MEASURING INTERMODAL PROFITABILITY

The profitability of intermodal operations provided by the rail industry and commonly known as trailer-on-flatcar (TOFC), or piggyback, service has been questioned in recent years. Although TOFC loadings have increased, the growth has not been as rapid as many believe possible; the industry's hesitancy to make the necessary investment and the reluctance of other modes to take advantage of rail line haul are indications of this situation. Although railroad-costing methodology has improved in the past decade, difficulties still exist in ascertaining profitability of any one segment of traffic. The difficulty of allocating costs prevents costing officials from accurately determining intermodal costs and hence profitability. It is this situation that confronts management with investment decisions and present the Federal Railroad Administration (FRA) with problems in the promotion of intermodal operations in the rail industry. Congress provided funding for the FRA to partially offset operating losses in intermodal demonstrations under certain criteria; the most important of these are potentially profitable operations. In view of the problem with railroad-costing methodology, how should the profitability be measured? The FRA is funding research in two phases to develop an Intermodal Management Information System (IMIS). The first phase, an overview of rail information systems and a state-of-the art survey, confirmed the need for an IMIS and identified three modules that could be readily transferred In various stages of development and testing are an Intermodal Management Equipment Control System (IMECS), which generates adequate records for detention billing and control of trailers, and a Repetitive Waybilling and Rating System (RWRS), which electronically maintains a comprehensive audit trail of waybill activity. Both these systems (and other sources) provide an automated collection of intermodal records to ascertain profitability for the rail carrier. (Author)

Media Info

  • Media Type: Print
  • Features: Figures; References; Tables;
  • Pagination: pp 81-88
  • Monograph Title: Surface Freight: Rail, Truck, and Intermodal
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00325470
  • Record Type: Publication
  • ISBN: 0309030730
  • Report/Paper Numbers: N763
  • Files: TRIS, TRB
  • Created Date: Feb 18 1981 12:00AM