In today’s hyper-globalized world, the ease at which goods are moved from A to B in many ways defines how we live and work.
If you were to take a straw poll of your household or office, the chances of somebody not wearing, carrying or using an item made from components that were produced or assembled hundreds if not thousands of miles away is almost zero. The ease at which we can acquire everything, from food and clothing to tech gadgets and furniture is, largely, taken for granted.
However, without the non-stop functioning of transportation networks at the local, national and international level, none of this would be possible. And the way in which these networks operate continues to evolve in sophistication, both in terms of routing efficiency, technology leveraged and coordination between players on land, at sea and in the air.
Indeed, the latter refers to the concept of intermodal transportation.
In the simplest of terms, intermodal transportation is the use of two or more modes, or carriers, to transport goods from shipper to consignee, without any handling of the freight itself when changing modes.
A TEU container, for example, could conceivably leave a Chinese factory on a haulage truck to a nearby rail depot, travel by freight train to the nearest seaport, be ferried by container vessel to the U.S. coast, transferred onto a railway line and moved to another depot, before being unloaded onto a truck and driven to its final destination–all without a single hand touching the goods inside.
Despite the disruption caused by the coronavirus pandemic, the value of such activity is estimated to have hit $25 billion in 2020. As the world’s economy starts to recover, the global intermodal freight transportation industry is forecast to grow at around 15 percent year-on-year between now and 2027, when it is set to be worth $67 billion.
North America holds a significant share of the global market. The U.S. alone is expected to register at around $6.8 billion for 2020, a figure which should steadily rise given how increasingly dependent intermodal transport activity is on the consumer economy’s demand.
The region’s rail industry is concentrating on creating new intermodal services that can successfully rival over the road options.
For instance, in August 2019, Canadian National Railway (CN) and CSX Transportation announced a new intermodal service offering between CN’s greater Montreal and Southern Ontario areas, and the CSX-served ports of New York, New Jersey, Philadelphia and the New York City metropolitan area.
This intermodal offering is expected to convert long-haul trucks to interline various rail services. Trains will be able to run directly into the center of Toronto and Montreal’s urban markets via CN intermodal yards, making this partnership a natural opportunity for both railroads.
Meanwhile, there are signs that intermodal activity in the U.S. is bouncing back from the initial COVID-19 slump.
According to the Association of American Railroads, during the first week of August 2020, 277,054 intermodal shipments were made by U.S. railways, the highest level seen since December 2019 and 30 percent up on the 2020 low in April.
Around the States: 5 key Intermodal Transit Hubs
The signs are indeed healthy, and many cities and regions across the U.S. are ready to help the country bounce back by increasing throughput of goods once more.
Critical intermodal transport conduits exist all over the States, from east to west and north to south–without them, supply chains would be far costlier and more difficult to operate seamlessly. Here, we take a look at just five key nodes which provide leading intermodal infrastructure, starting in the Midwest.
For well over a century, Chicago has acted as a key artery in America’s commercial transport network. Around a quarter of all rail freight calls into the city, either as a final destination or stop on a journey elsewhere, while O’Hare International Airport processes around 2 million metric tons of cargo at a value of approximately $200 billion every year.
Illinois is also extremely well served by what is North America’s largest inland port in the form of CentrePoint Intermodal Center. Located in the Joliet and Elwood area, around 40 miles southwest of Chicago, it is a 6,400-acre master-planned intermodal development that sees 3 million TEUs pass through it every year.
It includes a 785-acre Union Pacific Railroad complex just south of Joliet and a 770-acre BNSF railway complex farther to the southwest. Furthermore, it is built with heavyweight roads able to withstand massive pressure and contains a number of other useful features such as water and utility systems, public bus service connections, no restrictions on trailer parking ratios and 24/7 on-site fire and police protection.
The site constitutes something of an intermodal fortress, and it is currently home to more than 30 tenant companies who between them occupy more than 14 million square feet of space.
Dallas strategically sits at a crossroads of numerous railroad lines, four major interstate roads and one of the world’s busiest airports, making it among the country’s most important intermodal transport hubs.
The Dallas-Fort Worth Metroplex is a 9,000-square-mile urban center located near the geographic heart of the United States and equally accessible to the East and West coasts. Its location means that around 80 markets can be reached overnight either by road or rail, with major regional business heartlands such as New York, Los Angeles, Toronto and Mexico City all within easy reach, an advantage that few other intermodal nodes can offer.
Dallas-Fort Worth International Airport considers itself “the nexus of Latin America-Asia transit freight,” and for good reason. In 2019, it saw almost 985,000 tons of international and domestic cargo move through its site and, despite the impact of COVID-19, still recorded more than 870,000 tons of goods in 2020, a drop of around 11.5 percent.
Another important facility is the Wylie Intermodal Terminal. A fairly recent addition to Dallas’ intermodal transport infrastructure (opening in 2015), it is a $64 million development owned by Kansas City Southern Railway (KCS), and it is set to capitalize on significant opportunities in cross-border activity with Mexico.
Wylie is a city and northeastern suburb of Dallas, with the KCS terminal spanning 500 acres and servicing 12 gulf ports and one Pacific Ocean port, as well as more than 140 transload centers and 11 intermodal ramps. KCS also provides 181 interchange points with other railroads, including all U.S. and Mexico class 1 railroads.
Norfolk, Virginia, is home to a vibrant intermodal transport scene thanks to its ability to serve rail, sea and air freight seamlessly. It is built on a formidable maritime history, centered around the enormous naval base on the Chesapeake Bay, a tradition that has very much expanded into the sea freight domain.
The Port of Virginia, which is situated around two and half hours from the open sea, handled 2,327 vessel calls and departures in 2019, equating to around 3 million TEUs and 55 million tons of cargo worth almost $75 billion. Thanks to the port’s two on-dock class 1 railroads, more than a third of the cargo managed here arrives or departs by rail–this is a higher proportion than any port on the East Coast.
Logistics firms using Norfolk can also rely on its international airport. It is one of the most efficient cargo operations in Virginia and moves around 30,000 tons of air cargo every year, with the likes of FedEx, Mountain Air and UPS all regular customers.
Around 2,700 miles due west of Norfolk, you will find Los Angeles, arguably the West Coast’s most important intermodal transport hub.
Its beating heart is undoubtedly the Port of Los Angeles, a massive seaport covering 7,500 acres of land and water along 43 miles of waterfront that brands itself as America’s Port. Indeed, it is the nation’s No. 1 container port and prides itself on providing a global model for sustainability, security and social responsibility.
Founded in 1907 as a far smaller operation, today it holds 82 ship-to-shore container cranes spread across 15 marinas with 3,376 recreational vessel slips and dry docks, facilities that enabled it to move 9.2 million TEUs in 2020.
It adjoins the Port of Long Beach, itself one of the busiest seaports in the world. The operation here houses 68 gantry cranes, which between them move around 7.5 million TEUs every year, all valued at close to $200 billion.
This is not to forget the contribution of Los Angeles International Airport, the world’s fourth busiest, which handled almost 2.5 million tons of cargo in 2018, FedEx alone is responsible for carrying 16 percent of the freight that moves in and out of the site.
It is also important to consider the significance of intermodal transport infrastructure away from the coast. Memphis, unlike our other four locations, is situated in a landlocked state (Tennessee) and is home to one of the country’s most active intermodal freight systems.
Its focal point is Memphis International Airport which, thanks to its heavy use by FedEx, is the top U.S. gateway in terms of cargo weight and the second busiest cargo airport in the world.
FedEx employs more than 11,000 staff at its Memphis hub and has more than 34 million square feet of space under lease on airport property. The company operates around 400 flights daily and handles over 180,000 packages and 245,000 documents per hour.
In striking distance of Memphis International Airport is America’s fifth-largest inland port–the Port of Memphis. It serves more than 150 industries and moves a rich variety of goods, from petroleum and cement to grain and steel, and can connect to sea, rail, road and air via the Mississippi River, five class 1 railroads, major north-south and east-west interstate highways, and the nearby airport.
Such is its vital role in facilitating economic activity, it claims to carry an annual economic impact of more than $9.2 billion. Indeed, it refers to itself as “the Mid-South’s best kept industrial and economic secret,” even though it has been operational since the 1950s.
Exploiting the Intermodal Advantages
These are just five examples of cities and regions enabling supply chain and logistics firms to exploit the numerous advantages offered by intermodal transit hubs.
Economically, they help to minimize truck movements, which reduces fuel consumption, driver costs and the need to invest in road-based vehicles. Lower fuel consumption also results in fewer carbon dioxide and nitrogen oxide emissions, vital if the country is to drive future development along a sustainable path.
From an operational perspective, businesses can benefit from more reliable transit times (due to reduced road reliance), elimination of border documentation and hold-ups, reduced impacts from adverse weather and fewer accidents and damage to cargo. Meanwhile, hauliers can benefit from working within their own country and avoid making long trips across borders.
Intermodal transportation is, above all else, designed to create an even more fluid supply chain from which all commercial enterprises and consumers can benefit. By taking advantage of the numerous modes of transport via critical junctures and hubs along long-distance routes, freight need not rely on a single truck to make it from destination A to destination B.
Rather, intermodal relies on input from a variety of stakeholders along the way, spreading the wealth generated by commercial and consumer-based purchases more widely than it otherwise would. Hubs such as those seen in Chicago, Dallas, Norfolk, Los Angeles, Memphis, and many others not cited, help to realize this.
And as the country recovers from the enormous health, social and financial impacts of the coronavirus pandemic, intermodal transport will no doubt play its part in remobilizing the U.S. economy for the betterment of all American businesses.