What is Drayage in Trucking? Your Complete Guide
In trucking, drayage refers to the short-distance transportation of freight, usually moving containers between ports, rail yards, and warehouses. This makes it a critical link connecting global shipping networks to local distribution centers, facilitating international trade.
Importers, exporters, retailers, carriers, and third-party logistics providers all rely on drayage to keep goods moving smoothly. For trucking companies, drayage offers the opportunity to expand into specialized freight markets with reliable customers who need consistent service.
In this article, we’ll explore the different types of drayage, common costs and fees, and how OTR Solutions helps drayage carriers manage cashflow and fuel expenses.
Key Takeaways
- Drayage means short-haul container trucking link in intermodal transport
- Common drayage trucks are used at ports and rail yards
- Costs include drayage fees, accessorial charges, and wait times
- Drayage services vary by type (expedited, inter-carrier, pier, shuttle, etc.)
- Carriers can benefit from factoring and fuel cards to offset drayage costs
What Does Drayage Mean in Trucking?
Drayage in trucking means moving cargo over a short distance, typically as part of a longer international or intermodal journey. The term comes from “dray,” which originally described horse-drawn carts used for short-haul deliveries in the 1800s.
In modern container shipping, drayage connects different transportation modes like ship, rail, and truck. When a cargo ship arrives at the Port of Los Angeles, drayage trucks move containers to nearby rail terminals for cross-country transport.
Key Characteristics of Drayage Trucking:
- Short-distance moves between terminals
- Part of longer intermodal journeys
- Strict appointment schedules at ports/rails
- Specialized chassis and equipment requirements
- Environmental compliance standards
What is a Drayage Truck?
A drayage truck is a specialized vehicle designed to haul intermodal containers between ports, rail ramps, and warehouses. These trucks are built specifically for short-distance, high-frequency movements that define drayage operations.
Most drayage trucks feature day cab configurations since drivers return home each night rather than taking long-haul trips. The trucks must meet strict environmental standards, especially in California, where ACF compliance and TRUCRS registration is mandatory.
Common Features of Drayage Trucks:
- Day cab setup for local operations
- Chassis used for container transport
- Port/rail compliance certifications
- Short-haul design optimized for frequent stops
6 Types of Drayage Services
Different types of drayage services handle specific parts of the intermodal transportation process. Each type has unique requirements and serves different customer needs in the supply chain.
1. Pier Drayage
Pier drayage moves containers directly from ships to nearby facilities like distribution centers or temporary storage yards. This is the most common type of drayage, handling the millions of containers that arrive at U.S. ports every year from international shipping routes.
2. Inter-Carrier Drayage
Inter-carrier drayage moves containers between different transportation companies, such as from a trucking company to a railroad or from one rail line to another. This type of drayage keeps freight moving when shipments need to transfer between carriers to reach their final destination.
3. Intra-Carrier Drayage
Intra-carrier drayage involves moving containers within the same company’s transportation network. For example, a railroad might use drayage to move containers between different rail yards within the same metropolitan area.
4. Shuttle Drayage
Shuttle drayage provides temporary storage solutions by moving containers to overflow yards when ports or terminals reach capacity. During busy seasons or when ships arrive ahead of schedule, shuttle drayage helps manage the flow of containers through congested facilities.
5. Expedited Drayage
Expedited drayage handles time-sensitive freight that needs to move quickly through the transportation network. This premium service comes with higher rates but ensures that critical shipments don’t get delayed in busy port or rail terminal operations.
6. Door-to-Door Drayage
Door-to-door drayage provides direct delivery from ports or rail terminals to the customer’s final destination. This service eliminates additional handling steps and gives shippers more control over their freight from the moment it leaves the transportation hub.
Intermodal Drayage Explained
Intermodal drayage connects shipping modes like ship, rail, and truck by transporting containers between terminals. This specialized service makes global trade possible by bridging the gap between massive container ships and local delivery networks.
The intermodal supply chain depends on drayage to function efficiently. A typical journey involves ocean transport from Asia to Los Angeles, drayage to a rail terminal, rail transport to Chicago, and final drayage delivery to a warehouse.
How Intermodal Drayage Works
Intermodal drayage involves several short but critical moves that connect ships, trucks, and trains. Here’s how it works:
- Container arrives at port via ship: International cargo containers are unloaded from vessels at major ports like Los Angeles, Long Beach, or Savannah
- Drayage truck moves container to rail terminal: Specialized drayage trucks transport containers from port facilities to nearby rail yards, typically within 50 miles
- Train carries container cross-country: Railroad companies like BNSF or Union Pacific move containers thousands of miles to inland destinations
- Final drayage move to destination: Another drayage truck picks up the container at the destination rail terminal and delivers it to the final warehouse or distribution center
- Cost-effective for long-distance freight: This combination of trucking and rail transport reduces costs compared to over-the-road trucking for shipments over 500 miles
Drayage Costs and Fees
Drayage cost refers to the charges for moving containers short distances, often including accessorial fees beyond the basic transportation rate.
| Fee Type | Description | Typical Cost |
|---|---|---|
| Per-container fee | Base cost charged per container moved | $300-$800 per container |
| Chassis rental | An extra fee if the carrier doesn’t own or supply their own chassis | $35-$75 per day |
| Wait time | Charged when drivers are delayed at ports or terminals (after 1-2 hours free time) | $60-$200 per hour |
| Demurrage | Penalties for leaving containers at a port beyond the allotted free time | $200+ per day (first 4 days) |
| Fuel surcharges | Variable charges tied to current fuel prices | 10-20% of the total cost |
| Classic Split Fees | When the chassis and container are in different locations | $150-$200 per occurrence |
Several factors impact drayage pricing, including fuel surcharges, port congestion, detention time, and chassis availability. During peak seasons or labor shortages, costs can increase significantly due to higher demand and longer wait times. Other accessorial charges, like lumper fees, can add to container handling costs.
Why Drayage Matters for Carriers
Drayage helps carriers expand their opportunities but comes with unique challenges that require careful financial planning. The port and rail markets offer consistent freight volumes and established customers, making drayage attractive for carriers looking to diversify services.
However, drayage operations face specific challenges that can impact profitability. Many moves require carriers to pay upfront costs for fuel, chassis rental, and port fees before getting paid by customers.
Drayage opportunities:
- Consistent freight volumes
- Established customer relationships
- Predictable routes and schedules
- Access to high-volume shipping markets
Common challenges:
- Port congestion and extended wait times
- Strict regulatory compliance requirements
- Fluctuating fees and accessorial charges
- Upfront operational expenses
Strong cashflow support becomes critical since carriers often wait weeks for payment while covering daily expenses. Freight factoring helps carriers handle upfront drayage expenses without delays.
Some carriers expand into related services like power-only trucking, which also relies on specialized equipment and customer relationships. Since drayage connects global ports and rail terminals, it’s also often the first area hit by supply chain disruptions, making reliable cashflow and relationships even more important to carriers participating in this type of hauling
Optimizing Drayage Operations with OTR Solutions
OTR Solutions serves as a reliable partner for managing drayage-related expenses through proven financial tools designed for trucking operations. Our services help drayage carriers maintain steady cashflow and control fuel costs, two critical factors for success in port and rail terminal work.
The OTR Fuel Card delivers significant savings at 2,500+ locations nationwide, with average savings of $0.50 per gallon and potential savings up to $2.25 per gallon. For drayage operations with predictable routes, these fuel savings improve profit margins on every load.
Key OTR Solutions benefits:
- True Non-Recourse Factoring eliminates collection risks
- Same-day funding on approved and processed invoices
- BOLT provides quick access to funds after invoice processing
- Fuel Finder for efficient route planning between terminals
- Lumper and fuel advances for upfront expenses
Streamline Your Drayage with OTR Solutions
Efficient drayage operations require reliable financial partners who understand the unique demands of port and rail terminal work. The combination of upfront expenses, variable wait times, and specialized equipment makes cashflow management critical for success.
Partnering with OTR Solutions provides the financial stability and fuel savings that help drayage carriers thrive in competitive markets. OTR’s True Non-Recourse Factoring program eliminates collection risks while delivering faster payments, and the OTR Fuel Card cuts operating costs on every fill-up.
Contact OTR Solutions today to learn more about our trucking solutions for drayage operations!
Frequently Asked Questions
What’s the difference between freight and drayage?
Freight refers to all types of cargo transportation, while drayage specifically means short-distance container moves between ports, rail terminals, and warehouses as part of intermodal shipping.
What is the difference between drayage and intermodal?
Drayage is the short-distance trucking component within intermodal transportation. Intermodal refers to the complete shipping process using multiple transportation modes like ships, trains, and trucks.
What are the benefits of drayage?
Drayage provides carriers with consistent freight opportunities, established customer relationships, predictable routes, and access to high-volume shipping markets centered around major ports and rail terminals.
Is cartage the same as drayage?
Cartage and drayage are similar terms for short-distance freight transport, but drayage specifically refers to container movement in intermodal transportation, while cartage can include any type of local freight delivery.
How long does drayage take?
Typical drayage moves take 2-8 hours, depending on distance, traffic, and wait times at terminals. Port congestion and appointment scheduling can extend these timeframes during busy periods.
Can small carriers make money in drayage trucking?
Yes, small carriers can succeed in drayage by focusing on reliable service, maintaining proper equipment, and managing cashflow effectively through tools like factoring and fuel cards to handle upfront operational costs.