NAIPN Map Nope, I don’t have a crystal ball and my record of predicting the future is anything but stellar; just a quick look at my buy and sell choices in the stock market, over the last 20 years, would leave you convinced that the title of this post is dripping with audacity. That’s why it’s couched as a question rather than a statement. You’ll do well to consider my assertions, read the source material, and come to your own conclusions.

I just finished reading a very interesting post by Dan Goodwill titled “NASCO (North America’s Super Corridor Coalition)” and it got me to thinking. First, a little background so you know where I’m going with this. Back in October I authored a post in which the issue of some new regulations being proposed for the ports of Los Angeles and Long Beach were thoroughly inspected. Well, as thoroughly inspected as possible in a blog post. The entry didn’t seem to generate much interest, maybe very few folks figured it would impact them directly, so I didn’t bother following up with a post when the regulations were adopted in early December or when the new container fees were approved about ten days later.

In case you decide against following all the links in the preceding paragraph, and I really wish you wouldn’t, I’ll (very) briefly summarize the ports’ situation. CARB pushed a proposal that “would ban all trucks with pre-1994 engines and older from entering ports or rail yards, and would require retrofitting of engines manufactured between 1994 and 2002.” Included in the once proposed and recently adopted regulations are stipulations that “would require all truck drivers at the port to be employees of concessionaires, which would be limited by an application process that would favor trucking companies with the largest amount of financial assets, among other considerations.”

Of course, these aren’t the only situations covered by a set of regulations that’ll result in huge costs being incurred by everyone doing business with the ports of Long Beach and Los Angeles. In order to help pay the related expenses, a new fee, which ranges from $35 to $75 (depending on length) per container, was proposed and subsequently adopted. That means, as I said in my related post, “an increase in revenue, to just these two ports, of approximately $300 million per year. Not only that, if growth projections are on track, the revenue from these annually realized fees will be $600 million by 2020.”

It is an economic truth that taxes create a disincentive; so there’s a possibility that the new fees might have a negative impact on the ports’ projected growth. And that’s where the Dan Goodwill post enters the picture.

The North American SuperCorridor Coalition, Inc. (NASCO), begun in 1994, “is a nonprofit organization dedicated to increasing economic development activity while supporting multi-modal infrastructure improvements, technology / security innovations and environmental initiatives.” To achieve these goals a NASCO working group, the North American Inland Ports Network (NAIPN), was established with the goal of developing a network of multi-modal facilities along the trade corridor to facilitate the inter-modal movement of containerized freight.

Oh yeah, and the primary ports of call for the container ships delivering freight bound for the yet to be built Inland Ports are located in Mexico. The proposed Inland Ports are set to be located on the Super Corridor which, in the U.S., runs up the center of the country using I-35.

With the flow of containerized freight anticipated to grow by several hundred percent over the next ten to fifteen years, coupled with the increased cost of fuel and a prohibitive fee and regulation structure adopted by the two SoCal ports currently handling 40% of all containerized freight moving into the U.S., it seems inevitable that those paying the freight bill will be looking for alternative methods of getting the goods into the hands of consumers. Especially considering the fact that every other port in California is considering the adoption of these new regulations.

Like it or not, consumer spending accounts for 70% of the U. S. economy so any increase in the cost of goods sold, no matter the reason, has a significant impact on economic growth and, in some instances, inflation. Put all this together and you can see that powerful forces will soon be aligning themselves in an effort to make the transportation of goods become far more efficient than it is, currently. One method of increasing efficiency is to allow for the use of longer trailers hauling, possibly, heavier loads. Another method is to increase the use of rail transportation.

With shippers facing higher costs due to increased regulation, fees and fuel costs, the ports in Mexico are likely to become more and more attractive for both imports and exports; bypassing the increasingly expensive California port facilities. Containerized freight entering these ports will then move north, primarily but not exclusively, by rail. But we all know that most shippers and consignees will need to employ trucks for the pick up of loaded containers at the railhead and the return of empties.

Increasing the amount of containerized available for trucking from inland inter-modal facilities might be just what the doctor ordered. Truck rates for container freight have increased over the last several years and, with shorter hauls, the possibility exists that a much higher number of decent paying “localized” trucking jobs could be available in the future. Beyond that, if this Super Corridor is successful there’s a high likelihood that others will be developed, furthering the opportunities for short haul trucking and truckers.

Obviously, long haul trucking as we know it won’t be disappearing anytime soon. There will always be a need to move some freight, like the stuff Everitt hauls, by truck from beginning to end. Still, the possibility that an increase in the availability of inter-modal freight might increase the demand for short-haul truckers, which could also have a positive impact on the wages and working conditions for long-haul truckers, is something to look forward to. That is, if I’m right. What do you think?