When it comes to long‐haul freight shipping, rail has clear advantages in economics, logistics, and environmental impact. Trucks offer flexibility, door‐to‐door delivery, and faster short haul service, but over long distances their disadvantages multiply. Rail, by contrast, delivers economies of scale, lower fuel costs per unit, and higher overall efficiencies.

Some of the key strengths of rail in long-haul contexts are:

• Capacity: A single freight train can haul the equivalent of 4 to 5 full truckloads. This means fewer units to coordinate, fewer drivers needed, fewer maintenance stops.
• Fuel Efficiency / Operating Costs: Because trains roll on steel rails, and locomotives can pull massive weights, the fuel and labor cost per ton moved per mile is much lower than for over-the-road trucking.
• Reduced Wear & Tear, Lower Accident Risk: Highways and interstates suffer damage from heavy truck traffic which can impose repair and maintenance costs borne by public authorities. While rail infrastructure, though expensive to build and maintain, benefits from economies of scale and scheduled maintenance. Rail also tends to have much fewer serious accidents per ton‐mile.
• Consistency & Predictability: Rail lines are less susceptible to traffic congestion, weather delays, and bottlenecks that plague road freight. For long distances, this stability often yields fewer delays and more predictable schedules, which is especially valuable in industries with tight lead times, inventory costs, or penalties for lateness.

Cost Savings: Rail vs. Trucking

For example, moving 100 tons of plastic resin (about one railcar or 4-5 trucks) from the Houston
Ship Channel to Denver, over 1,000 miles, highlights the difference:

• Truck: At ~15 cents per ton-mile → $15,000
• Rail: At ~5 cents per ton-mile → $5,000

That’s a savings of $10,000 per shipment, and doesn’t even include drayage, handling fees, or any overtime costs. For any supply chain manager, this “back of the napkin math” makes the rail cost advantage clear.

Environmental Benefits of Rail

Shifting freight from trucks to trains also cuts your carbon footprint:

• Fuel Efficiency: One ton of freight can move nearly 500 miles on a single gallon of fuel, compared to 125-150 by truck.
• Lower Pollutants: Trucks produce more NOₓ, particulate matter, CO₂ per ton-mile.
• Less Congestion: Fewer trucks means less highway traffic and road damage.
• Health Benefits: Reduced truck traffic improves air quality in urban areas.

Costs / Downsides to Be Aware Of

Now I know I’m a railroader, so I have a clear bias. To combat this and to provide a balanced view, I’ll acknowledge that there are a few drawbacks to using rail:

• Rail tends to have longer transit times, especially if the route is indirect, if there are switching delays, or if you need door-to-door delivery (since last-mile dray or truck pickup from rail terminal is required).
• Infrastructure / Accessibility: Not all shippers or warehouses have direct rail access. If your facility is remote or doesn’t have rail spur access, you’ll have to pay for drayage (truck transport to/from the rail terminal) and possibly transloading, which adds cost and handling.
• Schedule Flexibility: Trucks leave when you schedule them (if available); trains follow more rigid timetables, and there may be less flexibility for urgent shipments.
• Handling Costs: Loading, unloading, switching, transloading, yard charges, and terminal fees can eat into savings if not managed carefully.

However, this is where rail transload terminals can provide huge savings and provide great opportunities for customers. Transload terminals are usually well located in a market and work closely with the accompanying railroads to receive quality service. Using a transload facility can save shippers hundreds of thousands of dollars on a rail switch alone, not to mention the additional rail construction costs. There are additional last mile truck fees to get the product to the end location/jobsite/plant, however these
fees are much less than the cost to haul a truck across the country.

Denver / Colorado Market Specifics

Now to focus on the Denver and Colorado region (my stomping grounds), here are how these general advantages play out locally.

Cost Factors and Range in Colorado

• Because Colorado is somewhat landlocked, many long haul shipments (either inbound or outbound) will cross multiple states or travel to/from ports or other major hubs. Whether it’s agriculture products leaving Colorado to go to the port of LA for shipments out to China, or inbound petrochemicals from the Gulf Coast for drilling operations in Weld County, Colorado is a premier rail market due to it’s relative remoteness from major industrial areas.
• Fuel and labor costs in the region tend to be relatively high, particularly for trucking, due to terrain (mountain passes, snow, elevation), weather conditions, and regulatory burdens (e.g. emissions, idling rules). All of this increases the marginal cost of long-haul trucking more steeply than in flatter or milder regions.
• Drayage cost to/from the rail terminal in or around Denver is a factor; but the presence of multiple dual served transload facilities helps mitigate that. The more seamless the integration between rail and the “first/last mile” trucking, the more of rail’s cost advantages can be retained.

Examples / Economic Impacts Locally

Colorado’s geography makes it a prime rail freight market. Because it’s landlocked, most long-haul shipments cross multiple states or travel to/from ports. Rail is often the most cost-effective way to move:

• Agriculture: Crops heading west to the Port of LA.
• Energy & Chemicals: Inbound petrochemicals from the Gulf Coast.
• Construction Materials: Heavy aggregates and metals traveling through mountain passes.

Thanks to dual-served transload facilities in Denver, shippers can access both Union Pacific (UP) and BNSF lines for greater reach and flexibility.

Why Now Is Especially a Good Time

The same benefits we discussed of shipping freight via the rail rather than over the road are multiplied in the Denver/Colorado markets. Let’s focus those same benefits locally on the Colorado market:

1. Rising Trucking Costs: Fuel price volatility, driver shortages, regulatory pressure (hours of service, emissions), tolls, etc., are pushing up the cost of over-the-road transport. These increases tend to scale with distance, so long haul trucking gets hit hardest.
2. Infrastructure Investments: More transload facilities, better rail access, more yard capacity in Denver and along major corridors. Also railroads are investing in efficiency, scheduling, yard handling, which reduces dwell times and improves reliability.
3. Environmental Regulations & ESG Pressure: Colorado has relatively strong environmental standards; both at the state and local level there’s increasing pressure to reduce carbon emissions and air pollution. Companies are increasingly held accountable by investors, customers, and regulators for their carbon footprint. Using rail helps reduce emissions per ton-mile, which can
   contribute to ESG goals and possibly help with incentives, carbon credits, or compliance with air quality rules.
4. Supply Chain Resiliency & Congestion Concerns: Congestion on highways (especially I70, mountain passes, urban congestion in/around Denver) coupled with weather risk (snow, avalanches, road closures) can cause delays and unpredictability for long haul truck shipments. Rail, in many cases, avoids or is less affected by these concerns.

Key Considerations for Shippers in Denver / Colorado

If a business in Colorado is considering switching more of its long-haul freight from truck to rail (or increasing its rail usage), here are important levers & best practices to maximize the benefits:

• Ensure good “lastmile / firstmile” connectivity: Having a transload facility, yard, or spur close enough that drayage costs are modest. The more seamless the transfer is, the more savings you’ll see on your bottom line.
• Optimize for bulk volume: The more weight/volume you can move in a single shipment, the more leverage you get from rail efficiencies. Consolidate shipments if possible.
• Plan for transit time vs urgency: If your goods are time sensitive (e.g. perishable, or customer expectations demand fast delivery), you need to weigh whether the somewhat longer transit plus handling at the ends offsets cost savings. A good supply chain team and scheduler can be worth their weight in gold to support this. Well timed rail shipments can be put in place and in many cases can provide an increased safety stock nearer to your operation.
• Negotiate and plan contracts with rail operators and transloading partners: Volume commitments, consistent shipments, and predictable schedules can help you get better rail rates or priority, reducing delays and demurrage.
• Track environmental / regulatory incentives: Colorado may offer incentives, tax advantages, or grants for greener freight, infrastructure improvements, or emissions reduction. Also, companies may be able to use the reduced emissions from rail in their sustainability reporting (which can have reputational or even financial value).
• Use intermodal solutions when direct rail is not possible: Using rail for the core long-haul leg + truck for pickup/delivery often gives you most of the benefit without requiring your facilities to be rail served.

Final Thoughts

For long-haul shipments, especially in regions like Colorado where distances can be long, terrain can be challenging, and environmental regulations are important, rail offers a compelling cost advantage. Even after considering handling, first/last mile drayage, and potentially slower transit, the savings per ton-mile for rail vs trucking are often in the ballpark of 2 to 3 times cheaper (or more). This factor depends on distance, cargo type, and facility access. The environmental benefits are substantial, lowering emissions, reducing public health impacts, easing highway congestion, and lowering infrastructure wear.

For shippers operating in the Denver / Colorado markets, the presence of dual served rail terminals, expanded transloading capacity, and strong connectivity to major Class I railroads means that switching more long-haul freight to rail can yield both financial and environmental returns.

Trevor McKercher

Director of Sales, Hudson Terminal

Trevor started at US Rail & Logistics in 2023 and has almost a decade of supply chain experience. He spent 5 years working for one of the largest petrochemical shippers in North America where he focused on planning and scheduling a product line as well as managing commercial accounts. He’s passionate about continuing to push for environmental improvements in the supply chain.
Trevor currently resides in Denver, CO.