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FTR’s Intermodal Competitive Index Rebounds in August

October 21, 2016 By: Trucking News Staff Tags: Fleet Management, News
FTR’s Intermodal Competitive Index Rebounds in August

FTR’s Intermodal Competitive Index (ICI) rebounded from July to a reading of 2.16 in August. The updated August reading — while certainly not particularly strong — does ease some of the concerns that the weak July reading created and, in some measure, confirms suspicions that the number of work days in July impacted the index negatively.

Most of the gain can be traced to slightly tighter over-the-road trucking utilization rates. August domestic intermodal volume was up nicely over July, but International volume is still problematic.

Larry Gross, partner at FTR and principal author of Intermodal Update, said, “Although competitive conditions for intermodal remain challenging, more favorable conditions remain on the horizon. Although not yet reflected in trucking rates, we believe that trucking capacity is slowly beginning to tighten in anticipation of the implementation of the Electronic Logging Device mandate, now 14 months away. This should result in a better climate for intermodal as we move through next year.”

The Intermodal Competitive Index is a compilation of factors affecting the competitive posture of the domestic North American intermodal sector versus over-the-road truck. Any reading below zero indicates a less-than-ideal environment for intermodal, while readings above zero are meant to communicate relatively favorable conditions.

The higher the reading, the more favorable the intermodal environment appears to be. The ICI looks at a variety of factors, including truck capacity, fuel prices, rail service, intermodal rates, and so forth. Details of the factors affecting the August Intermodal Competitive Index, along with a close look at market conditions and what might be expected going forward, can be found in the October issue of FTR’s Intermodal Update published earlier this month.