Trends in Intermodal Freight Transport: J.B. Hunt ... ?· next. move?™ | 3 . Intermodal Rail Carrier…

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  • Ken Miller Vice President, Intermodal J.B. Hunt Transport, Inc.

  • 1 Whats your next move? |

    Ken Miller, VP of Intermodal Operations

  • 2 Whats your next move? |

    SERVICE REVIEW: MARKET SHARE

    Market overview (segment specific) Market size: $12 Billion

    Capacity: 205,000 53-foot Containers

    Industry outlook: Growing at > 7%

    Our position 25 - 28% of overall market (revenue and/or capacity)

    Opportunities Highway Conversion

    Customer Deliveries

    New Services Canada/Mexico/Eastern Network Expansion

    Roadblocks Market Share

    Competitor Actions

  • 3 Whats your next move? |

    Intermodal Rail Carrier Industry Comparison

    INTERMODAL VOLUME

    2011

    SALES APPROACH CAPACITY

    4.5 M

    3.3 M

    2.3 M

    3.2 M

    BNSF & Motor Carriers

    Motor Carriers

    Unlimited

    IMC Limited by fleet size

    IMC & Motor Carriers

    Limited by fleet size

    Limited by fleet size

    LARGEST SEGMENT by volume

    Intermodal

    Industrial Products

    Coal

    Industrial Products

    Rail Owned

    Containers

    Containers

    Trailers & Containers

    EQUIPMENT OWNER

    IMC & Motor Carriers

    Rail Owned

    Rail Owned

    Containers

    Type

  • 4 Whats your next move? |

    Estimated 53 Domestic Fleet by Owner

    200

    200

    350

    450

    500

    500

    800

    1,000

    1,300

    1,700

    2,200

    4,000

    5,000

    8,000

    10,200

    15,800

    18,000

    23,100

    32,700

    35,300

    65,700

    - 10,000 20,000 30,000 40,000 50,000 60,000 70,000

    FEC

    Matson

    Dart

    NS/KCS

    KCS

    Marten

    COFC Logistics

    CH Robinson

    Universal Logistics

    Other

    APL Logistics

    CSX

    UPS

    CN

    Swift

    Schneider

    Pacer

    Hub

    UMAX

    EMHU

    JB Hunt

    Total Fleet Size 227,000

  • 5 Whats your next move? |

    Source: Establish, Inc/Herbert W. Davis and Company 2006 Database

    LOGISTICS COST BREAKDOWN

    50%

    22%

    10% 8%

    4% 3% 2% 1%

    Transportation Inventory Labor Customer Rent Admin Supplies Other

    Transportation is generally the greatest cost in the supply chain.

    Focus on Transportation

    Collaboration to reduce costs

    and increase capacity.

    Supply Chain Opportunities

  • 6 Whats your next move? |

    Todays Supply Chain Landscape

    Shippers are looking for partners with flexible, comprehensive, value added solutions

    Steadily increasing freight demand

    Truckload capacity continues to tighten

    Supply/demand balance becoming an issue

    Intermodal volumes continue to rise and take highway share

    Diesel prices remain elevated

    CONFIDENTIAL

  • 7 Whats your next move? |

    Top Supply Chain Challenges (Next 2-5 Years)

    Tightening driver market

    Government regulations CSA EOBR mandates Hours of Service CARB

    Aging equipment leads to replacement at higher cost basis

    Highway infrastructure congestion and deterioration

    Access to capital

    Fuel

    Managing Budgets

    CONFIDENTIAL

  • 8 Whats your next move? |

    Intermodal Benefits Are Driving Change

    Shippers, Carriers, Environment

    Economical

    Expanding capacity

    Greener shipping

    Less congestion

    Better jobs

    CONFIDENTIAL

  • 9 Whats your next move? |

    So Why Hasnt More Freight Been Converted?

    Some Shippers Say

    I had a bad experience with Intermodal 15 years ago.

    Shipping requirements wont allow Intermodal.

    Intermodal transit is slow and variable.

    Wont work for my customers.

    CONFIDENTIAL

    Miller_coverMiller_JB Hunt EPA May 2014

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