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Schneider National Consolidates Eastern Rail Operations Under Norfolk Southern

Schneider National is consolidating its eastern intermodal operations with Norfolk Southern, marking a significant realignment in the transportation company's rail strategy. The shift ends Schneider's prior arrangement with CSX, positioning Norfolk Southern as its exclusive eastern rail partner while Union Pacific handles western operations.

Michael Baumgardt, Schneider's executive vice president of Intermodal and Logistics, said the decision reflects an evaluation of network reach, train frequency and customer proximity. Customers responded positively within 24 hours of the announcement, particularly regarding Schneider's asset-based model featuring company drivers, chassis and containers.

Norfolk Southern's Shawn Tureman noted the railroad has been expanding its intermodal franchise, growing from third to second-largest in the U.S. by 2018. The company plans to double its intermodal capacity again.

The current rate environment supports the move, with truckload rates carrying a 30%-plus premium over intermodal alternatives. Dray capacity and driver supply remain primary constraints.

Both executives clarified that the pending Norfolk Southern-CSX merger was not the driver of this strategic realignment.