The year is setting up to be chaotic for the intermodal freight shipping market. After 2025 got off to a great start, despite weather conditions and tariff uncertainties, the winds of change have begun to stir.
Heavy tariffs on the US, changing demand, and an overall revision of supply chains are the challenges to intermodal volumes, especially on West Coast routes. With the year going on, May and June seem crucial for catching up on long-term freight market trends.
Inventory glut and volume uncertainty
With importers expecting tariff hikes, cargo was booked earlier in the year. This inventory, before the tariffs, has already flooded the market, and there is now uncertainty concerning the actual requirements for further accumulation to satisfy ongoing demand.
Many companies are postponing or canceling new orders from China due to the unpredictability of tariffs. Thus, the container volumes entering key gateways, such as Los Angeles, are sharply dropping, which threatens a softening in outbound intermodal shipping.
West Coast under watch
Adapting for savings
Despite the headwinds, some importers would rather use this period to optimize costs. Intermodal shipping, which is typically less expensive than full truckload shipping, has gained increased importance as slower and less expensive shipments accumulate in inventory. Being willing to accept longer transit times grants more flexibility and reduces transport costs.
Carrier diversification and capacity management
Rail freight rates vs. truckload
Rail freight rates are competitive. Spot truckload rates have increased due to seasonal produce demand, and railroads have responded by keeping spot rates at a low level. The usual cost difference has thus widened, providing shippers with a greater incentive to use intermodal services.
Intermodal rates are still considered one of the best in the freight market, although inflation and new labor agreements have created some increases on a longer-term level.
Intermodal service holding steady
So, the conclusion?
The coming months will bring transformations to the intermodal freight shipping trade. From changing inventory strategies to freight market trends, importers and logistics companies evolve constantly. Intermodal offers the best cost value, with competitive rail freight rates and a consistent service level, albeit with some shifting. However, one must be prepared to weather the volatility and plan for sudden rebounds.
