CEO PERSPECTIVE, RAILWAY AGE, APRIL 2025 ISSUE: Converting freight from truck to rail in North America happens one load at a time. We cannot achieve our grand vision of volume growth and “modal conversion” unless we meet the specific needs of individual shippers, their products, and their customers with innovative tools and services. Doing so will accelerate the tipping point where rail solutions are viewed by the shipper as the first choice.
Through extensive, regular conversations with our shipper customers, the Trinity team found complexity, consistency, and cost to be the perceived barriers preventing many shippers from transitioning more freight to rail.
In terms of complexity, the industry’s seemingly endless jargon and complex system of oversight are just two examples of additional complexity relative to the over-the-road alternative. Simply put, many shippers may be hesitant because they perceive using rail to be too hard. In terms of consistency, I’ll just point out that delivery estimates in rail are provided in days when trucks typically forecast in hours. Finally in terms of cost, it is often unexpected expenses, like those around demurrage and equipment management, which can be most challenging.
To address these barriers for shippers, rail solutions providers must develop and deliver the technological tools and professional human capital resources that are focused on optimization, planning and execution, and railcar management.
• Planning and Execution: Shippers need intuitive tools and services to execute and manage their shipments with professional support ready to step in when needed.
• Optimization: Shippers need easy access to network and industry data to benchmark their performance, monitor network performance, and maximize the value they generate from their rail-focused resources.
• Railcar Management: Shippers need solutions to maintain and improve their railcar fleets informed by experts trained in dealing with the complexity of the industry.
These capabilities can come together to support shippers with their modal transition. Rail shippers will continue to prioritize flexibility and efficiency to optimize supply chain costs and productivity. Global challenges and changing political environments, such as potential changes in tariffs and shifting markets, will continue to place importance on flexibility in planning an optimized supply chain.
In 2023, Trinity acquired RSI Logistics to augment our platform of railcar leasing enabled by manufacturing and services. With this acquisition, the Trinity solution platform expanded to include market-leading rail logistics services, transload terminal operations, and digital logistics tools. These capabilities span the customers’ need for planning and execution, optimization, and railcar management. We believe the addition of these services allows us to approach our customers looking to move more freight by rail with the tools and capabilities they need to make rail easier and identify specific opportunities to drive cost out of their supply chain. By leveraging rail-focused logistics professionals and tools, customers can keep their current workforce focused on the core business and help transition an experienced and retiring workforce.
For example, about a year ago, a small chemical producer came to RSI Logistics looking for input to make a big strategic decision in their supply chain. The chemical producer was shipping their products entirely by truck. After some internal analysis, the company determined trucking was too expensive, forcing them to miss expansion opportunities because they could not afford to extend their supply chain. The professional team of rail logistics experts at RSI taught the shipper the basics of rail and collaborated with them to design their entire rail plan. The chemical producer also used RSI’s Rail Command® digital rail supply chain control tool to simplify the management of their new rail supply chain. This chemical shipper’s strategic shift was a big win for the company and allowed it to serve more distant customers and grow its revenue.
This story is a good example of a small win, but that is how modal conversion will happen. It won’t be a big bang with overnight success. Modal conversion will happen through small, consistent wins with customer-centric solutions that couple the deep expertise of our industry with innovative tools that make rail easier.
