T.R. Lakshmanan

1. Road-Rail Intermodalism: Opportunities and Barriers T.R. Lakshmanan Center for Transportation Studies Boston University Road Rail Intermodalism Workshop held at AASHTO Building September 22-23, 2005 Washington, DC

2. Presentation Outline 1. Road Rail Intermodalism: Definition & Scope 2. The Emergence of Short haul Rail as a Public/Private Policy Issue 3. The Evolving Decision Contexts in Short haul Rail 4. Experience with Short Rail Corridors 5. Towards New Modals of Intermodal of Transport Service

3. Intermodalism represents the use of at least two modes of transport in an integrated manner, in a door-to door transport chain. Integrated implies: coordinated, seamless, flexible, and continuous flow Road Rail intermodalism is used in the sense of short haul rail freight movement along a corridor or a geographically banded area. Freight movement is a directional flow linking major freight nodes (terminals) and has a mainline rail element with connecting roadways. e.g. Alameda Corridor FAST Corridor in Washington State Mid Atlantic Rail Corridor.

4. Such Corridor Projects offered as Solutions to Major Problems in the U.S. Transport System: • Increasing Congestion in Major Metros & Cargo Hubs • Potential for Degradation of Transport Service Quality • Threats to U.S. Trade Performance and Industry competitiveness - New Decision Contexts for New Corridor Projects * Sustainable Transport Criteria * Financing Mosaics * Stakeholder Partnerships

5. Factors Underlying Transport Problems Demand Side Factors  volume expansion  locations of demand  quality of transport services that add production value Supply Side Constraints  slow expansion of road & related infrastructure  rising congestion and degrading service Support for Future Economic Development  centers of innovation in global economy  heavily weighted towards major metros and cargo hubs

6. US Freight Shipments by tons (millions) by value (billions $)

7. Direct and Total Export Proportions for Selected Industries

8. Top 10 US International Freight Gateways Ranked by Value of Shipments 2003 ($ Billion)

9. Quality of Transport Services(beyond reliability & speed) - Transport Process Innovations * Improved vehicle utilization * JIT, quick response systems - Transport Service Innovations * New Supply Chains (Global sourcing, Changing markets) * Refashioning Supply Chains (Spatial concentration of inventories) These processes and service innovations add production value and confer strategic advantage to U.S. firms

10. Supply Side Constraints Over Two Decades 1. U.S: VMT has doubled, while highway mileage is up by 1% 2. Railroads Value of freight up by 50%, while available track mileage down by 35% 3. 42 of 75 major urban areas with “undesirable congestion” 4. Congestion is concentrated at our largest ports and rail hubs, which are co-located in major urban areas

11. Evolving Transport Services and Regional Economic Development Airfreight & Parcel Express Warehousing & Distribution Freight Operations & Regional, Global Supply Chain Management Commercial Trucking Manufacturing Railroad Intermodal Transportation Containerized Ocean Shipping

12. Transport Infrastructure, Competitiveness & Economic Growth Knowledge & Competence Endowments Industry Competitiveness & Economic Clustering Communication Infrastructure Transport Infrastructure Regulatory & Policy Environment

13. Two Major Games in the Global Economy • Urban areas in economic competition • in the global economy competing globally. • Centers of innovation in a knowledge-intensive • global economy concentrated in a few large • creative urban areas. Implications

14. Short haul rail corridors are being considered as responses - e.g. a 200 FEU train per hour in each direction for a 10 hour daily window is equivalent of about 1.5 million truck moves per year by rail. • Major investments • Tough issues of assembly of land and physical capital at desired locations • Principle beneficiaries scattered beyond urban areas • Difficulties in arriving at a consensus on solutions and • Financing among diverse affected communities.

15. New Decisions Contexts for Corridor Projects 1. E/E/S Context for Sustainable Transportation 2. Innovative Financial Framework 3. New Stakeholder Processes

16. Economic Assessment

17. Railroads a Volume Business A very cheap line haul cost/mile to offset very expensive terminal & dryage costs incurred in container movement) - 55,000 main track miles abandoned (replacement at $2-5 million/track mile. major intermodal terminals - $50-75 million) - Bring rail costs to a level to promote traffic shift from highway to short haul corridors - Public benefits and costs

18. A. Highway Marginal Trucking Cost Highway user revenues Net highway corridor costs/mile and over time B. Other External Costs - accidents - pollutions costs - energy costs - congestion costs

19. Fatalities per billion ton miles. BTU’s per ton miles.

20. Pounds of pollutant per ton mile

21. Marginal External Cost for Road & Rail Euros per 1000 tkm) Source: European Commission, 2002

22. Benefit, Beneficiaries and Potential Funding Sources For Short Haul Rail Projects Derived from TRB, 1 NCHRP Report 497. 2003

23. Categories of Funding Assitance Related to public/Private Sector Benefits