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Rick LaGore

By: Rick LaGore on August 26th, 2021

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Truckload | Intermodal Transportation

August 27, 2021

The purpose of this weekly update is to provide shippers with the latest intermodal shipping news that is impacting freight capacity and service across both the US truckload and intermodal markets.


Union Pacific

union pacificKey Equipment Updates: 

  • LA: Less interchange than expected from both NS and CSX coupled with fewer empty repo opportunities into LA led to a more challenging equipment situation this week than forecasted. For this coming week, we expect improved empty repos and more interchange from NS over Chicago. Empty supply is expected to see ~5% improvement next week. 
  • STIR & Laredo: Capacity constraints expected to continue. 
  • Mexico: Expect equipment availability to be even more challenged than the current week. If additional EMP interchange over Memphis from NS, we will try to send more equipment south.  
  • Dallas: Granting off ramp remains closed in Dallas. Chassis supply remains extremely tight in this metro. 
  • Marion: Better capacity relative to other metros but will remain tight. 

Macro Network Update: 

From a UP network perspective, they are very focused on improving the velocity as it is the critical path forward to generating more capacity. 

Velocity translates into improved capacity: 1 mph improvement = 100 more locomotives; 120 more crews; 5.3K fewer cars of congestion … all of which equates to fewer loads left behind.

While they recognize there is a lot of work to do on this front, they are beginning to see some positive service indicators including: increased car velocity, improved terminal processing time, and fewer trains held across the network. 

The service recovery work is ongoing, and they anticipate it will take about another month to fully recover from the various wildfire, bridge and other washout-related outages that significantly impacted their network earlier this summer.  

The best way shippers can help generate capacity is to continue to work with your customers to drive down street dwell times. Street dwell times remain elevated about 20% YOY. 

NS Updates

norfolk southernCurrently, the lane closures include all inbound and outbound Kansas City and Chicago-Bethlehem.  

Most of the previously metered lanes are open, but with request by NS to stay close to previously metered limits.   You will see a lot more challenges for different reasons, no equipment, lack of drivers, ramp congestion starting to build up and more.

CSX Updates

CSXCSX Transportation has restricted the number of domestic containers it will accept in Chicago for the second time in as many months, as the eastern US railroad struggles with heightened demand amid a disruption to Norfolk Southern Railway’s (NS’s) intermodal network.

Tropical Storm Ida

  • The City of New Orleans is closely monitoring the status of the flood gates.  Closure of the Union Pacific gate is effective at 17:00 EDT. 
    • The gate closures will prevent interchange with eastern rail carriers. Rail interchange with the eastern carriers is subject to change throughout the storm and we will provide additional information as it becomes available.
  • Union Pacific's Avondale, Louisiana, intermodal terminal will temporarily suspend operations today at 17:00 EDT. 
    • The Avondale terminal reopening will be dictated by the extent of the storm and associated flood impact.

Port & Drayage News

LA-LB Terminals Worried About Rail Backlog Ahead of Peak Volumes

BNSF and UP indicate their inability to meet their customers’ demand in Southern California originate from constraints within their network coming from the following:

  • Dray drivers quitting at alarming rates because of rail terminal congestion delays are not being compensated for in the rates they are obtaining from shippers.
  • Dray drivers moving their capacity to over-the-road opportunities because of the record high spot rates.
  • Chassis shortages at interior US rail ramps.

The port congestion and delayed ocean shipments are disrupting surface networks as equipment that was intended to be picked up at the ports are being used elsewhere because carriers are not willing to wait on delayed freight.

Chassis Tire Issues Hitting Gulf Coast and Midwest Drayage

High summer temperatures, combined with peak demand causing bias-ply tires to fail at an alarming rate.  The investment to transition to radial tires is in process, but not quick enough for drivers.

Not only does the issue delay shipments, but because the severity of the issue is an emergency for the drivers they are often required to pay out of pocket for the repair, which does not get reimbursed and by the time the repair occurs the driver can often run out of hours.

Both are another cause for dray capacity to move their capacity to truckload opportunities.

Railroads Look to Ease Inland Congestion through Metering

During the last two months, container lines and railroads have taken a new, multipronged approach to combating crippling congestion, metering trains leaving ports to matching containers inland to available terminal, warehouse, drayage, and chassis capacity.

The hope is to balance out the network demands to better manage congestion and avoid additional ramp shutdowns.

The downside is metering will most likely cause additional bottlenecks at marine terminals where box dwell times continue to rise and cause imbalances in the local markets, as dray drivers will be further discouraged by their port business and move their capacity to truckload options.

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About Rick LaGore

Rick is the co-founder and CEO of InTek Freight & Logistics, a company focused on being the place where companies come when faced with a logistics problem.

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