goods movement - narcnarc.org/uploads/file/transportation/freight summit/ihkrata_ports.pdf ·...
TRANSCRIPT
Goods MovementChallenges. Opportunities. Solutions
Goods MovementChallenges. Opportunities. Solutions
Hasan Ikhrata –Director of Planning & Policy Southern California Association of Governments
The Regional Planning Agencyfor Southern California
The Regional Planning Agencyfor Southern California
15th largest economyin the world
15th largest economyin the world
Shares the characteristics of many nations
Shares the characteristics of many nations
Experiencing Explosive GrowthExperiencing Explosive GrowthPopulation is expected to grow by more than
over the next two decades to 23 million
38%more than
today
6,000,000
9,000 lane miles of freeway9,000 lane miles of freeway
Long BeachSan Pedro
Hueneme
Nation’sGlobal Gateway for TradeNation’sGlobal Gateway for Trade
Four major airportsFour major airports
Ports handle one third of all container traffic in U.S. and nearly two-thirds of containers from Asia
Over 70% of imports pass through to other markets
9.5 13.2
18.3
36.0
42.5
Revised Est.
44% US Import Market Share
25% US Export Market Share
1999 2005 2010 2020 2030
6.99.0
12.3
23.4
Original Estimate
In Million TEU’s
Source: POLA, POLB
Total LA/Long Beach Container GrowthProjected to Triple in 25 Years
Total LA/Long Beach Container GrowthProjected to Triple in 25 Years
25.2
What Does the Logistics Infrastructure and Work
Force in the Region Offer Shippers That Other Destinations Don’t?
What Does the Logistics Infrastructure and Work
Force in the Region Offer Shippers That Other Destinations Don’t?
Exactly What Shippers WantExactly What Shippers Want
Goods Made in AsiaShipped in ContainersUnloaded at our PortsTransported on TrainsAnd by TrucksTo Distribution CentersTo Arrive at Retailers“Just In Time”
Highway CongestionHighway Congestion
Worst in nation since 19822000 2010 20252020
10%
20%30%
40%50%
60%70%
80%
Projected Growth
population
auto travel
truck travel
Rail CongestionRail Congestion
Source: SCAG Los Angeles - Inland Empire Railroad Mainline Advanced Planning Study
YearFreight Trains
per Day
2000
2010
2025
112
165
250
123% Increase
Estimated Risk of Cancer from Airborne Toxics: Excluding Diesel
Estimated Risk of Cancer from Airborne Toxics: Excluding Diesel
Source: SCAQMD, Multiple Air Toxics Exposure Study II, March 2000
Cancersper million
100-200
200-300
300-400
400-600
600-800
Source: SCAQMD, Multiple Air Toxics Exposure Study II, March 2000
Cancers per million200-300
300- 400400-600
600-800
800-1000
1000-1200 Over1200
Estimated Risk of Cancer from Airborne Toxics: Including Diesel
Estimated Risk of Cancer from Airborne Toxics: Including Diesel
Build Dedicated Truckway SystemBuild Dedicated Truckway System
I - 71018.0
miles
East/West37.8
miles
I - 1586.0
miles
2 Lanes inEach Direction
Hobart
LATC
E. LA
Fullerton
Atwood
Pomona
Riverside
Colton
East-West Corridor
Alameda Corridor
184 center-trackmiles, 390 daily trains by 2025
Barstow
Indio
Future Improvements
Improve Rail CapacityImprove Rail Capacity
The CostThe Cost
Dedicated Truck Lanes
Additional Rail Tracks
$20.2 Billion$6.0 Billion
$36.2 Billion$36.2 Billion
Environmental Mitigation $10.0 Billion
Can some of the new infrastructure be
financed with user fees?
Can some of the new infrastructure be
financed with user fees?
At what point would fees
and tolls used to finance
infrastructure divert
business elsewhere?
At what point would fees
and tolls used to finance
infrastructure divert
business elsewhere?
LA/LB
Dr. Robert C. LeachmanU. C. Berkeley
Leachman & Assoc. LLC
A Study to determine port
demand elasticity
September 2005
The Elasticity StudyThe Elasticity Study• Interviewed
– Importers– Steamship Lines– Port Terminal Operators– Railroads and Trucking companies– Logistics companies
• Analyzed current:– trade flows and steamship services– steamship, rail and dray rates– labor and management practices at ports– third party logistics operations
Study Conducted by Leachman and Associates LLC, September 2005
Most Cargo Coming to LA/LB Ports Passes Through to Other Markets
Most Cargo Coming to LA/LB Ports Passes Through to Other Markets
Los AngelesLong Beach
Locally consumed or
produced23%
Discretionary77%
(52% transloaded)
Deep Harbors and Landside Facilities Make LA/Long Beach the Preferred Destination
Deep Harbors and Landside Facilities Make LA/Long Beach the Preferred Destination
Vancouver, BCSeattle
Tacoma
Oakland
Los AngelesLong Beach
Houston
SavannahCharleston
Norfolk
NY/NJBrunswick
Post-Panamax ships are TOO LARGE to transit the
Panama Canal
Can’t accommodatepost-Panamax ships
Limited landside intermodal capacity
The Study AnalysisThe Study Analysis
• Distributed volume for 102 major importers among all regions proportional to their purchasing power
• Allocated import volumes among ports and modes as to minimize total transportation and inventory costsfor each importer
Study Conducted by Leachman and Associates LLC, September 2005
At what price point would using the
LA/Long Beach ports stop making sense?
At what price point would using the
LA/Long Beach ports stop making sense?
Study Conducted by Leachman and Associates LLC - Sept. 2005
If Fees on 40-foot Containers Were Applied….
If Fees on 40-foot Containers Were Applied….
Fees Imposed with NoInfrastructure Improvements
Fees Imposed with NoInfrastructure ImprovementsFEUs in
millions
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2004
Ann
ual V
olum
e
$30 60 90 120 150 180 210 240 270 300 330 360 390 420 450 480Container Fee (per FEU) in dollars
Total Volume
Trans Loading Volume
Fairly inelastic until fees in the $180 range
are introduced
Much more inelastic than
direct shipping
Container Fees Used to Finance Congestion Relief
Container Fees Used to Finance Congestion ReliefFEUs in
millions
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2004
Ann
ual V
olum
e
$30 60 90 120 150 180 210 240 270 300 330 360 390 420 450 480Container Fee (per FEU) in dollars
Total Volume
Trans Loading Volume
Congestion relief makes ports more attractive
At $200, volume is only 4.3% below No Fee:No Improvement Scenario
Trans-load volume is even higher
Estimated Private SectorLevel of Investment
Estimated Private SectorLevel of Investment
Dedicated Truck Lanes
Additional Rail Tracks
$60 - $70 per FEUplus $0.86 per mile
Total with Environmental
Mitigation ($10B)
Total Highway & Rail System
$15 - $30 per FEU
$120 - $130 per FEUplus $0.86 per mile
$160 - $170 per FEUplus $0.86 per mile
Investment Levels Fall Within Study Parameters for Acceptable Rate of Return
What are speed and reliability worth to
users of the system?
What are speed and reliability worth to
users of the system?
The Value of TimeThe Value of Time
$25 to $200 per hour depending on cargo
Trucking Industry Value of
time
FHWA Freight Management and Operations: Measuring Travel Time in Freight-Significant Corridors, www.ops.dot.gov/freight/time.htm
Travel Time In the Year 2030Travel Time In the Year 2030AM Peak Travel Planning Time* in Hours
Hours:
LA Business District
Ontario Victorville
2.0 4.7 7.6
*
% more time
Tim
e of
Day
(non
-hol
iday
wee
kday
s)
9 PM
5 AM6 AM7 AM
12 PM1 PM
5 PM6 PM7 PM
8 AM9 AM
10 AM11 AM
2 PM3 PM4 PM
8 PM
10 PM10 20 30 40 50 60 70 80 90 100 110
Buffer Time to ensure on-time arrival for most trips
Travel Time
Mobility Monitoring Program Texas Transportation Institute. FHA
Planning Time in 2030 Index by Time-of-Day
Planning Time in 2030 Index by Time-of-Day
In the Year 2030 with Truck LanesIn the Year 2030 with Truck LanesAM Peak Travel Planning Time in Hours
Hours:
LA Business District
Ontario Victorville
.5 1.5 4.8
Cash Value of Time Savingswith Truck Lanes
Cash Value of Time Savingswith Truck Lanes
AM Peak Travel @$73 per hour
Value:
LA Business District
Ontario Victorville
$103 $232 $305
Extra Trip
Potential 3.4 3.1 2.3
Railroads Will Receive Great Benefits from Capacity Improvements
Railroads Will Receive Great Benefits from Capacity Improvements
Hours SavedEn Route
Colton Crossing
*
BNSF Railway
Union Pacific
2.9
3.1
Percent Faster
59%
65%
Hours SavedIn Delay
2.9
3.0
Percent Reduction
86%
93%
BNSF RailwayUnion Pacific
2010Baseline
206197
2025 With Improvements
3014
Percent Reduction
86%93%
HoursSaved
2.93.0
Minutes Delay Per TrainMinutesSaved
177183
BNSF RailwayUnion Pacific
300285
2025 With Improvements
12499
Percent Faster
59%65%
HoursSaved
2.93.1
MinutesSaved
176186
Flow Time Per Train
Note: Without improvements nothing will be moving in 2025
Leachman & Associates LLC
2010Baseline
From Ports to Colton Crossing
Time Saved with Rail Capacity Improvements
Time Saved with Rail Capacity Improvements
1. The LA/LB ports offer shippers a competitive advantage
Quick SummaryQuick Summary
2. Transportation infrastructure improvements would offer rail, truck, and shipping companies significant cost and time savings
Path to Prosperity:The Right Kind of Jobs
Path to Prosperity:The Right Kind of Jobs
Southern California Based
Blue Collar
Good Entry Level Pay
Defined Skill Ladder
On the Job Learning
Tech Dependent
Logistics JobsLogistics Jobs
Wholesale TradeTruck Transportation
Transportation SupportCouriers
General WarehousingAir Transportation
Rail TransportationWater Transportation
In 2003 352,37354,50452,66230,09028,44225,4662,9521,789
548,278Source: Quarterly Census of Employment Wages, CA EDD, 2004
Total
Share of SCAG JobsShare of SCAG Jobs
0%
2%
4%
6%
8%
10%
12%
14%
16%% SCAG Jobs
Leisure and
Hosp.
9.6
Other Services
3.5
Educ. & Health
Services
10.6
Constr.
4.8
Prof. & Bus.
Services
14.1
Manf.
12.1
Logis-tics
8.1
Gov’t.
14.9
Financial Activities
7.5
Motion Picture
1.7
1 out of 12 jobs in 2003
Logistics PayLogistics Pay
Rail TransportationAir Transportation
Transportation Support Wholesale Trade
Water Transportation General WarehousingTruck Transportation
Couriers
In 2003 $55,344$51,655$49,829$46,892$40,988$37,938$37,449$34,049
Source: Quarterly Census of Employment Wages, CA EDD, 2004
$45,314 Weighted AverageTotal
Annual
Compared to Other SectorsCompared to Other Sectors
Average weekly pay for all industries is $749
0$
$200
$400
$600
$800
$1000
$1200
$1400
$1600$ Weekly Pay
Leisure and
Hospitality
$400
Other Services
$413
Educ. & Health
Services
$718
Constr.
$777
Prof. & Bus.
Services
$811
Manf.
$843
Logistics
$847
Gov’t.
$866
Financial Activities
$1194
Motion Picture
$1353
1 of highest paying
What Do We Need?What Do We Need?
Federal Involvement and Support
Private Sector Leadership
Political Leadership