Intermodal transportation has been a primarily under-the-radar transport solution for a long time. As a combination of modes, it can offer a healthy balance of transportation speed, reliability, and cost. More and more businesses are looking at intermodal because it provides an alternative to standard trucking or rail. Though intermodal transportation links several transportation modes, it can often be more efficient than using just over-the-road shipping.
What is intermodal transportation?
Intermodal transportation is a combination of two or more freight transportation modes, like rail, trucking, air, or ocean, with the main goal of reducing transportation costs and increasing efficiency. Each mode can be handled by a different carrier, but the shipments are usually moved under a single bill of lading document.
In the ever-changing freight industry, intermodal shipping is growing in popularity, holding a fair share of the general cargo movement. Each year, intermodal containers are moved around 25 million times in North America alone, according to CNBC. Globally, more than 20 million intermodal containers are operated in the freight industry.
Just in the first quarter of 2021, intermodal volumes grew by 10.5%, according to the Intermodal Association of North America. These volumes have been steadily increasing over recent years.
Benefits of intermodal freight transportation
Intermodal freight transport allows shippers to stay flexible and make their logistics more cost-efficient and environmentally friendly. The most common type of intermodal freight transportation includes a combination of truck and rail. In this case, the truck brings speed and flexibility, while rail brings stability and reliability while putting less of a strain on the environment. . Because of its agility, shippers start to integrate intermodal freight transportation into the supply chain strategy more frequently. This allows for the optimization of the transport modes in supply chains while balancing the service and cost aspects of transportation.
Also, intermodal works well for long-distance moves. Because rail and ocean shipments are less expensive than over-the-road transportation, Intermodal freight transportation can increase a company’s bottom line by providing significant savings over standard LTL or FTL shipping. Here are a few identified benefits of intermodal freight shipping:
- Reduced transportation costs. Intermodal combines different shipping modes. Some of them, like rail, can eliminate the overall shipping price. Additionally, it lets you save on fuel. Also shipping intermodal means your freight is moved in containers, which should reduce individual handling and trim manual handling costs.
- Reliability and safety. While trucking is always on a way to the new capacity crunch, rail and ocean containers normally have greater capacity capabilities. Additionally, shipping with rail is more reliable and secure, because there are fewer stops during transit and less handling. In addition, a train is less likely to become subject to road accidents or be stuck in traffic.
- Less harmful for the environment. Being environmentally conscious is now a must in the transportation industry. It’s no secret that trucking is a major contributor to overall air pollution: 28% of all greenhouse gas emissions are produced by heavy-duty trucks. Using rail and ocean as an alternative transportation mode can diminish the company’s carbon footprint.
Eventually, intermodal shipping can offer companies many considerable advantages. However, it won’t be the best solution for every company and lane. You should choose the shipping strategy depending on your freight type, mileage, cargo volume, transit time factors, and internal company goals.
What is container drayage in intermodal transportation?
As intermodal freight is moved in containers, transporting empty or full containers short-distance is considered a separate service called drayage. Container drayage is moving goods over short lengths, largely in the same urban area between ports, facilities, rail yards, or other transportation hubs. Drayage transportation is moved by trucks and is usually part of intermodal transport. The service is in extremely high demand in large port cities, like New York, Baltimore, Los Angeles, Miami, Seattle, and others.
What services does container drayage shipping include?
- Transporting freight from supplier/customer to port
- Moving a container from port to the rail yard
- Moving the container from port to warehouse/shipping hub
- Transfer from facility to the port, rail yard, or another facility
Container drayage plays a critical role in the entire inbound supply chain. Proper equipment and freight tracking options are crucial for effective drayage transportation.
What are the challenges of intermodal freight transportation?
There’s an unspoken truth in the freight industry: it’s much easier to track a pizza than an intermodal container worth $30,000. Due to its complex nature and high dependability on rail and ocean carriers, tracking a container remains a key challenge of intermodal freight transportation. Some carriers have limited technical capabilities and are challenged to share the data needed to track down a shipment, which can create a large blind spot in the transportation process.
The demand for intermodal supply chain visibility has evolved like in any other industry: it’s no longer sufficient for the companies to know only the region or city where their container is. People want to know the exact location of their freight in real-time. Certainly, with intensified digitalization, more carrier-enabled access to information, and overall data exchange, the industry has seen improvements. However, tracking still remains a painful issue, even with API integration, cloud data systems, and smart tracking devices.
The problem is that the discrepancy between expectations and reality is rather significant. Now, shippers don’t just expect the precise location: they want to use data to anticipate the time and place of arrival to plan the next leg of transportation accordingly. At the same time, many carriers are still struggling with digital supply chains and are challenged to provide even the basic location tracking.
Another challenge here in intermodal is a combination of scheduled (rail, ocean) and independent (truck) transportation. In scheduled modes of shipping, the shipper has little control over the loading and unloading process, and therefore less supply chain visibility. In rail and ocean, it’s up to the carrier when the container will leave the dock, and any changes in the schedule are rarely reported to the shipper.
Best solutions for monitoring and tracking intermodal freight
To eliminate transportation gaps and track intermodal containers properly, shippers first need not just supply chain visibility solutions, but direct access to carrier data. Information exchange, in turn, can only happen if the two parties are willing and capable to share data. That’s an important thing to keep in mind when seeking a logistics visibility platform. It should provide integration with APIs and EDI (yes, EDI is still widely used in the industry), support common data standards, and interpret this information the right way. Supply chain visibility software improves inbound logistics transparency, and intermodal freight tracking as well.
Over the last few years, many organizations like Digital Container Shipping Association and the International Maritime Organization have been working on establishing better data quality and standards across the industry. Thanks to these efforts, carriers, and organizations like Union Pacific are creating platforms where shippers can securely access the necessary information about their shipments.
While intermodal visibility is slowly improving, there is still a lot of work to do before reaching end-to-end visibility. The best option for shippers to improve their container tracking is to use global supply chain visibility software with strong integration capabilities. Supply chain solutions like Agistix let users capture every shipment regardless of where and how it was booked. It also integrates with carrier systems through both APIs and EDI to display all the collected data at a centralized dashboard.
With more access to quality carrier data, supply chain executives can finally gain clarity over container shipments whether they’re in a train, on a barge, or on a truck. Only with this level of data centralization is it possible to reach visibility and make data-driven decisions by predicting the transportation process.
Intermodal tracking with Agistix
Agistix can help you overcome intermodal tracking challenges with our end-to-end visibility software. We support different types of integration that require no change to your regular business flow. Once implemented, you will see results in as soon as 4 weeks:
- Reduced inbound supply chain costs by 25%
- Automated operations
- End-to-end visibility into any transaction and shipment
- Streamlined communication
- A platform for proactive risk management
Learn more about our visibility software solution!