Planning for Urban Freight Movement

1
Planning for Urban Freight Movement

• Talking Freight Series
• Susie Lahsene
• Port of Portland

2
Trends Affecting Urban Freight

• Globalization
• Transportation deregulation
• Business Practices
• Logistics/Supply chain mgmt
• Warehouse/distribution development
• Industry/carrier mergers
• Urban development
• Markets
• Economic base
• Urban land use
• Transport planning/investment

3
Globalization

• Markets around the globe-products moving longer
  distances with more frequency
• Freight mobility pressure added to urban
  environment- the site of ports and transport
  connections to reach other markets

4
Federal Transportation Deregulation

• Aviation Deregulation of 1978
• Motor Carrier Act of 1980
• Staggers Rail Act of 1980
• Ocean Shipping Act of 1984
• Ocean Shipping Reform Act of 1998

5
U.S. Trade Increasing
Source U.S. Department of Commerce and U.S.
Bureau of Economic Analysis, 2003
6
Freight Tonnage Increases by 2020
Central Region89
Northeast Region79
West Region100
South Region89
Source FHWA Freight Analysis Framework Project
Reebie Associates 1998 data (1st
Approximation)WEFA economic data and forecasts
7
Business PracticesHistory of Industrial
Competitiveness
1800s Firms stressed ability to decrease cost of
production of each unit
Early 1900s As production started to catch up
with demand, businesses recognized the importance
of sales
Late 1900s 2000 Sophistication of product
offerings, globalization and increased customer
expectations make logistics key to companies,
regions competitiveness
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Distribution Logistics The New Business Model

• The use of the transportation system, information
  technology, and distribution facilities to
  assemble and move raw materials and products to
  regional, national and international markets
• Why ?
• Increased competition for global markets
• Increasing offshore production and movement of
  parts and goods
• Business cost savings already realized through
  production efficiency
• Supply chain management offers opportunity for
  additional cost savings

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Columbia Sportswear
1

• 1. Inbound Movement
• Apparel, footwear, and accessories arrive via
  ship from Asia at T-6, transported by truck to
  the Rivergate DC some move through Seattle and
  Tacoma.
• Air shipments arrive both at PDX and Sea-Tac.
• Ocean/air shipments arriving in Puget Sound
  transported by truck to Rivergate.

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2

• 2. Value Added Services
• Ocean containers unstuffed airfreight unpacked.
  Products sorted/stored by SKU.
• Once all SKUs for a customer's order arrive,
  shipment packed for delivery.
• Customers provide routing instructions shipments
  prepared for truck or air shipment accordingly.
• The Rivergate DC also handles returns.

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3

• 3. Reload Facility
• Freight forwarders transport shipments by truck
  to reload facility for air shipment.
• LTL carriers take shipments by truck from DC to
  the LTLs local hubs in Portland for
  consolidation with other loads to same cities.

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4

• 4. Outbound Movement
• All three product lines (apparel, footwear, and
  accessories) shipped out by air or truck.
• Air cargo shipped out of PDX primarily using
  integrated carriers (such as FedEx, UPS, Emery,
  etc.) for domestic delivery.
• Once consolidated, LTL shipments move through
  carriers hub and spoke network throughout North
  America.
• Full truckload shipments move directly from DC to
  customers warehouses or stores.

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Freightliner
1

• 1. Inbound Movement
• Subassemblies (axles and engines) arrive by ship
  from Germany and Finland primarily through T-6.
• Other parts and subassemblies arrive by truck
  from Mexico and Canada, and by truck/rail
  intermodal from domestic suppliers.

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2

• 2. Manufacturing
• Steel and aluminum sourced locally.
• Medium and heavy-duty trucks produced at Swan
  Island production facility for global
  distribution.

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3

• 3. Distribution
• Finished trucks are distributed to dealers
  throughout the U.S.
• Parts are shipped to regional warehouses.

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4

• 4. Exports
• Western Star brand trucks are shipped to
  Australia and New Zealand predominantly through
  T-6.

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Fred Meyer
1

• 1. Inbound Movement
• Asian imports arrive predominantly through T-6
  and are sent to Fred Meyer distribution centers
  in Chehalis, WA and Clackamas, OR.
• Various grocery items and general merchandise
  arrive via truck and truck/rail intermodal from
  domestic suppliers.
• Seasonal goods for Kroger Supermarkets arrives
  through T-6.

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2

• 2. Reload Facility
• Kroger seasonal items are trucked to north
  Portland transload facility.
• Containers are unstuffed and consolidated into
  domestic containers before being trucked to
  intermodal facility.
• Goods are shipped via rail to Krogers
  distribution center in Nashville, TN.

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3

• 3. Warehousing/Distribution
• All food and nonfood items from international and
  domestic suppliers are sent to Clackamas
  distribution center for distribution to stores
  throughout the west (except WA and AK stores)

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4

• 4. Retail/Local Consumption
• Fred Meyer Stores operates a large fleet of
  trucks and trailers for distribution of goods to
  its retail stores.

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U.S. Metropolitan CentersFifty Largest
22
Manufacturing CentersEmployment Density by County
23
Wholesaling/Distribution CentersEmployment
Density by County
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International Freight GatewaysExports Imports
(Tons), 1998
Imports
Exports
Source FHWA Freight Analysis Framework Project
Reebie Associates 1998 data (1st
Approximation)WEFA economic data and forecasts
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Metropolitan Freight CentersMajor Population
Areas
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Freight Transportation Demand Growing in Most
Urban Areas

• Portland origin/destination freight volume to
  double by 2030

Thousand Short Tons
Thousand Short Tons
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Commodity Share of Portland/Vancouver Region
Tonnage
(Percent Share of Total Tonnage in 1997)
Eight commodity categories comprise 74 of all
tonnage shipped in the region on all modes.
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Freight Mobility Largely Dependent Upon Trucks
1996
2030
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Pass Through Tonnage Doubles
Thousand Tons

• The Portland region handles increasing pass
  through traffic for elsewhere in the country.

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ChallengesMeeting Urban Access Needs for
Container Growth
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ChallengesMaintaining Industrial Land Adjacent
to Freight Corridors
32
ChallengesMaintaining Good Access to
Warehousing and Distribution Centers
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ChallengesFor Most Urban Areas Capacity
Increases Represent a Hurdle
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Implications

• Industry specialization and reliance on
  efficient transportation means industries may
  choose to relocate if transportation costs affect
  their ability to compete
• Congestion has real costs and affects business
  productivity
• Hard costs
• Extra time for pick-up and delivery/reduced
  production time
• Extra vehicles to meet just-in-time demands of
  customers and scheduling problems caused by
  longer delivery times
• Soft costs
• Business credibility
• Expansion decisions

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Urban Freight Planning Tools

• Freight modeling
• Regional/local transportation plans
• Investment strategies
• Economic Base analysis
• Forecasting
• Comprehensive plans
• Land use location analysis
• Land use and tax policy assessment
• Design standards
• Access management policies

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Urban Freight Planning Approach in Portland

• Planning/Policy/Research
• Reflect freight in regions transportation and
  land use plan
• Key Freight Corridors
• Industrial lands and intermodal facilities
• Other freight facilities
• Local transportation plans reflects freight
  routes
• Policy emphasis on maintaining access to
  intermodal facilities and industrial sanctuaries
• Research on industry freight needs
• Freight bottlenecks
• Supply-chain geography
• Economic relationship to freight investments
• Freight Advisory committees
• Regional, City and Statewide-linked by membership

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Urban Freight Planning Approach in Portland

• Forecasting/Analysis
• Commodity flow forecast for six county region
• 41 Industrial sectors- tonnage, mode and growth
• Truck Model
• Identification of freight bottlenecks
• Port Transportation Improvement plan (PTIP)
• City Freight plan
• Region priority freight needs
• Investments
• Oregon Transportation Investment Act-legislative
  program with freight emphasis
• Region allocation for federal funds
• Port request for demonstration projects