Circle Logistics’ Nicholas Shipe tells FreightWaves why a lower rail rate doesn’t always beat truckload
FORT WAYNE, Ind., July 22, 2026 — Nicholas Shipe joined FreightWaves’ live “FW Today” broadcast this week. He’s Director of Premium Transportation at Circle Logistics (“Circle”), one of the fastest-growing third-party logistics providers in North America. Shipe explained why shippers haven’t rushed to intermodal, even as truckload spot rates have climbed well above rail rates.
The Rate Sheet Doesn’t Tell the Whole Story
FreightWaves asked Shipe why shippers aren’t switching en masse, given the widening rate spread. Shipe said the comparison can’t start and end with the rate sheet. “It’s always going to be transportation spend. That always seems to be the key indicator of what can we have as whether we do it over-the-road or if we’re going to put it on rail,” Shipe said. “But in that fashion, we can’t also just judge the cost for the rail versus the cost for the truck, because there is obviously an abundance of other things that go into it — whether it’s availability that’s going to be on the rail, whether it’s the drayage cost, the downtimes. There’s a multitude of costs that go in addition to rail versus a truckload than what just that dollar sign can look at.”
The Downtime Math Decides the Mode
Shipe said downtime cost, not the rate sheet, actually decides the mode on plant-critical freight. “If it’s stuck on the rail for 5 or 6 days and I needed the container 3 to 4 days before that, is operating at a higher transportation spend on a rate-per-mile per truck more important to us than the tens of thousands of dollars it might cost for them to have downtime at the plant?” he said.
Rail Car Availability Pushes Freight Back to Truck
Rail car and tank car availability reinforce that calculus, Shipe said. Circle has watched shippers pull freight off rail and back onto truck simply because equipment wasn’t there when they needed it. “We had a lot of our shippers that were actually converting typical loads that do go onto the rail because of, whether it’s just a cost, whether it’s keeping the product heated, whether it’s a few other things, that just because of rail car availability, that they did have to make that shift, and we still continue to see that to this day,” Shipe said. He added that this hits chemical and oil freight especially hard. Product has to be ready in time to hit the rail car. It isn’t always fungible if it runs late.
What Chemical Shippers Often Miss
Circle’s premium transportation team moves commercial and transformer oils, additives, chemicals, and wastewater for its chemical and oil customers. It also handles Circle’s automotive expedited freight. Shipe said most shippers underestimate the pickup-and-delivery details, not the mode decision itself. “Our biggest thing is we never want to delay production, whether that’s production that’s at the shipper and we have the right type of washes or the right type of equipment to load, to in-transit and making sure that the product is kept in a safe condition manner for those tanks,” he said. Circle would rather keep its own equipment waiting on a receiver, he added. That beats forcing a shipper’s production line to wait on a truck.