Dive Brief:
- J.B. Hunt Transport Services’ intermodal business experienced 6% year-over-year volume growth during Q4, the company reported Thursday, one of the bright spots in an otherwise rough quarter.
- EVP and President of Intermodal Darren Field credited an unexpected peak season boost for the segment’s performance, which he said has improved steadily since the spring.
- While executives welcomed the positive trend, intermodal’s $1.62 billion quarterly revenue fell 7% compared to the same period last year — driven by a 13% drop in revenue per load, the company said.
Dive Insight:
A freight recession still plagues carriers as it has for more than a year, according to CEO John Roberts.
But the company’s intermodal performance shows encouraging trends. That business saw 6% volume growth in October, followed by 6% growth in November and an 18% improvement in December, Field said.
“During the (fourth) quarter, we saw a peak season in intermodal that neither we nor our customers, nor our rail providers were expecting,” Field said. The company put 800 more containers into service in Q4, which raised its total to 118,171, up from 115,150 the same period a year prior.
Intermodal’s strong Q4 showing baffled executives, Field said, adding that the company’s customers also were surprised to have a “more significant peak season then they even predicted.”
Field is uncertain whether volume growth will continue into Q1 and beyond. Traditionally freight activity slows at the start of the year.
“I would say that for my entire career that’s been the case,” Field said, adding, “our customers’ inability to tell us about the peak season continues to be a challenge for us to get good solid information about what to expect.”
Conflict in the Red Sea has led to freight diversions, which could benefit western U.S. ports and lead to more intermodal business for J.B. Hunt.
“Certainly, growth of import traffic through the West Coast ports is an absolute benefit to J.B. Hunt,” Field said. The company reported its Q4 transcontinental network loads increased 13%.
Opportunity exists to boost the company’s market share and convert additional freight to intermodal, he said. New offerings involving J.B. Hunt and long-time rail partner BNSF could help in that regard.
That includes a new premium service by J.B. Hunt and BNSF called Quantum, which aims to deliver freight faster than typical intermodal shipping. The carrier noted previously that some 7 to 11 million loads of freight could switch from over-the-road truck service to intermodal.
Another tool available to the carrier is its new U.S.-Mexico service created in partnership with BNSF and Grupo México Transportes.
“We have the people technology and capacity in the network to handle significantly more volume than what we’re handling today,” Field said.
