The drayage sector has faced significant challenges in recent years, with low volumes and tight margins putting pressure on operators. However, as demand rises and freight volumes rebound, optimism is growing about the market's recovery. Over three days of activities at IANA Intermodal EXPO in Long Beach, CA, our team members interacted with customers, stakeholders, and industry experts. Read on for our highlights and reflections from this essential drayage industry conference.
Drayage market health check
The Intermodal EXPO kicked off with an expert panel on the current state of drayage, something on many attendee’s minds after several years of low volumes, high capacity, and tight margins. During the discussion, the panel touched on the latest demand levels, equipment statuses, and operational challenges, while exploring how to drive the continuing conversation on data analysis, technology integration, and stakeholder collaboration for the benefit of the drayage community in specific and the intermodal market as a whole.
CargoWise Landside’s Head of Revenue, Dennis Lane, attended the session and came away with a sense of optimism on the general health of the container drayage market.
“Coming out of what some have called a ‘drayage recession,’ the sector has seen some contraction resulting in a drop in capacity. Meanwhile, July, August, and September saw demand increase and freight volumes rise, indicating a potential return to a normal peak season.” The belief is that with decreased supply and increased demand, freight spot quotes will rise, strengthen move margins, and improve drayage operators’ bottom lines.
Nearshoring is an increasingly popular supply chain strategy
Chris Fox, Business Development Executive for CargoWise Landside’s on-demand truck, trailer and container storage marketplace, SecurSpace, attended the panel discussion “Navigating Nearshoring: Intermodal Perspectives on Supply Chain Realignment,” which examined the impact of nearshoring on intermodal operations.
Nearshoring continues to cause shifts in shipping routes and modal preferences, changes in port utilization, and adjustments to distribution patterns as shippers build resiliency into their supply chains to reduce lead times and mitigate risks. According to Fox, one of the key takeaways from the session was that “of the current freight volume coming across land border gateways, more than 2/3rd is going truckload vs. intermodal, with rail companies making large investments in infrastructure to balance this out in the near future. Meanwhile, the trade imbalance between northbound and southbound freight sits at around a 4.5 to 1.”
He notes that “despite this imbalance, assets are not staying across the border very long as motor carriers on both sides want their containers and chassis returned home as quickly as possible.” This means a high number of empty container return trips and increased need for short-term storage on the US side of the border.
For a deeper dive into nearshoring and its impact to the supply chain, read our recent article, “More than a buzzword: nearshoring in North America.”
Technology continues to drive rail adoption
The Intermodal EXPO highlighted several technology trends in the rail industry. These include the growing importance of artificial intelligence (AI), optical character recognition (OCR), and digital process automation to optimize transportation management, along with seamless integration to external solutions to enhance and complement shipment execution.
According to Austin Ung, Business Development Executive for CargoWise Landside containers by rail, Blume Global, “rail tends to be a lower priority in terms of marketed services within a logistics service provider’s portfolio. As a result, any offering must be both innovative and cost-effective.” Ung believes by implementing the latest industry trends – AI, OCR, and process automation – in an economical way, the barrier to entry for rail and intermodal marketing companies (IMC) can be lowered, making them more attractive and accessible.
Supply chain security, resiliency, sustainability, and collaboration continue to be mission critical
“Theft was a huge discussion point that came up in almost every meeting and discussion we had,” recalls Marisa Martin, AVP with CargoWise Landside containers by rail, Blume Global. Freight security is top of mind and new internet of things (IoT) technology is emerging that can reduce freight theft.
Other critical challenges and innovations for the intermodal industry include:
- The ongoing evolution towards greater supply chain resiliency in response to global disruptions, ensuring that companies can adapt to unpredictable geopolitical and market shifts.
- A strong emphasis on reducing emissions and improving energy efficiency, especially at major trade hubs like the Port of Long Beach.
As Martin points out, “initiatives like the use of shore power for docked ships and technical advancements that integrate automation, data analytics, and IoT are providing the practices and tools for more sustainable, flexible, and optimized intermodal operations.” These, compounded with the growing focus on collaboration across the various segments and stakeholders of the supply chain, are working together to ensure that the different modes of transportation work seamlessly to enhance both operational efficiency and environmental responsibility.
CargoWise Landside at the IANA Intermodal EXPO 2024
It was a pleasure catching up with customers, partners, and industry peers to discuss how CargoWise Landside is addressing the complex challenges faced by port and landside logistics communities, while improving container movement efficiency between terminals, owners, and exporters.
If you missed us at our Long Beach office open house, networking event at Bo-Beau restaurant, or exhibit hall booth, watch our video wrap-up for more insights and event highlights!