Four in 10 shippers spend more than half their shipping budget on truck transport. Rail and intermodal have been moving aggressively in recent years to cut into this commanding share and have had some success, particularly when truck transport prices were on the rise.
More than half of shippers using trucking services in Canada feel that rail would be a viable alternative for at least a portion of their shipments, according to our annual research. About a fifth indicate that this would apply to more than 10% of their current trucking shipments.
It’s well known that trucking rates were hammered down during 2009. Motor carriers naturally hope for a strong rebound in 2010 and beyond as the economy recovers and trucking sheds its current excess capacity. However, our research also shows there is a ceiling to how much trucking rates can rise. Increasing truck rates were the main reason given for switching to rail, cited by 28% of shippers who had moved away from trucking.
But in 2008, when rates were still climbing and fuel surcharges were having a greater impact on pricing, increased pricing was given as the main reason for moving away from trucking by almost 50% of respondents.
For more Canadian sourced data on modal preferences, rates, surcharges, shipment volumes, capacity and contracts see our annual Transportation Buying Trends report available for $99 through www.trucknews.com
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