LOGLogistics & transportationStop 8 of 10
Intermodal & drayage
Moving containers between ship, rail and road, and managing the short truck legs and free-time charges that decide the real cost.
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Intermodal transport moves goods in a standard container across more than one mode without unpacking them: a container leaves a plant in Ludhiana by truck, rides a train to a port in Gujarat, crosses the ocean by ship, and finishes by truck to a warehouse abroad. Because the box itself is moved by crane, transfers are quick and the goods are handled less.
The cheap long-haul modes (rail and sea) carry the heavy kilometres; road handles the short ends. Those short truck legs, between port or rail yard and the shipper or consignee, are called drayage. They are short but often the most delay-prone and costly per kilometre part of the trip, because of port congestion, gate queues and appointment slots.
Time is money at the terminals. Shipping lines and terminals give a few free days to pick up or return a container, then charge:
- Demurrage: for leaving a container inside the port or terminal beyond the free time.
- Detention: for keeping the shipping line’s container outside the terminal (at your warehouse) beyond the free time.
These charges can add up quickly, which is why planning pickups, unloading and empty returns carefully matters as much as the freight rate.
In India, inland container depots (ICDs) let containers clear customs inland and move to ports by rail, and dedicated freight corridors are making rail more attractive for container flows.
Words to use
- Drayage
- Short truck moves of containers to and from ports or rail yards.
- Demurrage vs detention
- Charges for containers held too long inside the terminal, or kept outside it too long.
- ICD
- Inland container depot: an inland terminal where containers are handled and cleared by customs.
One container, two ways
Illustrative costs for one 40-foot container on a route of about 1,200 km:
- All road: ₹75,000, about 3 days.
- Intermodal: ₹8,000 truck to the inland container depot, ₹42,000 rail to the port, ₹6,000 terminal handling: ₹56,000, about 5 days.
Intermodal saves ₹19,000 per container, as long as the rail schedule fits the vessel cut-off and the container doesn’t wait at either terminal.
The saving can vanish quickly. If the container misses its vessel and sits at the port for three days beyond the free time, demurrage at a few thousand rupees a day eats into it, and a missed sailing can delay the shipment by a week.
Free time, demurrage and detention
- Free time: the days the terminal and shipping line allow before charges start.
- Demurrage: for a loaded or empty container left inside the terminal beyond free time.
- Detention: for keeping the shipping line’s container outside the terminal (at your factory or warehouse) beyond free time.
Planning pickups, unloading and empty returns within free time is part of the freight cost, not an afterthought.
Choosing container sizes
- 20-foot containers (one TEU) suit heavy cargo such as metals, ceramics and grains, which reach the weight limit before filling the space.
- 40-foot and 40-foot high-cube containers suit light, bulky cargo such as garments, furniture and electronics.
- Refrigerated containers for food and pharmaceuticals need power at every stage, including rail and storage yards.
Inland container depots
An ICD is an inland “dry port”: containers are stuffed, customs-cleared and sealed inland, then moved by rail to the seaport. Exporters far from the coast get port services near their factories, and the rail leg moves the heavy kilometres efficiently.
Empty containers and trade imbalances
Containers go where trade flows. When a region exports more than it imports, empty boxes must be brought in to load exports, and someone pays for repositioning them. During the disruptions of 2020–21, containers piled up in the wrong places, freight rates soared and exporters struggled to get equipment. Container availability, not just the freight rate, is part of intermodal planning.
Infrastructure shifting the balance in India
- Dedicated freight corridors: separate freight tracks, with double-stack container trains on the Western corridor towards the ports of Gujarat and Maharashtra, give faster and more predictable rail transit.
- Inland waterways: National Waterway 1 on the Ganga, and others, offer low-cost movement for bulk and containers where volumes and draft allow.
- Coastal shipping: moving containers between Indian ports by sea instead of long road hauls, encouraged under the Sagarmala programme.
- Multimodal logistics parks: hubs that combine rail, road and warehousing.
Documentation and responsibility
International intermodal moves involve the bill of lading (the contract of carriage and title document), customs filings at the ICD or port, and Incoterms that decide who pays and carries risk for each leg. A single through bill of lading covering all legs simplifies paperwork and claims; separate contracts for each leg give more control but more interfaces.
Comparing honestly
A fair comparison of road against intermodal includes:
- door-to-door cost, including drayage, terminal handling and any storage,
- door-to-door time and its variability, not just the rail transit,
- the inventory cost of slower or less predictable delivery,
- damage risk from extra handling (lower for containers than for loose cargo),
- emissions, which are usually much lower for rail and sea.
Interview kit
Practise it out loud
Answer each question yourself before opening the model answer.
Intermodal transport moves standard containers across rail, sea and road without re-handling the goods, so long hauls go by cheaper modes and road covers the ends. The ends, drayage, are short but congestion-prone, and terminal free time matters: demurrage applies to containers held in the terminal too long, detention to containers kept outside too long. I’d plan pickups, unloading and empty returns to avoid those charges and compare intermodal with direct road on total cost and transit time.
What is the difference between demurrage and detention?
Demurrage is charged when a container stays inside the port or terminal beyond the free days. Detention is charged when the shipping line’s container is kept outside the terminal, for example at your warehouse, beyond the free days before being returned.
When does intermodal beat direct road transport?
On long distances with steady volumes, where rail or sea cost per tonne is much lower, and when the extra transit and handling time is acceptable for the product. For short distances or urgent, irregular shipments, the extra drayage legs and terminal time usually make direct road better.
Connected stops
Where this idea feeds in, or gets its inputs from.
Sources and further reading
- Chopra, S. & Meindl, P. Supply Chain Management: Strategy, Planning, and Operation. Pearson. Chapter on transportation in a supply chain.
- Rodrigue, J.-P. The Geography of Transport Systems. Routledge. Free online edition.
- Rodrigue, J.-P. (2020). The Geography of Transport Systems (5th ed.). Routledge.
- Levinson, M. (2006). The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger. Princeton University Press.