Truck load (TL) provider, Swift Transportation also noted
strong intermodal growth and announced it would add 2,000 intermodal containers
in the second half of 2012 to pursue further opportunities. JB Hunt reported a 13%
increase in both intermodal revenue and volume. In fact, 60% of its total
revenue is derived from intermodal services.
So, what’s behind this growth? As noted in the previous Ti
briefing, “Growth forecast for trucking may be optimistic”, among the
reasons for the growth include high congestion and truck driver shortages,
conversion of boxcar traffic and investments in rail networks. This investment in rail networks has
particularly paid off for the Class I railroads, especially in the Eastern US.
CSX and Norfolk Southern have invested in intermodal corridors such as National
Gateway which connects the East coast ports to the Midwest and the Crescent
Corridor which connects the Southeast to the Northeast markets.
Recently, South Carolina’s Port Authority announced plans
for an upstate inland port. In
conjunction with Norfolk Southern, the estimated $23m project would ease
congestion on the state’s crowded interstate system as well as container
buildup at the Port of Charleston. The
inland port would be located near the Greenville-Spartanburg International Airport,
BMW North America manufacturing plant, Michelin and Adidas facilities.
Just up the road in Charlotte, North Carolina, Norfolk
Southern recently broke ground on another such facility. The 200-acre intermodal
hub, next to the Charlotte Douglas International Airport is expected to open
late 2013. “Charlotte is a key hub on the Norfolk Southern intermodal system
and on our Crescent Corridor, a new rail intermodal network under development
stretching from New Jersey to Memphis and New Orleans,” says Wick Moorman,
chief executive of Norfolk Southern. “This facility will greatly expand our
ability to handle intermodal traffic and move more freight off the nation’s
overburdened highway system and onto the rails.”
The growing intermodal hub networks appear to be a
transportation option many shippers are taking advantage of. For second
quarter, rail intermodal loads increased 4% and for the first half of 2012
intermodal loads were up 3.3%. The second half of 2012 is a bit questionable as
possible signs of an economic slowdown may slow domestic intermodal rail
growth.
