An increase in North American new car production for the second half of 2012, coupled with a shortage of trucks and drivers, could soon make it difficult for used car dealers to find available trucking capacity. As dealers expand their trading zones for pre-owned cars nationwide, reduced truck capacity could also translate to higher shipping costs and longer transport times. Using ShipCarsNow to coordinate auto transport by rail is an easy and affordable alternative when dealers need to ship cars more than 500 miles.
Potential Capacity Shortage
To handle booming new car production in 2000–2005, carriers expanded truck and railcar fleets and hired more drivers. When new car production essentially halted in 2009–2010, those same carriers had to downsize to stay in business. On the positive side, used car shippers benefited from the freed-up capacity and extremely competitive truck prices.
Today, as the transportation pipeline begins to fill back up with new cars, car haulers are scrambling to ramp back up to meet production demands. At the same time, a truck driver shortage and tight credit for new equipment are constraining their ability to respond quickly. This could cause a temporary deficit in used car shipping capacity and drive truck prices higher.
How Multimodal Rail Can Lower Transport Costs
Multimodal rail transport is a smart alternative for dealers faced with truck capacity shortages and rising prices. While dealers may only see the final truck delivery, over 70% of new cars in the U.S. move to market by rail. It is a safe and efficient way to ship cars, and provides significant price advantages over direct truck transport.
As part of Union Pacific, ShipCarsNow provides any size dealership the benefits of multimodal rail and truck shipping plus direct truck transport for time-sensitive moves. Dealers can ship one or two vehicles by rail, through co-loading initiatives with new and remarketed vehicles where the volumes are available.
When new car production eats up truck capacity, rail auto transport is an affordable alternative for shipping cars across the country. With the option to use cost-efficient rail transport, truck capacity issues won’t limit a dealer’s profitability or capacity to maintain the optimal inventory to meet their customers’ needs.
Every year, ShipCarsNow, and their parent company, Union Pacific, transport more than 4,000,000 cars around the country, 99.7% damage-free. For more information visit www.shipcarsnow.com.