Impact of Regulation Deregulation on Intermodal Transportation Case Study

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Intermodal Transportation

Intermodal transportation in Europe and the United States has experienced tremendous growth and expansion over the years. One of the major factors that have impacted the growth of intermodal transportation is regulation/deregulation of the industry. The regulation and deregulation of intermodal transportation in Europe and the United States started in the late 19th Century at a time when the industry had relatively no competition from other transportation modes. The regulation and deregulation of the industry can be traced back to 1887 when the Interstate Commerce Commission was established as a regulatory board to handle various issues relating to intermodal transportation (Slack, n.d.). Since then, regulation and deregulation has had both positive and negative impacts on the growth and/or continued growth of intermodal transportation in Europe and the United States.

Impact of Regulation/Deregulation on Intermodal Transportation

As previously indicated, the regulation/deregulation of intermodal transportation has had positive and negative impacts on the growth and continued growth of this sector. Given its positive impacts, deregulation is a good example of how policy changes significantly affect the structure and economic health of an industry (Slack, n.d.).

Positive Impacts of Deregulation

One of the positive impacts of deregulation on the growth and continued growth of intermodal transportation is enhancing competition. Deregulation of intermodal transportation has played a crucial role in enhancing competition in pricing and enhancing the competitive of certain transportation sectors.

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According to the Bureau of Transportation Statistics (n.d.), deregulation of the motor carrier, rail, aviation, and maritime shipping industries in the past few decades has contributed to the emergence of new competitors. The deregulation has also promoted the development of an environment that is characterized by innovative, affordable, and efficient transportation services. This has in turn increased the numbers of passengers and volumes of freight, which enhances the growth of intermodal transportation (Bureau of Transportation Statistics, n.d.). For instance, in the United States, policy changes in transportation and logistics, especially changes in the policy framework of the trucking industry, enhanced the competitiveness of this industry vis-à-vis other modes of transportation. Through deregulation with the 1980 Motor Carrier Act, the trucking industry in the United States experienced the emergence of new trucking companies, which was an indicator of the increased competition in this sector. As new companies emerge and competition intensified, the trucking industry experienced tremendous growth.

Secondly, deregulation contributed to a reduction of operating costs in intermodal transportation, which played a crucial role in the growth and continued growth of the….....

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