Intermodal pricing to rise in 2025 amid tariff uncertainty
Intermodal pricing expected to climb
Intermodal volumes in January were slowed by weather but still managed an 8% year over year (y/y) increase. Most models do not expect this pace to continue, projecting volumes to settle into a pace around 3% growth y/y for the remainder of 2025.
Several factors contribute to the higher intermodal volumes
Concerns over tariffs
Many importers pulled orders forward to keep costs down before new tariffs went into effect. That pre-tariff ordering is continuing to filter into the market even as some new tariffs are put in place. Tariffs will be a key factor in how hot the market continues to be in 2025. While there is uncertainty around long-term costs, it remains to be seen if this will lead to a softening of demand in the future. If that does occur, the effects may be felt later in 2025 and into 2026 due to long buying and stocking cycles.
Preemptive cost savings opportunities
Related to tariff uncertainty, some importers are preemptively looking for cost savings within their transportation networks. Accordingly, they are more willing to look at increasing lead times to accommodate intermodal transit times if it can help mitigate price increases. Intermodal's longer average transit times are an advantage in building inventory at a slight discount, allowing for a more gradual buildup of stock.
Improving comparisons to truckload
The rails have been staying more closely aligned with the spot truckload market than they have in previous cycles. As part of this, the rails have allowed the gap between over-the-road truckload and intermodal spot rates to widen a bit, making it more competitive. This is allowing for more lanes to be viable for conversion to intermodal.
2025 intermodal pricing prospects
Intermodal pricing is expected to climb in the low, single-digit range through 2025, peaking with a 5–7% increase in spot rates in Q4 of 2025. Recent rail labor agreements signed by the U.S. railroads and persistent inflation are expected to drive this increase. With rates already on the rise, securing intermodal contracts now could be advantageous.
Intermodal spot rates remain depressed, reflecting the current truckload market. Currently the rails are content to try to capture more volume. They have allowed the average discount to truckload to widen to 30%. Historically when that gap is greater than 20%, we see a shift towards intermodal. However, railroads anticipate a significant surge in spot pricing during the latter half of 2025. If they are correct, this suggests Q1 2025 could offer the year’s most competitive rates.
Intermodal service: Strong despite volume
Despite increased volume and demand, intermodal service metrics, such as train speeds, are performing well, even if slightly below the five-year average.
With strong service and low pricing, contact your C.H. Robinson representative to see how you can best take advantage of intermodal service within your portfolio.