Freight Rail Index at NEAR DECADE HIGH! | Economy Rebounding?

The latest rail traffic data is in, and it paints a surprising picture of economic recovery. The Freight Rail Index has reached its second-highest level since 2008, indicating a significant rebound in the industrial sector. We break down the North American carload and intermodal numbers, highlighting key growth areas and shifts in freight patterns, including a notable 4.7% increase in US carload traffic when excluding coal. This trend suggests a broader economic expansion beyond just data centers. Discover what these figures mean for the future of manufacturing and logistics.

North American rail traffic rose 3.6% in Week 31, with carloads up 3.9% and intermodal up 3.3%, according to Association of American Railroads data — and a broader monthly snapshot shows the industry’s Freight Rail Index, which measures seasonally adjusted volume excluding coal and grain, has now climbed to its highest level since 2008 after four consecutive months of gains.

The figures matter to carriers, brokers, and shippers because rail volume grew faster than overall GDP during the period — a milestone that, according to Bill Stephens, hasn’t been seen since before the Great Recession. “Rail traffic grew faster than overall GDP,” Stephens said. “We haven’t seen that in a long time.”

Stripping out coal, the numbers look even stronger. U.S. carload volume excluding coal was up 4.7% for Week 31, well ahead of the flat volumes recorded over the prior four weeks. July carload traffic, also excluding coal, was up 3.2%, while intermodal set a record for the month of July and posted a 6.1% year-over-year gain — its sixth consecutive month of growth, and the seventh straight month of overall carload expansion.

“Manufacturing and rail activity are moving along together. The manufacturing is expanding at a pace not seen in several years, which underscores the close link between factory output and rail volumes,” Stephens said, citing AAR’s Rail Industry Overview released the week of the data.

Intermodal’s momentum is drawing freight away from trucks, with a 34% price discount between intermodal and truckload rates cited as a key driver. FreightWaves data showed both the Truckload Volume Index and loaded rail container volume each rose exactly 4.4% over the most recent three-month period — a near-perfect offset that helps explain why spot truck demand has not accelerated despite a broader freight recovery. Stephens noted that shippers typically need a sustained belief in economic stability and tight capacity before committing to intermodal conversions.

Geographically, growth is shifting. North-south corridors — particularly Chicago-to-Atlanta lanes and new intermodal services connecting Mexico’s industrial regions to the U.S. Southeast and Chicago — are outperforming the traditionally dominant, and now mature, Chicago-to-East Coast lanes.

On the regulatory front, a U.S. District Court upheld the Federal Railroad Administration’s two-person crew rule, which the FRA finalized in 2024. Several Class I railroads, the AAR, and the Short Line Association had challenged the rule as arbitrary and beyond the FRA’s authority. The decision leaves open whether railroads will pursue further appeals. Fuller noted the ruling creates a tension with broader DOT policy encouraging autonomous truck development, with railroads arguing the mandate prevents them from exploring single-person or autonomous operations. Separately, Amtrak is facing locomotive availability problems in the Midwest, prompting Stephens to file a Freedom of Information request with the agency Monday morning to determine the scope of the issue.

• The AAR Freight Rail Index (excluding coal and grain) reached its highest level since 2008 after four straight months of gains.
• U.S. carloads excluding coal rose 4.7% in Week 31, and intermodal set a July record with 6.1% year-over-year growth.
• A U.S. District Court upheld the FRA’s two-person crew rule, leaving railroads’ path to autonomous or single-operator trains uncertain.

This Summary is generated thanks to a transcription of the interview, for the full interview please enjoy the video above.