Class I Railroads in North America Seek to Enhance Service Quality to Counter Trucking Competition
💪🏼 Class I Railroads in North America Seek to Enhance Service Quality to Counter Trucking Competition.
Leaders of Class I freight railroads in North America have emphasized the importance of improving service quality to compete with the trucking industry and address the decline in intermodal market share. During the COVID-19 pandemic, service disruptions led to freight backlogs, prompting concerns from shippers and government leaders. In response, railroads are focusing on delivering reliable, resilient, and long-term service. However, intermodal's domestic market share has fallen from 6.7% in 2016 to 5.5% in the second quarter of 2023, resulting in a $4 billion annual revenue loss, according to transportation analyst Larry Gross. To regain market share, intermodal must offer reliable, competitive, and cost-effective services compared to trucking. Railroads have invested in improving operations, train speeds, and on-time performance, but some shippers remain skeptical, given the competitive challenges posed by the trucking industry's capacity tightening over the past year.
Union Pacific (UP) is set to resume its efforts to implement one-person train crews by conducting a pilot program in Nebraska and Colorado.