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Logistics and Infrastructure: Challenges and Opportunities

Harry Caldwell
Federal Highway Administration
Office of Freight Management and Operations


Objectives


Challenges Placed on Infrastructure

Flowchart comparing shippers, transportation providers, and infrastructure providers


Logistics Productivity Factors


Logistics Expenditures and GDP

After a long improvement, expenditures have stalled at about 10%

Bar graph showing logistics expenditures as a percentage of PDG, comparing Administrative, Transportation, and Inventory between 1997 and 1998. Source: Cass/Pro Logis 10th Annual State of Logistics Report, 1998


Trade Outpacing Economic Growth

Far-flung supply chains lead to trade in components and parts.


Trucking Costs Have Dropped

Graph showing the decline in trucking costs since 1990.


Order Cycle Time Development

Graph showing information processing, physicial distribution, and manufacturing lead time increasing from 1980 to 1990


Inventories Are Shrinking

graph showing decrease in business inventory ratio to GDP between 1983 and 1997


Freight Trends and Issues: Themes

Presentation of trends and issues is organized around three sets of themes


Trends Shaping Demand for Transportation Services


From Push to Pull Logistics Systems

complex comparison of push to pull logistics systems


E-Commerce and Freight Movement

Shippers expect to use more parcel/express, LTL, local trucking, and /courier services

graph comparing E-Commerce and Freight Movement\


Modal Growth in Tonnage

Demand for reliable, high-speed service is growing

Bar graph showing annual modal growth , 1990 to 1998


Transportation Infrastructure is:

An Asset to contain costs and make products more competitive

Are we using it wisely?


Infrastructure Concerns add to delays and unnecessary costs

image showing days and miles for shipping goods


Top Gateways for International Freight Exports and imports in tons

Map of the USA showing top gateways for international freight.


Travel Rate Congestion Index

The average percentage growth in peak-period-travel-time compared to off-peak-travel-time in 68 large metro areas was 81%

graph showing increase in travel rate index between 1982 and 1997


System Mileage within the U.S.

Highway and air increased modestly; Class I rail lost mileage

bar graph comparing US system mileage increases between 1975 and 1996


NHS Intermodal Connectors -- Infrastructure Constraints

NHS Connectors


More Traffic on the Highways

Daily Vehicle Miles of Travel per Lane-Mile, 1987-1997

  1987 1997 Annual Rate of Change
Rural
Interstate 3,530 4,952 3.40%
Other Principal Arterials 2,090 2,522 1.90%
Urban
Interstate 11,230 13,696 2.00%
OtherFreeway 9,240 10,620 1.40%
Other Principal Arterials 5,010 5,768 1.40%

California Motor Carriers' Perception of Congestion and Response

Carriers are investing in technology to counter increasing congestion

bar graph comparing carrier use


Regional GNP Growth Rates to 2010

estimated regional gnp growth 1998 to 2010


Growth by Major Region and Mode

(Tons in Millions)

bar chart showing estimated growth, 1998 to 2020, by region and mode


Capacity and the Nation's Infrastructure

capacity and the nation's infrastructure


From System Construction to System Optimization


From Modal to Multi-Modal Surface Transportation Policy


Freight Transportation Perspectives

State and MPO focus is regional and local; private sector focus is increasingly national and global

State and MPO focus is regional and local; private sector focus is increasingly national and global


Why Identified Projects Go Unprogrammed


North American readiness...

The Challenge


There Is A Role for the Public Sector

There is a role for the public sector.


The Evolution of Freight Policy

Efficiency (ISTEA 1991-1997) to Equity (TEA-21 1998-2003) to Effectiveness, 2004
Intermodalism
Innovative Finance
Funding Increase
State/local freight focus
Information Technology
Infrastructure Funding
(multimodal?) Institutional Development

Future Challenges


Future Challenges - 3 I's


Logistics Challenges...Policy Responses

Updated: 04/01/2011
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