The once red-hot intermodal market shows signs of cooling, with the latest data from the Intermodal Association of North America (IANA) revealing a 3.2% year-over-year decline in July volumes to 1,485,325 units. This unexpected downturn during peak shipping season raises questions about whether this represents seasonal adjustment or deeper market shifts.
Mixed Performance Across Segments
The July report reveals divergent trends across transportation modes:
- Trailers: Suffered the steepest decline at 29.0% year-over-year to just 70,445 units, suggesting reduced demand for this transport method.
- Domestic Containers: The sole bright spot with 1.6% growth to 661,775 units, indicating resilience in domestic shipping.
- All Domestic Equipment: Combined figures show a 2.4% decrease to 732,220 units.
- ISO Containers: International containers fell 3.8% to 753,105 units, reflecting global trade challenges.
Year-to-Date Figures Paint Grimmer Picture
The cumulative data through July shows more pronounced declines:
- Total intermodal volume down 5.1% to 10,428,630 units
- Trailers plummeting 20.4% to 570,241 units
- Domestic containers growing 5.1% to 4,806,591 units
- ISO containers declining 10.8% to 5,051,768 units
Industry Analysis: Challenges and Silver Linings
IANA President and CEO Joni Casey noted that while international container volumes had plateaued in late 2021 - theoretically creating favorable year-over-year comparisons - multiple headwinds persist:
"Port congestion, China's COVID restrictions, and chassis shortages continue to impact international container movement," Casey explained. However, she observed that international containers still outperformed domestic units in absolute volume this quarter, reverting to historical patterns.
Peak Season Outlook: Muted Expectations
Casey anticipates a more subdued peak season compared to previous years: "While the traditional shipping peak hasn't disappeared, it has flattened significantly. We expect steadier shipping patterns rather than dramatic spikes."
Potential holiday season growth remains contingent on resolving supply chain bottlenecks and pandemic-related disruptions.
Economic Factors Create Complex Impacts
The current economic environment presents both challenges and opportunities for intermodal transport:
- Inflation: May reduce consumer purchasing power while potentially making intermodal more attractive for cost-conscious shippers.
- Diesel Prices: High fuel costs could enhance intermodal's competitiveness against long-haul trucking.
Intermodal's Value Proposition
The multimodal approach offers distinct advantages:
- Cost efficiency for long-distance hauls
- Lower carbon footprint than pure trucking
- Congestion relief for highway systems
However, drawbacks include longer transit times, operational complexity, and infrastructure limitations.
Future Prospects
The sector faces significant challenges from global economic uncertainty and supply chain fragility, but also opportunities from:
- Growing emphasis on sustainable logistics
- Technology adoption improving efficiency
- Potential policy support for multimodal solutions
The July data underscores the intermodal market's current volatility, with domestic containers demonstrating relative strength amid broader declines. Industry participants must navigate this complex landscape through operational flexibility and innovation.