Intermodal Market Trends & Statistics - 4th Quarter 2014 - 8


Intermodal Market Trends & Statistics
the 12 months ending in December
2014, and so forth). Trends remain
fairly steady for all three data sets.
The first chart looks at volume by
equipment type. It is indexed to the
first quarter of the period. Domestic
Containers have lead growth since the
recovery started in 2009 and are now
almost 2.5 times larger than at the
start of this analysis. International containers, though still the largest sector,
have been growing more slowly, yet
are creeping back toward their prerecession peak. Trailers, though they
have seen significant volatility on a
monthly basis, have been effectively
flat since the recovery began.
The second chart shows volume
for key lane groupings: Transcon
Eastbound, Transcon Westbound,
North-South and East-West. It is also
indexed to the first quarter in the
period. The transcon lanes are defined by movement between coastal
regions (the Northeast, Southeast
and Eastern Canada on the east coast
and the Northwest, Southwest and
Western Canada on the west coast).
The North-South and East-West lanes
encompass freight in both directions,
excluding the transcon lanes. NorthSouth volume continues to move
closer to East-West, having grown
far more quickly since the recession.
Transcon volume also is growing,
though far more slowly than the other
two sectors.
Finally, the third chart highlights
length of haul as estimated from the
IANA Market Trends and Statistics
data using key points in each region
(e.g. Los Angeles in the Southwest,
Atlanta in the Southeast). Both segments have been moving down over
the past eight years as railroads

expand service in shorter-haul lanes.
Further downward pressure comes
from domestic's growing share and
is just over 123 miles shorter, on
average, than international since the
recovery started.

Intermodal Outlook
Q4 intermodal growth was the
slowest since Q1. For some, that
could raise caution about 2015 expectations. But the many distortions to
2014 - especially the harsh winter's
impact on Q1 and port labor issues
that skewed international growth patterns - make each quarter's results
somewhat misleading. A better bet is
to look at full year performance, with
the intermodal market delivering a
very healthy 4.8% boost above 2013
levels. Even with many network challenges in 2014, growth accelerated
compared to 2013.
Another factor in late 2014 was
trailer growth coming to a halt, in
part based on tougher year-over-year
comparisons. After climbing just shy
of 6% in the first half, highly volatile
trailer volume was flat in the second
half. Looking only at containers, the
vast majority of intermodal volume,
growth was just a bit slower in the
second half than in the first. And for
domestic containers, second half
gains were actually a touch faster than
first half, up 6.0% compared to 5.4%.
These results, together with expectations for improved service entering
2014, position intermodal for another
solid year.
As is true for the broader economy,
plunging oil prices are a key factor
for intermodal. Certainly they will

Railroad Fourth Quarter Earnings Per Share

CN1

4th Quarter
2013
2014
$0.76
$1.03

Year to Date
2013
2014
$3.09
$3.85

Canadian Pacific1

$0.47

$2.63

$4.96

$8.46

CSX

$0.42

$0.49

$1.83

$1.92

Norfolk Southern

$1.64

$1.64

$6.04

$6.39

Union Pacific

$1.27

$1.61

$4.71

$5.75

1

Results reported in Canadian dollars

Fourth Quarter/Year-End 2014  © IANA 2015

boost consumer spending as households spend less to fuel their cars.
Together with a soaring U.S. dollar,
that likely will mean more imports.
2015 international growth could very
well exceed 2014's solid 4.4% gain,
assuming West Coast labor issues are
settled during the normally slow first
quarter. If that issue drags on, import
shipping patterns could once again be
distorted, and rail intermodal volume
pushed lower if more containers are
shipped to East Coast ports.
And while many speculate that
lower fuel prices will move domestic
share back to the highway, regulatory
constraints on trucking capacity aren't
solved by cheaper diesel. If service
continues to improve, railroads'
domestic share gains look likely to
continue. The pace of big box growth
may slow as that market grows more
mature, but it is still likely to lead the
intermodal market. Assuming the U.S.
economic recovery continues, 2015
growth in the 4%-5% range appears
very likely.
In other developments:
 The American Railway Car Institute
reported delivery of 4,182 new
double-stack well car units for the
North American intermodal market in 2014. This new equipment
should give railroads capacity to
handle nearly one-half million additional intermodal loads.
 CSX opened a new intermodal
terminal in Salaberry-de-Valleyfield
near Montreal. The $100 million,
89-acre terminal will offer Canadian
shippers additional alternatives for
both domestic and international
service.
 Norfolk Southern has increased
frequency of intermodal service
to the inland port of Greer, South
Carolina. Enhanced service on the
200 mile NS line between Greer
and the port of Charleston increases opportunities for intermodal
shippers in that area.
 Work started on a rail link between
the former Army base at the Port of
Oakland and Union Pacific's main
line. Plans are to develop a logistics facility of two million square
feet to support transloading and
logistics activities.
8

Table of Contents for the Digital Edition of Intermodal Market Trends & Statistics - 4th Quarter 2014

2014 Intermodal Recap
4Q 2014 Rail Volume
Key Corridor Results
Regional Traffic
Seasonally Adjusted Intermodal Volume
4Q 2014 IMC Results
Intermodal Long-Term Trends
Intermodal Outlook
Trucking Industry Outlook
U.S. and Canadian Domestic Economies
Monthly Traffic by Type
Monthly Traffic by Ownership
Eastern Canada
Mountain Central
Midwest
Northeast
Northwest
South Central
Southeast
Southwest
Western Canada
Major Intermodal Corridors
Notes to Report

Intermodal Market Trends & Statistics - 4th Quarter 2014