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Walmart Transfers Intermodal Assets to J.B. Hunt in Strategic Move

by Zyrene D.
03/03/2024
in Industry, Logistics & Transportation

Walmart has completed the sale of its intermodal assets to J.B. Hunt Transport Services, although the specifics of the deal, including its duration and the exact number of assets transferred, have not been publicly disclosed by either company.

Industry experts, including Jason Hilsenbeck, president of LoadMatch and Drayage.com, interpret the transaction as a strategic decision by Walmart to optimize its logistics and reduce operating costs. The rationale behind Walmart’s decision appears to stem from a reassessment of its fleet management strategy, particularly the challenges and costs associated with maintaining a private intermodal fleet.

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Hilsenbeck shared insights suggesting that Walmart’s expertise in managing its own over-the-road (OTR) trailer fleet and drivers may not fully translate to the intricacies of intermodal logistics, which involves the transportation of goods in an intermodal container using multiple modes of transportation without any handling of the freight itself when changing modes.

The sale is expected to significantly bolster J.B. Hunt’s intermodal fleet. Estimates suggest an increase of approximately 15,500 containers for J.B. Hunt, aligning with the company’s strategic goal to expand its intermodal fleet to 150,000 containers by the period between 2025 and 2027. As of the end of the fourth quarter, J.B. Hunt reported owning 118,171 containers.

This agreement is announced amidst a period of intermodal volume growth for J.B. Hunt, as reported in their latest quarterly earnings. Although the company’s executives have expressed uncertainty about the sustainability of this growth trend into 2024, there remains a strong commitment to the expansion of the intermodal segment.

Shelley Simpson, President and incoming CEO of J.B. Hunt, emphasized on an earnings call the company’s strategy of leveraging intermodal transportation to offer more cost-effective and environmentally friendly logistics solutions to customers, highlighting the benefits of converting over-the-road shipments to intermodal methods.

Find the latest updates in supply chain logistics news at The Supply Chain Report. Visit ADAMftd.com for free international trade tools.

#LogisticsNews #SupplyChainNews #GreenLogisticsNews #WalmartJBHuntNews #FleetManagementNews

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