The strategy of transloading, which involves moving freight between truck and rail, has seen a resurgence due to increased container volumes at U.S. West Coast ports. This method gained prominence during the COVID-19 pandemic to manage supply chain disruptions and is now becoming a permanent feature. Companies like CH Robinson, DHL, Uber Freight, and ITS Logistics are experiencing a rise in transloading requests. Wall Street analysts believe that transportation companies such as Union Pacific, JB Hunt, Schneider, and Knight-Swift will benefit, though they still face pressures from the recent freight recession.
Transloading is particularly advantageous for retailers and suppliers, offering cost savings and flexibility by distributing smaller freight loads to various ports. This method also helps circumvent current global supply chain issues, such as the Panama Canal drought and Red Sea diversions. The strategy supports a shift from East to West Coast ports, driven by labor strike threats and logistical benefits.
The overall increase in transloading demand is leading logistics companies to expand their capacities and services. For example, DHL Global Forwarding Americas has ramped up its transloading operations on both coasts. This strategy is also influencing early peak shipping seasons due to extended transit times caused by global disruptions. Additionally, cross-border trade with Mexico is contributing to the growing interest in transloading, driven by new rail options and increasing traffic.
- Transloading Popularity: Increased use of moving freight between truck and rail, especially at U.S. West Coast ports.
- Pandemic Influence: Gained traction during COVID-19 to manage supply chain disruptions, now becoming a permanent feature.
- Company Adaptations: CH Robinson, DHL, Uber Freight, and ITS Logistics report rising transloading requests.
- Economic Impact: Transportation stocks like Union Pacific, JB Hunt, Schneider, and Knight-Swift are expected to benefit.
- Logistical Advantages: Saves costs and time for retailers and suppliers by distributing smaller loads to various ports.
- Global Supply Chain Issues: Panama Canal drought, Red Sea diversions, and labor strike threats drive the shift from East to West Coast ports.
- Capacity Expansion: Logistics companies increasing capacities, e.g., DHL expanding operations on both coasts.
- Early Peak Seasons: Extended transit times due to global disruptions prompting earlier peak shipping seasons.
- Cross-Border Trade: Growing interest in transloading in Mexico, enhanced by new rail options and increased traffic.