Companies that transport commodities worldwide are choosing rail shipping for efficiency over trucking in greater numbers these days. One of the main reasons for this is the overall cost of multimodal rail vs truck shipping. Here are some comparison costs if you are seeking a method for reducing costs with your shipping and with any logistics need.
Trucking is a universal solution for shipping. Consumer products can leave the factory and be delivered to a distributor or even to the end customer. Depending on the geography involved and the types of goods being sold, it is generally a favoured option for short trips.
The cost between the two modes can be more than 10 cents for every ton moving a mile. This may not seem like much, but the average company is likely to deal with many tons of shipping and many miles carried for their products every year. When we take a look at bulk shipping from a company in Cleveland for example, we see that the trucking costs for their delivery to TX was around $5,150 per truck load. Rail costs are $6,676 per car. As one rail car equals the same size as 4 truck loads, we can see an immediate cost savings for the company if there is the proper demand for their product or if they are willing to use multimodal or shared shipping.
Choosing to split the costs of a full rail car between several local industries and then using a truck or local transport company for short trips can cut down on costs even further and still offer the same level of customer service to the end customer.
When we compare the costs of rail shipping vs truck shipping, we see that it is not only cheaper to secure shipping for these needs but also much more efficient from a fuel cost perspective as well. With cost savings, we can see why the rail represents a bright future for the transportation industry.
This post was written by Justin Tidd, Director at Swartz Engineering. For nearly a half a century, Swartz Engineering has been at the forefront of industry safety. They are a family-owned company specializing in power distribution for the electrical industry. Our design ensures maximum flexibility for excellent reliability and a high return on investment. Click here for more information.