Surface Transportation
Spot intermodal savings exceeded the long-term average for the third straight quarter in Q4 . Ian Dewar Photography / Shutterstock . com
Contract truckload rates rose 3 cents to $ 1.98 per mile quarter over quarter , while contract intermodal rates fell 1 cent to $ 1.46 per mile .
The ISIs measure how much money a shipper should save on 120 modally competitive US lanes . There are two indexes , one for the spot market and one for the contract market . Index values are measured from a neutral base of 100 . Values greater than 100 indicate domestic intermodal is cheaper , while values less than 100 indicate trucking is cheaper . The higher the value , the more money intermodal saves an average shipper .
All index values correspond to percentages , which means a value of 126.5 signifies an average US shipper saved 26.5 % on a domestic intermodal contract versus a truckload contract . And 121.0 signifies a 21 % savings comparing the spot intermodal and truckload markets .
In dollar figures , intermodal shippers in the fourth quarter saved an average of $ 741 per container on spot transactions , up from $ 649 per container one year prior , across the 120 indexed lanes . Shippers saved $ 838 per container on contract business compared with trucking , up from $ 814 per container in the fourth quarter of 2023 .
The index assumes distribution centers are located less than 20 to 30 minutes away from the rail terminal at origin and destination . If the distribution center is an hour or more away , it could significantly reduce the savings calculated in the index or make long-haul trucking cheaper .
Longer lengths of haul save the most money . On lanes longer than 2,000 miles , an average intermodal contract saved $ 1,457 per container . On lanes less than 800 miles , though , contracts saved only $ 150 per container , which can vanish based on detention or demurrage fees or a regional dray trip over one hour .
Bid season cloudiness
The first wave of 2025 intermodal contracts , which become active between January and mid-February , was “ disappointing ” for asset-based and non-asset intermodal marketing companies ( IMCs ), according to source conversations with the Journal of Commerce .
Shippers accepted rate increases on California outbound freight , but on the lower end of what IMCs sought , while rates were flat or down outside the West Coast .
J . B . Hunt Transport Services said it has pivoted to pricing discussions on the second wave of bids , which typically go into effect between late March and the end of May .
If truckload contract rates go up by mid-single digit percentages , then intermodal shippers might pay more in the second wave of bids . To date , trucking contracts for 2025 have been flat to slightly up year over year , according to conversations with truckload shippers .
“ As truckload rates begin to improve , typically you ’ ll see intermodal rates begin to follow .”
“ We ’ re expecting the [ truckload ] bid season to be favorable from a contractual rate standpoint and we ’ d expect some of those rate increases to begin to be implemented in [ the second quarter ],” Adam Miller , CEO of Knight-Swift Transportation , the largest for-hire one-way truckload carrier in the US , said during a Jan . 22 earnings call . “ As the truckload market rates begin to improve , typically you ’ ll see intermodal rates begin to follow , and we ’ re already starting to see that .”
If accurate , J . B . Hunt , Schneider and other IMCs might be more successful in raising rates on shippers in the second quarter than in January bids .
However , there is still an imbalance between the supply of containers and demand .
Schneider said 10 % of its fleet — about 2,600 containers — is stacked . If that figure is representative of the wider domestic intermodal market , roughly 30,000 to 40,000 containers remain idle across the US .
The data behind the Contract and Spot ISIs is available to Journal of Commerce Gold subscribers .
email : ari . ashe @ spglobal . com
62 Journal of Commerce | March 3 , 2025 www . joc . com