Riding the U S and Global Economic Rebound
Riding the U. S. and Global Economic Rebound - Opportunities and Challenges Randy Mullett Vice President - Government Relations & Public Affairs, Con-way Inc. FHWA Talking Freight Webinar February 16, 2011
Con-way Today – who we are • $5. 0 Billion Industry Leader in Freight Transportation and Logistics • Con-way Freight • Con-way Truckload • Menlo Worldwide Logistics • 30, 000 employees worldwide • Over 500 operating locations • 11, 500 trucks, 35, 000 trailers, 20 million sq ft warehouse space globally • 150, 000 customer pickups and deliveries daily in N. America • Nearly one billion miles annually moving freight on USA highways • Consume 150 million gallons of diesel fuel annually 2
Trucking / Intermodal Statistics • Over 500, 000 trucking companies in the US • 97% have fewer than 20 trucks • Pay 40% of HTF total and drive 13% of the miles • 70% of all goods (by weight) in the US move by truck • 83% by value • 97% of all consumer goods • Future modal shares are expected to stay fairly constant • Over 80% of US communities are served only by truck • Shipments traveling >500 miles only 13. 4% of the truck freight market • If rail intermodal capacity doubled by 2020, market share will be only 1. 8% vs. today’s 1. 5% if capacity stayed constant
A Framework to Remember We can not separate economic growth from the growth of transport resources and infrastructure.
Motor Carrier Trends Demand
ATA’s For-Hire Tonnage Index Seasonally Adjusted; 2000 = 100 Through December 2010 In 2010 Truck Tonnage was up 5. 7% Source: ATA
ATA’s For-Hire TL Loads Index Seasonally Adjusted; 2000 = 100 Through November 2010 Source: ATA
Total Business Inventories-to. Sales Ratio (Includes retail, wholesale, and manufacturing; Through November 2010) Sources: Department of Commerce and ATA
Loads Jan - Nov 2010 Compared with Same Period in 2009 Source: ATA’s Trucking Activity Report
Motor Carrier Trends Supply
Trucking Failures only includes fleets with at least five trucks Source: Avondale Partners, LLC
U. S. Class 8 Truck Sales Monthly Retail Sales; Through December 2010 Annual Figures 2005: 253 k 2006: 284 k 2007: 151 k 2008: 133 k 2009: 95 k 2010: 106 k Source: Wards
For-Hire TL Supply vs Demand 2005 = 100 TL Loads Index TL Tractor Count Index Oversupply Through November 2010 Source: ATA
Long-Run Freight Transportation Outlook
Growth in Tonnage Total Increase from 2009 to 2021 Rail Intermodal Air Trucking Waterborne Rail Carload Pipeline Source: U. S. Freight Transportation Forecast to 2021
Distribution of Tonnage by Mode: 2009 vs 2021 2009 Source: U. S. Freight Transportation Forecast to 2021
Crude Oil Prices WTI, US$ per Barrel Source: IHS Global Insight
On-Highway Diesel Prices Price Per Gallon Source: Energy Information Administration
Why does it matter? • Freight in all modes will increase (26% by 2020) with resulting capacity constraints • Energy and sustainability concerns will increase. • Rates will increase. Delays will occur. Economy will be affected. • Supply chain disruptions will result in “near sourcing” • Feds, States, and Communities will rediscover that freight and freight infrastructure are the underpinnings of economic development.
Challenges • CSA • Hours of Service Rules • Fuel / Energy / Sustainability • International Competitiveness • Livability • Physical Capacity / Productivity
Railroad, Airline, Trucking, and Private Business Total Factor Productivity 1987– 2008
Politics: Potential opportunity? • Underlying issues that existed during our freight capacity “crisis” are unchanged • Changes in Congress • No Tax Increase Pledge • No Earmarks • Tea Party Influence • State Responsibility
Remember ECONOMIC GROWTH cannot be separated from TRANSPORT GROWTH.
- Slides: 23