Rail/Intermodal
Intermodal and carload traffic volumes showed normal seasonal behavior ahead of the coming lull during the Christmas and New Year’s holiday period. Intermodal volumes ticked down slightly on a sequential basis with what little weakness there was focused on the container market. The trailer side of intermodal has likely reached its seasonal parcel peak for the year near 16,500 trailers and is likely to move back lower from that high water mark.
On the carload side, volumes moved back a bit as most categories dipped to their five-year average levels in the latest week. Chemicals in particular suffered a significant decline, but it remained near its average 2023 result of 45,000 carloads per week in the latest result. Automotive traffic was an outlier with volumes surging past 28,000 carloads in the latest week to hit their 2023 weekly volume high.
Rail Service
Rail service levels remain near historical averages in recent weeks, which is a level that it has seen for much of this year. Rail service measured by velocity has increased markedly since 2022 but has improved only back to its historical average level. This performance is unlikely to be enough to encourage shippers to move goods from truck to rail or for regulators to let up on their focus on improving overall levels of rail service.
Headcount levels have stabilized in recent months as carriers slow or stop the aggressive headcount additions they made over the last year. This will bear watching as winter grows deeper and the potential for weather-related service complications increases.
