Should the freight rail industry be overhauled?

Rows of tanker cars parked at a rail yard.

Service disruptions at the Class I railroads have come to a head in recent weeks, and shippers and the unions representing rail workers are clamoring for changes to the freight rail industry of a magnitude to match the disruptions.

Some examples of subpar rail service: Excessive dwell times at the origin, resulting in the doubling of transit times between the Midwest and West Coast for grain shippers and tardy arrivals that pressure flour and feed mills and ethanol plants to temporarily cease...

What is operating ratio?

A photograph of a train locomotive and a truck trailer.Just what is operating ratio?

Operating ratio (OR) is a way for investors to compare the financials of one company against its peers. Investors use OR to gauge whether a company is generating sufficient profits. 

The formula to calculate OR is to divide a company’s operating expenses by its revenue. Put differently, it is one minus the operating margin percentage. For example, a 20% operating margin is the equivalent of an 80% operating ratio. Operating expenses include items such as fuel,...

Carrier profits surge thanks to pandemic freight boom

Chart of the Week:  Operating Ratio for TCA Van Carrier – Company and Leased Fleet, Van Outbound Tender Rejection Index – USA SONAR: OPRAT.VCFOO, VOTRI.USA

The average dry van carrier operating ratio (OR) for Truckload Carriers Association (TCA) members dipped to a multiyear low in September, falling below 94% for the first time since late 2015. Operating ratio is the ratio of operating expense to operating revenue — lower values indicate a more profitable operation. The boundary was crossed as...

Volumes surge, carriers break even and seek help from tech

White truck backed into dock to unload

Make no mistake – freight volumes are on the rise, but the movement of goods appears to be rooted in warehouse and inventory redistribution instead of consumer-facing activity. Rates are therefore still suppressed, and capacity remains loose. To improve their operations, carriers are accepting almost all contracted loads, optimizing hours of service and fully utilizing their telematic technology to decrease dwell times. 

While the southern California freight market has been a pivotal force in...

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