Carl Bentzel (FMC Commissioner) testified on April 26th before the US Surface Transportation Board (STB) at STB’s hearing on “Urgent Issues in Freight Rail Service”. Here is an excerpt from his testimony:
“Unfortunately, the railroads have not been able to keep pace or take advantage of maritime growth. Case in point, last year railroads saw a reduction of 16.8% of intermodal rail service, this is at a time when international container volumes surged to a 21% growth. This is stunning. Think how much revenue was left on the table. Think how much could have been made if they had even broken even, let alone increased market share. But even more to the issue, think of how much smoother and more efficient the supply chain could have run this past year if maritime surges had been matched by rail efficiency,” said Commissioner Bentzel. (From FMC’s website)
Commissioner Bentzel went on to say: “I believe that U.S. intermodal railroad service will be critical in the coming decade as we struggle with increased trade and congested entry points. Intermodal rail service provides a way to bypass crowded ports and facilitate the next leg of a container’s journey. Recently, railroads have prioritized cost savings, as opposed to revenue generation, to maximize intermodal market growth. All efforts should be made to work with and push the railroad industry to increase market share of intermodal cargo in the United States. This will facilitate greater integration at U.S. ports, and more advantageously position trucking to be more efficient in moving cargo from ports and railroad terminals.”
We could not agree more with his statements. We have periodically looked at the poor performance of the intermodal traffic sector of the North American system, as reported by the Association of American Railroads.