at a compound annual rate of 14.6 percent over the past 20 years, while overall cargo growth at that port’s facilities has been at a 5.6 percent pace. Speaking on another panel, Richard M. Larrabee, director of the Port Commerce Department of the Port Authority of New York and New Jersey, said about 80 percent of the 5.4 million twenty-foot-equivalent container units that move through the port continue to go by truck, but that percentage is shrinking as investments are made by Class I railroads CSX and Norfolk Southern and the authority’s ExpressRail system.
Referring specifically to the perceived impacts of Panama Canal expansion project, on target for 2014 completion, Larrabee said, “I think there’s going to be a higher demand for intermodal service.” Others on the panel with Larrabee echoed that sentiment. Bill Rogers, vice president for operational effectiveness at chemical distribution leader Univar, said safety, reliability and cost-effectiveness are the key reasons he sees his firm turning to more intermodal as logistics for the company’s more than 100 U.S. facilities are consolidated. “Univar is not a big intermodal player yet, but we aspire to be,” Rogers said. Wilson Lester, senior vice president of supply chain at drugstore chain Rite Aid, said intermodal transport is consistent with his company’s sustainability objectives – an observation supported by Greg Fox, executive vice president of operations for BNSF Railway, who said rail is between four and five times as efficient as other modes. Fox noted that intermodal is the fastest-growing segment for BNSF and that trucking-rooted J.B. Hunt Transport Services Inc. has emerged over the past decade as one of BNSF’s major shippers. J.B. Hunt’s executive vice president, Paul Bergant, said he sees intermodal growth accelerating as fuel prices continue their upward spiral and impacts worsen from trucking capacity shortages and roadway infrastructure insufficiencies. In a separate discussion, logistics executives from a diverse array of shippers shared their enthusiasm for intermodal shipping. “The performance of the rail and the intermodal has improved dramatically,” said Mike Cramer, director of logistics and customer operations at fiberglass manufacturer Owens Corning Corp., who cited favorable cost, service and sustainability as key attributes. Cramer said he believes that even a slight economic rebound will – along with regulatory constraints such as reduced time behind the wheel – lead to further capacity and driver shortage issues for the trucking industry. Gary Palmer, senior director of transportation for hardware cooperative Tr