Railroad operators are pressing for advantage over their main competitor, long-haul trucking, which has struggled with rising fuel prices, driver shortages and highway congestion. Railroads say a load can be moved by rail using about a third as much fuel as it takes to haul it by truck. And rail transport is becoming more efficient still, they say, as operators speed their lines and logistics companies build huge warehouse areas along routes.
Demand for rail service increased sharply when the U.S. economy and Asian imports surged starting in 2003. Tight capacity on major routes enabled railroads to raise prices. The growth in freight volume has slowed along with economic growth, but shippers say they’re still planning to increase their use of rail transport because of the cost.
“The railroad industry is finally making some money,” says Charles “Wick” Moorman IV, chief executive officer of Norfolk Southern Corp., based in Norfolk, Va. “And we’re pumping that money into our infrastructure.”
Containers are, as so often these days, at the heart of the story.