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US shippers to shift to rail from rising truck rates

Modal lines that hardened as US economic growth slowed dramatically in 2015 and 2016 and truckload rates plummeted appear to be softening. As the economy improves, businesses expect truckload rates to rise, and those companies are looking for alternative routes to savings.

Shippers pursuing freight bids are testing opportunities to control transportation costs by shifting some of their volume to different sectors or modes. Logistics consultants say they see that trend more frequently during bids, as shippers look for savings across tens of thousands of lanes.

“This bid season has been really interesting,” said Ben Cubitt, senior vice president of engineering & strategic carrier management at Transplace. “We see some real trends (in mode selection),” he said, particularly in the interplay between truckload and intermodal.

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February 1, 2017