Intermodal services need to be the top priority if the transportation industry is to reduce its carbon footprint while maintaining efficient and productive operations, the chief sustainability officer at J.B. Hunt Transportation Services Inc. (NASDAQ:JBHT) said Thursday.
Keynoting FreightWaves’ Net-Zero Carbon Summit, Craig Harper, who is also an executive vice president of the Lowell, Arkansas-based transportation and logistics giant, said that all shipping stakeholders need to evaluate every load to determine if it can be shipped via intermodal rather than over the road, even for medium-distance hauls that once were considered beyond the scope of intermodal’s capabilities.
Once considered relevant only at 1,200 miles or more, intermodal services have become so effective in serving the medium-haul market — roughly defined as 800 to 1,200 miles — that it would be hard to justify using over-the-road carriers for any load that takes more than one day to travel, Harper said.
“Intermodal needs to be on everybody’s mind,” Harper told FreightWaves’ President George Abernathy.
Between 7 million and 11 million loads today meet the environmental and economic criteria to be shipped via a combination of trains and trucks, Harper said. Because of its unmatched economies of scale in the domestic U.S. market, the rail portion of intermodal services has long been considered the most cost-effective means of shipping, as well as the most environmentally sound.
Hunt reduced its carbon emissions levels by 3.4 million metric tons in 2020 by shifting loads to intermodal, Harper said. It also eliminated 4.3 million empty truck miles through the increased reliance on its J.B. Hunt 360 digital freight platform, he said.
Though Hunt’s roots are in truckload transportation, intermodal has become its core business, accounting for nearly half of its quarterly revenue. Founder Johnnie Bryan Hunt is considered the first trucking executive to have grasped the vast potential of converting over-the-road shipments to train services.
The road to net-zero carbon emissions — transport and logistics services account for 30% of U.S. greenhouse gas output — will be long and expensive and will require patience, Harper predicted. Stakeholders will have to prove that the “total cost of ownership” of vehicles powered by batteries and hydrogen fuel cells are comparable to that of diesel-powered equipment, he said. Currently, so-called clean-powered vehicles cost about three times that of diesel, he said, adding that government subsidies and incentives will be necessary for that gap to be narrowed because the expense to do so will be too much for private industry to bear on its own.
All logistics players are being pressured on multiple fronts to demonstrate their commitment to slash their carbon footprint, Harper said. He advised shippers to thoroughly examine their current processes to see where changes can be made and to work closely with data-reporting agencies that provide an unvarnished view of a shipper’s strengths and weaknesses. “The things you’ll see will open up your eyes,” he said.