Tracking a Future for US Project Cargo

By Amy McLellan

With highways strained and construction booming in the U.S., is the nation’s freight train network finally ready to shoulder more of the oversized cargo market?

From Issue 5, 2025 of Breakbulk Magazine.

(6-minute read)

Faced with a construction boom and deteriorating highways, project cargo specialists in the United States are reconsidering their reliance on trucks. Advances in AI, major rail mergers and growing demand for sustainable transport suggest the nation’s freight railroads may finally be ready to shoulder more of the oversized cargo market.

Today, most heavy and oversized shipments still move by road, an iconic but increasingly strained industry. Trucking offers flexibility but also brings complex permitting and aging infrastructure, with 39% of major U.S. roads rated in poor or mediocre condition. Rail, by contrast, remains underused, despite its scale and potential.

The U.S. freight rail network stretches nearly 140,000 route miles, the largest in the world, and moves about 1.5 billion tons of goods each year. Yet for project cargo, rail is too often overlooked. Inefficiencies across the system can translate into unpredictable transit times, adding cost and complexity that discourage shippers from using it.

Now, a convergence of trends means rail could be poised to win over project cargo shippers and convert truck miles to the railroads. These trends include the deployment of AI solutions to streamline operations and improve efficiency across the network and the sustainability agenda, which may be politically out of favor right now but remains firmly embedded in many corporates’ investment plans. On this, rail has a significant advantage over road as moving freight by rail instead of truck is calculated to reduce emissions by 75%.

The shift comes as the U.S. undertakes a massive wave of construction to deliver the abundant energy and grid resilience required to support the electric vehicles, AI data centers and homegrown manufacturing that are fundamental to President Trump’s agenda. This creates opportunities for rail operators to capture more of the project cargo market and play their part in delivering this vision.

“Rail is one of the vital partners of America’s energy future,” says Kathleen Smith, vice president of industrial products at Norfolk Southern, one of the nation’s seven Class I railroads, serving the Eastern United States. “Many of the components that power grids, whether transformers, steel structures or wind turbines, are oversized, overweight and often irreplaceable. Rail provides a safe, economical and sustainable way to move these shipments from factories to job sites.”

Marco Poisler, chief operating officer at UTC Overseas, agrees. “When it comes to moving transformers, power generation equipment and wind blades, rail is critical,” he says.

Greg McComas, senior manager, dimensional clearances at BNSF, which operates one of the largest rail networks in North America, sees real opportunities to increase their project cargo business by targeting power generation and transmission utilities, data centers, manufacturing plants (brownfield and greenfield) and the renewable energy industries. Solar panels and large battery packs, he adds, are good candidates for rail, even though they are not typically shipped that way today.

Turning Inconvenience Into Opportunity

Rail has some way to go to win additional project cargo work, however, with inefficiencies in the network adding complexity, delay and cost. It doesn’t help that some railroads see oversized or special loads as a “necessary evil” to be accommodated.

“Railroads have schedules for the large volume shippers and oversize cargoes risk disrupting those deliveries, so specialized cargo takes less of a priority,” says Poisler.

“From a financial perspective, the rail companies see specialized cargo as a necessary evil. They don’t see it as a money maker, instead it’s seen as a disruption to their revenue streams. But we work with great people in the industry, and we see that rail is critical, as well as a revenue generating opportunity for these rail companies.”

This was echoed by McComas at BNSF who points out that, from the rail operators’ perspective, the ideal project cargoes are those that can be absorbed into the normal service design plan.

“If project cargoes can flow in our standard lanes, customers will enjoy better rates, timing and predictability,” says McComas. “We do our core freight traffic well and that has become a reliable component for our shippers.”

Project cargo that requires special handling, however, adds in complexity and cost as rail operators may need to undertake track improvements, introduce specialized cars or follow slow orders. For these projects, McComas advises shippers to aim for scale by bundling as many components together as possible to reduce the negative impact on the core network and to plan early for special adjustments.

“The key is to identify any/ all required items, such as track improvements and special switch needs, early in the vetting process so that it is a known cost and scheduled accordingly,” says McComas.

Sometimes the size and weight of an item may require a dedicated special train, but this can be difficult to organize within the context of a rail network, not just in terms of pulling the asset from one location to another but also crew qualifications and availability. Rail car availability can be another limiting factor.

“When it comes to rail car capacity, it’s not always about the number of cars,” says Dan Labyak, senior director of military clearance at CSX. “It can be about efficiency, and turning the cars faster so we load, deliver, offload and put that car back into service. That helps reduce the need for more rail cars.

This has been a major driver at CSX, to focus on shifting high wide cargo through our network as quickly as possible to turn the asset.” This was recently demonstrated when CSX recently completed its largest rail operation in 17 years, when it partnered with the Florida National Guard to transport more than 1,000 pieces of military equipment in a historic deployment.

While permitting can be complex, rail does have an edge over trucking. “Moving these oversized cargos by truck may need permits for eight to ten states, and each state needs its own application,” explains Poisler. “But with rail, the starting carrier will start the permitting and they will then have the clearance over all the states. That’s a tremendous advantage in terms of efficiency. For anything over 200,000 pounds, we encourage our clients to look at rail because cost-wise it’s competitive and permitting can be expedited.”

That capability is underscored by McComas, who points to the assets and approvals needed to move the heaviest loads. “We have the asset class to handle extremely heavy loads with self-contained governance and approvals for weight approvals. We own our own infrastructure, so bridge/clearance approvals are all done fully in-house.”

But for rail to take on more of the heavy lifting of the current construction boom, there’s a need to improve efficiencies and invest in the lines and associated infrastructure, such as installing rail sidings near substations, targeted clearance of obstructions along the route and collaboration with government agencies to upgrade bridges.

“Rail can be a hard sell to clients because the transit time is uncertain. Unpredictability costs money,” says Poisler.

Mergers Reshape the Rail Map

Consolidation is expected to deliver some of the sought-after efficiencies. In late August, BNSF and CSX announced a new partnership to expand coast-to-coast intermodal service. The collaboration adds direct lanes linking Southern California with Southeast hubs such as Charlotte, Jacksonville and Atlanta, designed to convert more highway freight to rail.

It also introduces new port-to-inland connections, moving containers arriving at East Coast gateways including New York/ New Jersey and Norfolk directly to Kansas City. Together, these services extend network reach across Western and Eastern U.S. markets, offering greater efficiency, flexibility and reliability for shippers.

This came hot on the heels of the announcement that two of the biggest names in rail, Union Pacific and Norfolk Southern, were set to merge, a combination that could reshape the North American freight landscape. Both companies have long pedigrees: Norfolk Southern traces its roots to 1827 and serves vital East Coast ports and inland markets while Union Pacific was incorporated on July 1, 1862 and dominates the western U.S. rail network.

Union Pacific CEO Jim Vena called the deal “transformational” for the U.S. supply chain, pointing to its scale and potential to improve efficiency. The combination will create the first coast-to-coast U.S. railroad network, stretching 50,000 miles and spanning 43 states to connect nearly 100 seaports and freight corridors across the entire continent. This should eliminate interchange delays between railroads, streamline operations, and significantly reduce transit times, helping to address some of the barriers to shifting breakbulk and heavy-lift cargo via rail.

Indeed, it’s hard to overstate how much impact reduced handovers (from one rail network to another) will have on reliability and predictability. There are currently around one million carloads where there are handoffs at interchanges between the two companies, creating friction points in the cargo journey.

As a result of the merger, it is expected that those million carloads will immediately see a 24- to 48-hour improvement in their transit time, which means reduced costs for customers and less congestion on the railroad.

Technology Clearing the Way

Technology is helping to identify potential obstacles across complex routes to ensure oversized freight moves safely and efficiently. When Norfolk Southern, for example, delivered nearly 160 massive wind turbine components to the Timbermill Wind renewable energy project in North Carolina, it deployed LIDAR (Light Detection and Ranging) scans across multiple states.

LIDAR scans identified potential obstacles along a route that spanned 10 states, ending in Morehead City, where trains ran down the center of a four-lane highway. City crews removed signs and coordinated traffic to guide components the size of buildings to the port. High capacity, purpose-built cars were used to move blades that are longer than city blocks with towers weighing as much as a house.

Such projects aren’t just technology-led, however. Coordination and collaboration are critical when it comes to oversized loads. For Timbermill Wind, Norfolk Southern worked closely with various short line partners for the final delivery leg, requiring synchronized operations, specialized crews and real-time tracking. “Early collaboration with project developers and connecting carriers ensures that handoffs are smooth, and timelines are met,” says Smith at Norfolk Southern.

AI is also making a real impact. “Automation is critical to unlock efficiencies,” says Poisler. “The irony is that AI is the same kind of transformative innovation that the railroads themselves represented 150 years ago. Right now there’s a bottleneck and part of the solution is getting rail moving to build the data centers and power that AI needs.”

AI and automation are “game changers” for rail freight, says Smith, helping model train performance, optimize routes and anticipate maintenance to keep critical cargo on schedule.

AI can also boost network-level efficiency by predicting congestion, balancing crew and equipment availability, and improving fuel use. However, she added: “What cannot be overstated is the human element that brings technology, determination and planning together to deliver results for our customers.”

Automation can help by streamlining operations and freeing up personnel. Union Pacific, for example, has been piloting semi-autonomous crew repositioning in its yards.

The future of project cargo shipments in the U.S. may depend on how quickly railroads can shed inefficiencies and embrace technology while making specialized loads a higher priority. With major mergers eliminating handoff delays, AI streamlining operations and a national push for new energy and infrastructure, the opportunity is clear.

For project cargo specialists, there’s the potential to tap into streamlined cargo lanes that can deliver oversized loads safely, reliably and sustainably. And if the rail industry can rise to the challenge, it won’t just ease pressure on the nation’s highways, it will cement rail’s role as a backbone of the country’s industrial resurgence.

The deployment of real-world digital tools in breakbulk logistics will be a main talking point in a panel session at Breakbulk Americas 2025. “Real Technologies Solving Breakbulk’s Biggest Bottlenecks” will take place on the main stage on Wednesday, Oct. 1 from 3:30pm-4:00pm.

Top photo: Union Pacific
Second: Norfolk Southern