Intermodal activity dropping

Dropping fuel prices and overcapacity in the trucking market made it difficult for intermodal to continue growing, FTR Associates said.

Intermodal transportation lost market share against trucks in the fourth quarter of 2008 as dropping fuel prices and overcapacity in the trucking market made it difficult for intermodal to continue growing, FTR Associates said.

According to FTR, intermodal’s share of U.S. long-haul movements of international and domestic containerized freight fell 0.2% in the fourth quarter, and domestic intermodal dropped after seeing its share increase for the past year.

"Intermodal is facing some terrific headwinds at the moment," said Lawrence Gross, senior consultant for FTR. "The combined effects of plunging fuel prices and excess capacity in the motor carrier industry proved too great for domestic intermodal to overcome in the fourth quarter. Compounding the problem is the profound weakness in international trade, a market dominated by long-haul intermodal."

However, Gross noted that future projections for intermodal are not as bleak. "As truckers continue to shrink their fleets in response to the current weak freight environment, when the economy eventually does begin to recover there will be a significant shortage of truck capacity and intermodal will then be well positioned to benefit," he said.

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