Rail Strike Might Disrupt Trucking Industry
A potential freight rail strike might break out and seriously disrupt the supply chain. If the country’s railways can’t reach an agreement with unions representing approximately 60,000 workers, about 30% of all freight movements within the United States risk being suspended.
Administrators of logistics are revising their plans in preparation for a potential rail strike that may disrupt the supply chain and cost the American economy up to $2 billion per day.
Prudent shippers had a strategy in place already a month ago, and the majority of those that didn’t have increased their contingency planning in the aftermath of last month’s reality check.
What impact would a rail strike have on the trucking sector?
Trucking is the greatest client of the rail sector, and trucks provide the last mile of almost every commodity that rail moves, despite the fact that trucking and rail companies rival ground freight. The likelihood of a rail strike has increased in recent weeks, prompting the US government to start talking about backup preparations.
Although the trucking sector has had problems with supply chains before, this would significantly impact over-the-road supply.
Around 60,000 union employees who work for the railroad, including conductors and engineers, are scheduled to strike. The nation’s freight is transported via the train system, which would rapidly come to an end if the conductors and engineers went on strike.
Trucking routes could become unbalanced
Although there are much fewer individuals employed in the rail sector than there were many years ago, railways are still an essential component of the nation’s shipping sector. More than 324,000 cargo are transported weekly by railroads. Truckload capacity would be directly impacted by a rail strike, becoming uneven and oversold.
Goods are transported by trains from ports to distribution centers. Trains are designed to haul heavy loads of materials like coal, chemical, and grain. A single train car may hold anywhere from three to five semi-trucks. Just to transfer chemical items, a rail strike would result in an extra 200,000 tanker truckloads each week.
There will be a need for new ways to increase trucking capacity
If trucks are required to supplement the loss of rail freight alternatives, the already overcrowded ports would be put under even more pressure. The possibility of a rail strike exists, therefore companies that depend on shipping should make every effort to get ready for yet another significant interruption. Technology in freight procurement can help with this.
As the transport industry develops, automation technology has improved dated transportation management procedures, enabling shippers to make rapid decisions. When necessary, shippers may now flexibly access asset-based, legal truckload capacities.
Shippers can use automation to obtain extra capacity, for instance, if contracted carriers start to refuse loads or to prevent price gouging in spot transactions. AI uses a shipper’s specific load qualities to select the ideal carrier at the ideal time, location, and price so that shippers always deliver products on time and pay fair market value.
Data based decisions
To determine how to pivot effectively when disruption happens, it is essential to get a thorough picture of everything that is happening in the supply chain. However, a lot of logistics experts concur that one area where there are data holes is transport operations.
Forward-thinking shippers are starting to ask third-party logistics for data transparency. Knowing carrier information such as cost, acceptability, and OTD% history will enable shippers to distinguish between carriers who are more likely to maintain the flow of products and those who may be overwhelmed by the interruption.
Being proactive is crucial when there are impending events like a rail strike. With the correct data, shippers can see patterns and get insight into future developments so they can plan ahead and stay competitive.