Intermodal Capacity: How it is Determined and What Affects it
For some people, shipping freight via intermodal (rail) can be an unknown entity, filled with pitfalls and frightful uncertainty. Truth is, intermodal really isn’t that complicated, however there are more variables and moving parts than a straight Over-The-Road (OTR) movement.
When planning an intermodal shipment, it all starts with determining capacity. Several factors can affect capacity, the first being the lane itself. Is this a lane that is serviced by an intermodal carrier? Just because there may be a rail ramp in a specific area, it may not be an intermodal terminal resourced with the equipment to load containers. Along these same lines, if the shipper or receiver are located an excessive distance from the origin or destination rail ramp, it may not be prudent or fiscally beneficial for a carrier to offer a rate for the requested lane. As an example, if the shipper is 227 miles from the nearest intermodal rail terminal, it will probably not be prudent for a carrier to offer rates or capacity for that specific lane, as the time, mileage, and fuel costs to make this pick-up will not prove financially beneficial for the carrier.
For basic capacity consideration, find out if the carrier has enough dray carriers available for the date and time that you want to move a shipment. Most of the door-to-door carriers use a combination of company carriers and contracted partner carriers. Regardless, a carrier will only have a finite number or drivers and trucks.
The next factor to consider is the availability of equipment, namely serviceable containers. If a carrier does not have or anticipate having enough containers to meet customer demands, they will most likely not offer capacity for that specific area or region. Until container resources reach a specific quantity, they will not be able to meet customers’ demands.
Another lesser factor to consider is the ultimate destination for your shipment. If you are shipping a load from California to New Jersey during peak season, rates will typically be higher and capacity will be reduced because most customers want to ship from West to East, which ends up stock piling their equipment assets on the East coast. If you are shipping a load to a destination that is less lucrative for the carrier, you will also most likely see higher rates and a more limited capacity.
On the other hand, if you wish to ship from East to West during peak season, equipment will most likely be plentiful, with the critical factor being drivers and trucks. Keep in mind that these same drivers will also be loaded up with deliveries from all of the inbound freight coming from the West, which will affect capacity. During this same peak season time frame, most carriers will be anxious to get their equipment re-positioned back on the West coast in order to get more shipments, so they will typically offer much cheaper rates moving East to West.
During this past peak season, we experienced minimal capacity issues compared to years past, as many carriers have expanded their pool of drivers in order to meet increased customer demands.
If you can work around the factors above, and have several extra days to move the freight, utilizing intermodal/rail can be a very cost-effective solution to your needs.
If you have any further questions about the issues that affect intermodal capacity or associated intermodal topics, or if you want a quote, please reach out to our Trinity Logistics Intermodal Team at 866-811-4312 or via email at email@example.com. We will be happy to field your questions or assist in any way possible.