Rail intermodal logistics, the movementof containerized cargo from origin to destination where aportion of the journey takes place on rail, have gainedsignificance in North America over the past 10 to 15 yearsbased on cost and operational efficiency. In China, however,the story has thus far been different. Considering thelength-of-haul and commodity characteristics of China smanufacturing sector, the country has a persistently lowincidence of rail intermodal participation in domestic andinternational supply chains. We find that the bindingconstraints behind the low incidence of rail intermodalservices in China are most likely to be found on the supplyside, not the demand side of the equation. Specifically, theregulatory and institutional environment, which regulatefreight tariffs and provides little or no flexibility forChina Railway Corporation (CRC) to tailor services tocustomer needs, is at the root of this challenge. This noteoutlines the success of railways in North America in (a)tailoring rail intermodal service offerings based oncustomer needs and willingness to pay; and (b) collaboratingwith other logistics service providers so as to concentrateon their core (rail transportation) competency, whileleaving other segments of the end-to-end intermodal supplychain to those most efficient in those segments. The currentpolicy and economic environment facing CRC seems favorableto pursuing reforms towards adopting similar practices.
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