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Talking Freight Seminar Freight and Economic Development

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30 Port Terminals, 22 Rail Yards, Airport, Border Crossings ... Rail Delay. Road Delay. Airport Constraints. Airport Improvements ($9.1 million) ... – PowerPoint PPT presentation

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Title: Talking Freight Seminar Freight and Economic Development


1
Talking Freight Seminar Freight and Economic
Development
  • Glen Weisbrod
  • Economic Development Research Group, Inc.
  • 2 Oliver Street, 9th Floor
  • Boston, MA 02109 USA
  • www. edrgroup.com

2
Three Themes
  • Freight Flows changing due to National Global
    Economic Markets.
  • Economic Development depends on Market Access
    Competitiveness.
  • Infrastructure Investment directly affects Costs
    Competitiveness.

3
Freight Growing Faster than Pop.
Trends…
4
Changing Freight Patterns
Trends…
  • Higher value/weight
  • Higher time sensitivity
  • Overnight delivery
  • Small package delivery trucks
  • Air Marine port dependence on rail hwy
  • Rail truck companies focus on long-hauls

5
Economic Development…
Congestion Costs of Delay
  • Overnight Delivery Services earlier pickup
    deadlines, fewer deliveries per driver
  • Manufacturers overtime for handling deliveries
  • Concrete mixer trucks shrink delivery area
    (spoilage)

Shippers, Air/Water Ports, Rail miss delivery
deadlines or pad schedules
6
Competitiveness Productivity
Economic Development…
  • Effects on Business Location Growth…
  • Breadth of Suppliers Labor Inputs
  • Size of Customer Delivery Markets
  • Economies of Scale in Serving Markets
  • Transportation Choice Reliability, Modes

7
Urban Freight Limitation
Economic Development…
  • Higher Cost to Serve Markets
  • Reduced Schedule Reliability
  • Reduced Access Scale Economies

Reduced Opportunity for Attracting and Growing
Business …
Smaller Market Area can be served within
requirements for cost and service quality
8
Urban Econ Development…
Example Vancouver BC International Trade Gateway
9
Vancouver No Build Scenario
Urban Econ Development…
  • Ground Transport
  • Cars increase in travel expense (134
    million/yr)
  • Trucks raise shipper costs reduce business
    competitiveness attraction (280
    million/yr)
  • Rail capacity limitation businesses seek
    alternative routes at higher cost (1100
    railcars/day)
  • Ports
  • Marine ports higher cost, shift activity
    elsewhere
  • Airport raise costs for airport use

Diff Build vs. Not
10
Vancouver Economic Implications
Urban Econ Development…
  • Economic Value of Gateway
  • 30 Port Terminals, 22 Rail Yards, Airport,
    Border Crossings
  • On Site 75,000 jobs, W. Canada 145,000 jobs
  • Economic Impact of Constraint on Growth
  • 7,300 to 16,300 jobs
  • 475 million to 1.1 billion of GDP /year
  • Economic Stakes for Cost Competitiveness
  • Over 150,000 jobs in production industries
    produce over 30 billion of exports /yr that
    depend on Vancouver Gateway competitiveness

11
Urban Econ Development…
Vancouver…
To Trans Can Hwy ?
To US Border
12
Strategies for Port/Gateway Areas
Urban Economic Development…
  • Access Corridor
  • Los Angeles (Alameda Corridor)
  • Satellite Ports
  • NY Port Inland Distribution Network
  • Feeder System
  • Rotterdam (Inland Ports)

13
Example Chicago Rail Yards
Urban Econ Development…
  • 74 rail yards, 17 for intermodal (rail-truck)
  • delays at 600 grade crossings
  • congestion from 3200 daily truck trips
    transferring cargo from yard to yard
  • Abandoned under-utilized rail yards

14
Chicago Scenario Impacts
Urban Econ Development…
  • Scenarios (with without reuse of abandoned rail
    yards)
  • Base Case existing facilities, adjust over time
  • Shift Intermodal to Rim periphery of region
  • Rationalization Consolidate w/upgraded
    infrastructure
  • Minimal Rail Freight in City Intermodal moves to
    periphery loose-car business de-marketed
  • Bypass Chicago Reroute trains to bypass routes

15
NCHRP Study 8-42
Economic Development…
  • How Can We Use Rail Freight Solutions to Address
    Roadway Congestion
  • Converging interests of private sector transport
    carriers and public planning agencies
  • Reducing Congestion and Road/Rail conflicts that
    adversely affect business profits, public safety
    and economic development opportunities
  • Developing Framework for Decision-making

16
Rural Economic Development…
Rural Freight Limitations
  • Higher Trucking Cost due to deadheading
  • Lower Availability When Needed reliability
    reduced by vehicle shortages, delays
  • Higher Rail Cost full line cost for rail service
    to/from intermediate locations

Reduced Opportunity for Attracting and Growing
Business …
Smaller Market Area can be served within
requirements for cost and service quality Lower
Value Added of existing products
17
Example Appalachian Corridor T
Rural Economic Development…
NY-17, Now I-86, Southern Tier Expressway Mountain
Region of Southwest NY State, Near Pennsylvania
Line Area had been economically distressed and
losing jobs I-86 designation brought new freight
distribution, manufacturing, and traffic-serving
businesses.
FHWA Study compared it to a similar area with no
new highway connections
18
Rural Economic Development…
Highway Mfg Employment
Southern Tier West
N. Country Central
19
Example Janesville, WI
Rural Economic Development…
Regional automotive mfg cluster
  • Auto Mfg GM, Chrysler
  • Parts Mfg to S Carolina (BMW), Mexico Mich.
    (Ford), Ontario Missouri (Chrysler)
  • Reliance on just-in-time mfg, increasing needs
    for air and reliable truck movements
  • Current facilities cannot meet this need,
    reducing productivity and efficiency in mfg
  • Potential loss of jobs to Mexico or Canada

20
WisDOT Multi-Modal Freight Access
Rural Economic Development…
Rail Delay
Road Delay
Airport Constraints
  • Airport Improvements (9.1 million)
  • Highway Access Rail Crossing Improvements
    (13.5 million)

21
ARC Export Transportation Study
Rural Economic Development…
  • Overseas Exports are Intermodal
  • Truck to Air
  • Rail or Truck to Sea

22
Rural Economic Development…
Appalachian Development Highways
  • Serve historically isolated areas improve access
  • Link to major markets and trade routes
  • Motivated by econ development

23
ARC Export Export Study
Rural Economic Development…
Auto Parts, Upholstered Furniture
Food Processing Machinery
New York
Michigan
Maryland
Texas
Florida
24
ARC Study Findings
Rural Economic Development…
  • There are limited E-W freeways, rail lines
    inter-modal connections across Appalachia,
    raising costs constraining export
    opportunities.
  • States in eastern side export more to Europe
    because of easier access to east coast ports.
  • States in the western side export more within
    North America because of better access to
    industrial parts of Canada and Mexico.

25
Conclusions…
Freight Connections Alone Do Not Cause Economic
Development
…business growth attraction depends on
connections to markets, not just presence of a
highway…
ARC Guide help planners identify opportunities
related to new highways, and actions needed to
pursue them.
26
But Failure to Provide Freight Access Constrains
Economic Development
Conclusions…
  • Lost opportunity for economic growth, good-paying
    jobs,
  • new jobs for next generation.
  • Potential Benefits of Infrastructure Investment…
  • Opportunity for success is not lost.

27
…On the Web
FHWA Economic Development Studies (incl. I-86)
www.fhwa.dot.gov/planning/econdev Vancouv
er Freight Gateway Study http//www.edrgroup.com/
pages/n32.html North Country Transportation
Studies www.danc.org/ncts Chicago
Rail Freight Study www.edrgroup.com/pages/n25.htm
l ARC Guide to Economic Opportunities from
Highways www.edrgroup.com/pages/n11.html
Library of Economic Impact Studies
www.edrgroup.com
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