The intermodal industry is on the verge of coming together for the international Expo based in Long Beach. Majority of the Intermodal members are waiting anxiously for the industry to return to its halcyon days of steadily high growth. According to the forecast done by analysts, next year is expected to be a great year for the industry. The experts report that 2016 was a bad year for the industry as the total intermodal traffic dropped by 2.1 percent. This resulted in International intermodal business reducing by 3.3% including a domestic fall of about 0.7%.
However, according to the FTR, this year has been a good one given that intermodal has increased with 3.7 percent up to now with international increasing up to 4,9 percent whereas domestic has grown with about 2.6 which is perceived as much better as compared to 2016.According to the research group forecasts, there will be a 4.7 percent growth for the entire calendar year and a 5.2 growth in international business.
2018 Intermodal Deceleration
According to Larry Gross who is an acclaimed intermodal expert, in 2018 there will be an insignificant deceleration despite the fact that Gross went ahead to present a promising report during the Intermodal Association of North America conference held in 2017.Gross asserts that the pullback will basically be on the international side since they are not yet convinced that the present burst of activity particularly on the import side will be continuous. More so, Gross forecasted that domestic business will remain to be very robust. Additionally, Gross pointed that the complete ELD effect will not be experienced until 2018 given that they will not implement it in any actual way up until April
The Short Term and Long Term Effects of ELD
According to Gross consideration, there will be a short-term changeover to electronic logging devices (ELD) which will result in a ripple effect for the owner-operators in the coming year. On the other hand, Gross believes that the most of the commercial fleets will adjust in the long term though charges will continue to be above pre-ELD levels since fleets will not be able to compensate entirely for the production loss. Additionally, Gross says that whenever the road charges increases, shippers incline to look to intermodal rail to continue within their carrying budgets.
Enforcement of Strict ELD
Intermodal executive’s depict that coming year will be important to intermodal as it could achieve a market share on 500-1000 mile tows. Moreover, a few of the truckload executives openly condemn the owner-operators who deliberately intrude upon the hours-of-service guidelines, undertaking the long tows in a single day. Confidentially, some also are infuriated at the shippers and dealers who turn a blind eye to the prohibited practices with a motive of lowering costs.
In this connection, the Lee Chair who happens to be the managing partner at Transportation and Logistic Advisor, came to a conclusion that with strict ELD implementation, invoice amounts might rise to 100%, and that intermodal would offer a possibility to alleviate the financial harm.
Intermodal industry outlook
The promising intermodal industry outlook adopts the fact that the financial recovery will spill into the tenth year. According to an economist Walter Kemmsies from Jones Lang LaSalle assertions, statistically the more the time taken to expand, the more likely people will start to see a slump in the subsequent few quarters. Nonetheless, if the economy is looked at structural chances of it happening is very low. He further added that he did not see any prospects in industry, mainly in logistics whereby huge booms were going to be expected. For instance, in e-commerce, there are a number of inland ports that are emerging as well as a great deal of investment in distribution centers, nonetheless, it’s being counterbalanced by the loss of brick-and-mortar selling the square footage.