Intermodal competition is more intense than Intramodal competition for water carriers because it handle proper standardised containers to ship out cargo on trucks, trains and ships. These containers are usually large rectangular boxes, which can be safely secured to special trailers. As such, it is more economical in terms of cost, speed, accessibility, frequency, safety, etc.
The containers are strong, constructed of steel and built so that they can be transferred between the different modes of transportation.The concept of intermodal transportation has begun since back in the 18th century some of the earliest containers were those used for shipping in England in the 1780s. The bookends of intermodal tend to be rail and ocean segments; in between shipment trucking is frequently used to connect them. The vechicle that runs between sea ports, rail, and inland shipping docks is usually provided by dedicated companies.
To cope with an intense and competitive environment, intermodal freight transport operators have increasingly adopted business practices —like horizontal and vertical business integration—which aim to reduce the operational costs, increase the profit margins, and improve their competitive position in the market. These strategies and business practices could potentially affect the competition level in the IFT market by increasing the market concentration. The impact can be on the separate submarkets (e.g.
, transhipment market or main-haulage market) or the whole market for IFT services at the network level.While Intramodal is the movement of cargo from origin to destination by several modes of transport where each of these modes have a different transport provider or individual responsible, each with its own contract. Multiple carriers contracted to fulfil a single journey. The rates of goods to be lost, mishandling etc. is higher. Water carriers actively compete for traffic with other modes and, with other water carriers.
The small number of water carriers results in a limited intensity of competition. Because the number of carriers on a given waterway is limited, there is little stimulus for the water carriers to compete with one another by lowering rates because they realize that the rate decrease will most likely be matched.