What's it take for a shipper to change his modal selections? In a business atmosphere where shippers are becoming less and less attached to moving their goods by a specific mode, this is a critical qu...
What’s it take for a shipper to change his modal selections? In a business atmosphere where shippers are becoming less and less attached to moving their goods by a specific mode, this is a critical question. Our Transportation Media Research division has spent the last few years trying to get an insightful answer and this is what the research shows us.
The first thing we know is that from 2005 to 2008, rising rates and surcharges were causing an increasing number of shippers to change the mode they used for at least a portion of their shipments. Back in 2005 about one-third of shippers were telling us that higher rates and surcharges were impacting their modal selections. By 2008, that figure had changed to 50% of shippers. But trucking rates took a nosedive across all modes in 2009 and in trucking in particular. The cost of ground transportation for Canadian shippers declined again in October, the www.cgfi.ca
Canadian General Freight Index indicates. Since the beginning of the year, the index has fallen in eight of the ten months, and has declined 9.6% in aggregate. And many carriers have not been able to hold the line on surcharges either.
The end result: Only 40% of shippers answering our survey at the end of 2009 indicated that rates and surcharges were causing them to switch modes. But that figure is likely to climb higher yet again as the recovery takes hold and rates start to rise.
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