Intermodal Rail vs Intermodal Trucking: What is Right For Your Shipment?

In Australia, the movement of freight is a vital component of the economy. Whether it’s raw materials or finished products, businesses are constantly seeking the most efficient way to transport their goods to their destination.

However, for many Australian companies, it can be challenging to determine the best approach to ensure goods arrive at their destination safely and cost-effectively. This is where intermodal transport comes in.

In this article, we will explore the difference between intermodal rail and trucking, two of the most common modes of transportation used in Australia. We will examine the benefits and drawbacks of each method.

What is intermodal shipping?

Intermodal shipping is a mode of transportation that involves the use of multiple modes of transportation to move cargo or goods from the point of origin to the final destination. It typically involves the use of two or more modes of transportation, such as rail, truck, or ship, and the transfer of cargo between these modes of transportation at different points along the journey.

Intermodal shipping is often used for long-distance transportation, where one mode of transportation alone is not sufficient to move the cargo efficiently. It offers several advantages, including cost savings, improved efficiency, and reduced environmental impact.

Intermodal rail vs trucking: what is the difference, and what is better?

The main difference between intermodal rail and trucking is the mode of transportation used to move cargo. Intermodal rail involves the use of trains to move cargo over long distances, while trucking involves the use of trucks to move cargo over both short and long distances.

Which method is better will depend on the nature of your shipment. Intermodal rail is often preferred for heavy and bulky cargo that can be loaded onto standardised containers, while trucking is generally preferred for time-sensitive and perishable goods that require faster delivery times and greater flexibility.

Benefits of using intermodal rail

Cost reduction

Intermodal rail provides cost savings compared to traditional trucking because it can handle more volume of freight at once. By combining modes of transportation, shippers can increase the amount of cargo they move while reducing transportation costs.

Transporting goods by rail allows shippers to take advantage of economies of scale, reduce the need for labour, and minimise the costs associated with warehousing.

Rail transport is therefore typically less expensive than trucking, especially over long distances. According to a 2021 report by the Audit Office of New South Wales, rail is generally the most cost-effective method of transporting commodities in high volumes over long distances.

Fuel savings

Intermodal rail uses less fuel than traditional trucking. Freight trains can move goods more efficiently, using less fuel per ton of cargo compared to trucks.

Additionally, intermodal rail allows shippers to take advantage of the latest in fuel-efficient trains (for example, see Pacific National’s recent purchase of C44 Evolution Locomotives), reducing their overall carbon footprint. This fuel savings translates to lower transportation costs and a reduced environmental impact.

Capacity

Intermodal rail offers increased capacity for shippers. Unlike traditional trucking, which is constrained by traffic, road conditions, and congestion, rail networks have significantly greater capacity to transport large volumes of cargo.

Intermodal rail is ideal for shippers who need to move large volumes of freight over long distances. For example, the Port of Long Beach, one of the busiest ports in the world, uses intermodal rail to move goods from the port to inland destinations. This allows the port to handle a high volume of cargo while minimising the impact on local roads and highways.

Environmental impact

Intermodal rail is an environmentally friendly transportation option. Compared to regular trucking, rail transport produces fewer emissions per ton of freight.

According to the Australasian Railway Association, rail freight generates 16 times less carbon pollution than road transport per tonne kilometre. Additionally, intermodal rail can reduce traffic congestion and noise pollution, improving the quality of life for people living near transportation corridors.

Predictability

Intermodal rail offers greater predictability for shippers because the tracks are fixed, and the trains run on a set schedule. This allows shippers to plan their shipments more accurately and reduce the risk of delays caused by traffic, weather, or other factors.

Location-specific benefits

Intermodal rail offers location-specific benefits for shippers. In some cases, it may be more cost-effective to use rail for part of a journey, and then switch to road transport for the rest.

For example, in northern Queensland, it may be cheaper to use rail transport for the journey from Mount Isa to Townsville, which is more than 1,000 kilometres, before switching to road transport for the remainder of the journey. This approach can reduce transportation costs while still providing the necessary level of service.

Disadvantages of using intermodal rail

Despite intermodal rail gaining popularity as a transportation option for cargo in recent years, it has its disadvantages.

Prone to delays

One of the most significant disadvantages of intermodal rail in Australia is its susceptibility to delays. Railways are subject to various disruptions, such as severe weather, equipment failures, and unexpected track maintenance.

These disruptions can cause significant delays in the delivery of goods. For example, in January 2021, a freight train derailment in Victoria caused significant disruptions to intermodal services, leading to considerable delays in the delivery of cargo.

Rigid with re-routing

Intermodal rail is also rigid with re-routing in Australia, which can limit a shipper’s options if a derailment occurs. In these circumstances, because re-routing is not an option on set tracks, a railway company may be forced to close the affected section of track, causing significant disruptions to the delivery of goods.

This can be particularly problematic for shippers who rely heavily on intermodal rail for their supply chain.

Beholden to the railway schedule

Another disadvantage of intermodal rail in Australia is its adherence to a strict railway schedule. Unlike road transport, which can be more flexible, rail transport operates on a set timetable, which can be problematic if a shipper needs to make changes to their delivery requirements.

For example, if a shipper needs to make a change to their delivery time, they may need to wait until the next scheduled train, resulting in delays in the delivery of their cargo.

Limitation to weight and dimensions

Intermodal rail also has limitations on the weight and dimensions of cargo that can be transported. This can be a significant disadvantage for shippers who need to move oversize or overweight cargo.

In Australia, the maximum weight for intermodal rail is dependent on the container size and destination. See the below table for a general outline:

Weight	Details
27 tonne	For 6.1m containers
33 tonne	For 12.2m, 13.7m and 14.6m containers on all rail corridors
35 tonne	For top lift and double stackable 12.2m, 13.7m and 14.6m containers on Melbourne/Perth, Melbourne/Adelaide, and Adelaide/Perth corridors (subject to approval).
30.48 tonne	Services to and from North Queensland
30.48 tonne	All bottom lift containers

Keep in mind, overweight cargo can also attract additional surcharges.

This can limit the amount of cargo that can be moved by rail, which can result in additional costs for shippers who need to use other modes of transport to move their goods.

Benefits of trucking as a mode of transport

Faster delivery times

Trucking is an excellent option for shippers who require faster delivery times. Trucks can travel directly from the origin to the destination, without the need to wait for transshipment at a railway or port. This reduces the time required for cargo to reach its final destination.

Better for time-sensitive goods

Trucking is particularly suitable for time-sensitive and perishable goods. Unlike other modes of transport, such as intermodal rail or ocean freight, trucks offer door-to-door delivery. This means that shippers can control the entire transportation process, ensuring that goods arrive at their destination in the shortest amount of time possible.

This is especially crucial for perishable goods, such as fresh produce, that require timely delivery to maintain their quality.

Flexibility

Trucking also offers a high level of flexibility, which is not available with other modes of transport.

Shippers can, for example, schedule pick-ups and drop-offs at any point along the transportation route. This means that they can customise their transport requirements based on their needs, without being dictated by a railway schedule.

If a customer requires a shipment to be picked up in a remote location (where, for instance, there is no train line) trucking can provide the necessary flexibility to meet that requirement.

Preferred for heavyweight and breakbulk cargo

Trucking is a preferred option for shippers who require the transportation of heavyweight and breakbulk cargo.

Heavyweight cargo typically requires specialised equipment, which can be expensive to acquire and maintain. However, the trucks are generally well-equipped to handle heavyweight and oversized cargo, with a wide range of specialised trailers available for use.

Disadvantages of trucking

While trucking is a popular mode of transport for shippers, it does come with some disadvantages.

More expensive

Trucking can be more expensive than rail. While trucks offer the convenience of door-to-door delivery, they also have higher operating costs due to fuel, maintenance, and labour.

From Sydney to Melbourne, for example, trucks are estimated to use 19 litres of diesel per tonne for every 100 kilometres travelled. This is opposed to only approximately 7.5 litres for rail transport.

Higher emissions

Trucking is responsible for a significant amount of greenhouse gas emissions, making it a less sustainable mode of transport.

According to a February 2021 fact sheet published by the Climate Change Authority, road transport in 2018 was responsible for approximately 85% of Australia’s transport emissions. This is about 16% of the country’s overall greenhouse gas emissions.

On the other hand, despite transporting half of Australia’s freight, rail transport only contributed 4% of total transport emissions.

In a Nutshell

Railway		Trucking
Pros	Cons	Pros	Cons
Cost reduction	Prone to delays	Faster delivery times	More expensive
Fuel Savings	Rigid with re-routing	Better for time-sensitive goods	Higher emissions
Capacity	Beholden to railway schedules	Flexibility	–
Environmental Impact	Limitation of weight and dimensions	Preferred for heavyweight and breakbulk cargo	–
Predictability	–	–	–
Location Specific Benefits	–	–	–

Is intermodal shipping right for your shipment?

Determining whether intermodal shipping is the right choice for your business ultimately depends on your shipment and commercial objectives. If you are shipping large and heavy cargo over long distances, intermodal rail may be the more cost-effective and environmentally friendly option. On the other hand, if you are shipping time-sensitive or perishable goods, trucking may be the better choice due to its faster delivery times and greater flexibility.

To help you make the best decision for your business, it’s important to work with a trusted and experienced freight forwarder like the team at International Cargo Express. As experts in cargo, logistics, and freight, we can help you streamline your supply chain to ensure it is as cost-effective as possible.

With our extensive network of carriers and logistics providers, we can help you identify the most suitable transportation modes and routes to meet your unique needs. Get in touch with International Cargo Express today for expert guidance and support.

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