Amazon Launches Intermodal Shipping Options to Help Sellers Cut Freight Costs
Amazon launched an intermodal shipping program that blends rail or ocean legs with first‑ and last‑mile trucking for inbound shipments. On lanes over 500 mi the cost per mile drops from roughly $2.80 to $0.80, cutting overall freight spend by 30‑40 % while adding 1‑3 days transit and reducing emissions by about 75 %.
Overview
Amazon has rolled out a new intermodal shipping program that blends rail and ocean freight with traditional trucking for inbound shipments to its fulfillment centers. The service, announced in a recent seller webinar, targets the steep rise in road‑freight costs that many third‑party sellers face. By shifting the long‑haul portion of a shipment to rail or sea, sellers can lower transportation expenses, gain more predictable pricing, and reduce carbon emissions.
Key Points
- Rail‑and‑sea option added — Sellers can now select a mixed‑mode route where trucks handle only the first‑mile pickup and final‑mile delivery, while rail or ocean carriers move the cargo across the bulk of the distance.
- Cost advantage — Rail moves freight at roughly one‑quarter to one‑third the cost per ton‑mile of a truck, delivering the biggest savings on trips longer than 500 miles.
- Stable rates — Intermodal tariffs change less frequently than spot‑market trucking rates, which often surge during Prime Day, the holiday season, or any period of driver shortage.
- Lower fuel surcharges — Because rail fuel surcharges are smaller and less volatile than those applied to trucks, sellers see reduced exposure to sudden fuel‑price spikes.
- Environmental benefit — Transporting a ton of goods by rail emits about 75 % fewer greenhouse gases than moving the same ton by road.
- Transit‑time trade‑off — Adding rail or sea legs typically adds one to three days compared with a direct truck run, a delay that can be managed with proper inventory planning.
How Intermodal Shipping Works
- Select an intermodal lane — In Seller Central, a seller chooses a route that pairs a rail or ocean carrier with a local trucking partner. For example, a vendor in Los Angeles shipping 30 pallets to the Dallas fulfillment center would pick a rail corridor that runs from the West Coast port to a rail hub near Dallas.
- Book first‑mile pickup – A contracted truck picks up the pallets from the seller’s warehouse and delivers them to the designated rail terminal. In the same scenario, a regional truck moves the load from the Los Angeles warehouse to the Long Beach rail yard.
Analysis & Recommendations
Why This Matters
Sellers can lower inbound freight costs by up to 40 % and shrink fuel surcharges from $0.30 to $0.05 per mile, improving margins. The added 1‑3‑day lead time requires inventory forecast adjustments but also offers a greener supply chain with ~75 % lower CO₂ per ton.
Key Takeaways
- Rail‑and‑sea intermodal lanes cost about $0.80 per mile versus $2.80 for full‑truckload on long hauls.
- Fuel surcharges drop from $0.30 to $0.05 per mile when using rail or ocean legs.
- Transit time increases by 1‑3 days compared with direct trucking, so safety stock must cover the longer lead time.
- Shipping a ton by rail emits roughly 75 % fewer greenhouse gases than by road.
Recommended Actions
- →In Seller Central, go to Shipping > Intermodal Shipping and select lanes longer than 500 mi to enable the rail/ocean option.
- →Adjust inventory forecasts in the Restock Inventory tool to add 1‑3 days lead time for intermodal shipments.
- →Contact listed intermodal carriers via the Seller Central announcements page to obtain rate sheets and confirm service for your target fulfillment ...
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