What Would Be an Ideal Logistics Future?

logistics future

Indiana is already well known throughout the world for its logistics efficiency, but in order to maintain our standing we’re going to have to continually build up our networks. But how? In what ways could we improve?

To find an answer, we turned to the men and women at the forefront of diverse points within the industry – those whose job it is to ship, to produce, to fly, to drive, to sail, to build, and to haul.

We asked them: What would an ideal Indiana logistics future look like? What kind of connections, technology, or infrastructure upgrades would Hoosier industries benefit from?

Check out their ideas on how we can take things up a notch.

Darrell L. Wilson, Assistant Vice President, Government Relations
Norfolk Southern

Indiana is blessed with a central U.S. location and business climate that fosters growth and helps Hoosier industries compete globally. Maintaining a safe, efficient, and reliable freight transportation network is critical to fully realize these competitive advantages.

With demand for freight rail transportation projected to grow by nearly a third over the next two decades, strategic investments to expand rail capacity and fluidity are essential to Indiana’s long-term economic health. Over the past three years, Norfolk Southern has invested $311 million across Indiana on track improvements and other railroad infrastructure to support growth. Working with state and local economic development officials, NS over the same period increased its rail volumes by more than 21,700 carloads while helping 22 rail-served businesses locate or expand in Indiana.

Indiana is on the right track with initiatives like its new LocalTrax grade-crossing closure and separation program. This matching grant program supports freight rail growth and addresses important transportation infrastructure, safety, and mobility issues in rail-served communities. The state’s investments in the Ports of Indiana system to expand multimodal opportunities are also welcome, such as the planned expansion at POI-Burns Harbor that adds rail capacity.

Given freight rail’s economic and environmental benefits – reducing both highway congestion and carbon emissions – Indiana’s businesses and residents are the ultimate winners of strategies that advance rail-served economic development.

Amanda Williams, Vice President, General Manager
Air Ground and Freight Services, Central Region
FedEx Express

Every day, FedEx multiplies growth by connecting people and possibilities. Over 9,000 FedEx team members at 80 facilities across Indiana help consumers conduct business in more than 220 countries and territories.

Earlier this year we announced a $1.5 billion investment over seven years to expand and modernize our FedEx Express hub at the Indianapolis International Airport, which is the second-largest sorting facility in the FedEx Express global network. The continued growth of FedEx throughout the state has been fueled by a diverse workforce, a supportive business environment and a growing portfolio of services and solutions for our customers.

E-commerce growth continues to change the logistics landscape. At the same time, customers are looking for more flexibility in handling their shipping needs. To address these parallel challenges while delivering exceptional service, we are evolving our business model and expanding pickup and delivery options.

Safety is our priority at FedEx, and we have adopted the latest in advanced safety systems across much of our FedEx trucking fleet, including telematics, collision mitigation, lane departure warning and rollover stability.

We also support increasing the safety, efficiency, and capacity of our country’s transportation system through infrastructure investment. Modernization of our country’s roads and bridges and adoption of common-sense policy solutions, such as longer combination vehicles, will ensure continued economic growth and competitiveness.

At FedEx we continue to explore and adopt new technologies for our aircraft and road fleet to provide outstanding service to our customers and reduce our environmental impact. Our commitment to sustainability includes reducing aircraft emissions intensity 30 percent by 2020, increasing FedEx vehicle fuel efficiency 50 percent by 2025 and obtaining 30 percent of jet fuel from alternative fuels by 2030.

Tom Schmidt, Owner, President
Hoosier Crane Service Company

The marketplace in the logistics industry has tightened up dramatically over the last couple of years as a result of increased demand, implementation of the ELD (Electronic Logging Device) regulations, and the lack of available labor. Carriers and brokers are being forced to cover more loads with existing drivers and equipment thereby creating bottlenecks in logistics systems that substantially affect both manufacturers and consumers. Carriers are changing the tariff rules and billing rates to accommodate the need to improve technology, equipment, and labor resources which has increased costs for delivered products. In some cases, the pricing strategies has made nonstandard sized freight pieces extremely difficult to move through the LTL environment. Additionally, increased capacity utilization is resulting in an increased damage rates on shipments that have a negative impact on all parties balance sheets.

AI is a revolution that will eventually provide some relief to the tight market conditions, but the immediate need is equipment and labor. Equipment can be procured and amortized out, but finding drivers is the number one issue to solve.

Shawn Masters, Chief Commercial Officer

An ideal Indiana logistics future would be one that truly embraces our location as the “Crossroads of America.” This would happen if Indiana develops a skilled and educated workforce prepared to do the wide variety of jobs within the logistics industry and our infrastructure (roads, bridges, rail, air, ports, etc.) supports the movement of freight safely and efficiently. Ideally there would be incentives for manufacturing to move to Indiana and tax breaks for employers. Thriving communities make Indiana a great place to live and work.

Hoosier industries would benefit from:

A workforce that supports a world-class logistics industry:

  • Support for supply chain industry jobs through both higher education as well as technical training
  • Develop and promote career pathways in the supply chain industry
  • Cutting-edge computer skills
  • Reduce health problems like smoking and diabetes in the workforce

Economic Development/Awareness:

  • Legislative awareness and support for the economic impact that the supply chain industries have for Indiana
  • Synergy w/the Economic Development groups and the supply chain industry to attract new manufacturing businesses to Indiana
  • Foster communities that provide attractive amenities

Forward-Thinking Infrastructure:

  • While progress has been made in some of Indiana’s interstate highways, additional funding for road and bridge maintenance is needed to maximize the potential as a logistics powerhouse.
  • Rail and airport growth are vital to a successful regional logistics program and Indiana has built and continues to commit in those areas.

Mark Howell, President, CEO
Conexus Indiana

Indiana is a logistics powerhouse. We’re first in pass-through highways, more than $650 billion in goods pass through our state annually and we have the second largest FedEx air hub worldwide. An ideal Indiana logistics future has us building on that strength by leveraging new technology. We have an opportunity to focus on two primary areas: improvements to digital infrastructure to create greater connectivity and improvements in transportation infrastructure that will allow for more efficient movement of goods.

By developing Indiana’s digital infrastructure, we pave the way for autonomy and connectivity on our road systems. As the public and private sectors consider how to prepare for autonomous vehicles, we must also ensure that updates to our roads and infrastructure match what’s being driven on them. The cars of 2020 won’t be able to drive on the roads of 1920. Investment in technology like 5G will support vehicles communicating information to the cloud and vehicles communicating with one another. The electrification of roads is another potential technological investment which would allow vehicles to be charged while they drive.

We must also pay close attention to our overall transportation infrastructure to ensure its operating efficiently. By focusing on our multimodal systems, we can improve the interaction of our different transportation modes that will not only aid efficiency but reduce cost to industry. For example, helping better connect our railways to our highway system could create faster and safer travel for products and people. Similarly, dedicated truck lanes on our highways could help make highway travel safer as we separate passenger movement from industry operations.

Danette Garza, CEO, Owner
Jack Gray Transport, Inc.

Jack Gray Transport, Inc. has been a region leader in the transportation industry for nearly seven decades, specializing in scrap metal, raw material and aggregate transportation services. When I took over ownership in 2015 from my friend, the late Jack Gray, I pledged to modernize every aspect of operations. We are striving to lead the way for a brighter logistics future in a number of ways.

Jack Gray Transport is now a certified Minority & Women’s Business Enterprise. We are continuing our efforts to diversify the company, particularly with the expansion of opportunities for female drivers. We are also expanding staffing of wholly-leased owner operators.

In January 2018, Jack Gray Transport added six new clean diesel-powered drayage trucks to our fleet. We continue to update our fleet of trailers, including new steel standard and double trailers.

Reducing our carbon footprint and embracing sustainable operations is part of our modernization pledge. I was honored to be recognized in February 2018 with the 2017 South Shore Clean Cities Empowering Woman of the Year award for the company’s sustainable transportation efforts.

A vibrant logistics network must also include the expansion of the port of Gary. Our company and our affiliates stand with Mayor Karen Freeman-Wilson’s efforts to enhance economic growth and employment opportunities via the port expansion.

Our ideal Indiana logistics future includes more women and minorities at all levels of the industry, a skilled union workforce, sustainable methods wherever and whenever possible, and an expanded port in Gary. We’re well on the way to the future we envision.

James Dillman, COO
Lakes & Rivers Logistics, Inc.

When I joined Lakes & Rivers Logistics in January of this year, I was excited about the potential for a brighter logistics future. Northwest Indiana is uniquely positioned to thrive in this sector.

Lakes & Rivers Logistics, Inc. is a union-proud stevedore cargo handling business whose management team has handled more than 1 million tons of bulk and break bulk annually, including raw materials for steel making, aggregates, fertilizers, salt and grain. The Buffington Harbor location has direct access to the St. Lawrence Seaway via Lake Michigan, is directly served by the Canadian National Railway and has easy highway access to Interstates 80, 90, 94, 65 and 294. Our company provides material handling for bulk and freight materials coming into the port on barges, lakers and ocean vessels and transfers that cargo to trucks and trains.

The operation at Buffington Harbor in Gary supports the vision of Gary Mayor Karen Freeman-Wilson, who is hopeful the city will have its own port to provide jobs and expand cargo handling options beyond the needs of the local steel mills and supporting industries to feed the local economy. We applaud and support her efforts.

An ideal logistics future includes a vibrant, well-maintained transportation network that provides support for all modes of transportation – on-road, marine, rail and air – and the infrastructure sustaining them. That infrastructure must also support sustainable transportation options to reduce the industry’s carbon footprint. Lakes & Rivers actively supports and regularly seeks grant funding for cleaner-burning fuels and equipment in an effort to increase the sustainability of our operations.

The future of logistics is now and Lakes & Rivers is proud to be a part of it.

Mike Daigle, Executive Director
South Bend International Airport

Being a multimodal transportation hub for north central Indiana, we have a big stake in shaping our region’s logistics future. South Bend International Airport (SBN) currently supports air and truck cargo with an opportunity to increase capacity of both. SBN is situated just a couple miles from the 80/90 Interstate. The proximity to major North American markets and over 118 million people within a one-day truck drive, makes SBN ideally suited for air-to-truck cargo development.

With the South Shore rail line terminating at SBN, there is great opportunity for rail cargo as well.  A study is currently underway to quantify demand.

Manufacturers can see immediate cash flow benefits by utilizing SBN’s Foreign Trade Zone. Custom build-to-suit facilities and integration with the Indiana Enterprise Center (IEC) are additional benefits of partnering with SBN.

Public-Private Partnerships are required to get these developments to the next level. The benefit of these opportunities will be felt regionally. Economic investment impacts every person in the communities that they live, work and play. Job growth is crucial, and we are excited to be a part of the opportunities in front of us. Our job is not to rest on our laurels, but to identify these opportunities and find business partners to facilitate win-win partnerships.

Gary Cardenas, President
TOC Logistics

Indiana has always been the Crossroads of America, given its central location and mass amount of highways and arteries that serve the Midwest, and the rest of the country. Easy access to large cities like Detroit, Chicago and St. Louis have made Indiana a massive rallying point in the Midwest when it comes to the logistics and supply chain industry.

When looking to the future, there is an important need for improved infrastructure in Indiana. Because of the way Indiana has positioned itself over the last few decades in the transportation and logistics world, we have found ourselves relying heavily on trucking and lightly when it comes to alternative transportation methods. The cost and added days in transit for getting ocean containers by rail into the Indiana market is much higher than a traditional truck/dray option from either Chicago or Detroit.

With the current ELD mandate issues and driver and chassis shortages, the lack of forward thinking on infrastructure has put Indiana in a higher-cost conundrum. Diversifying transportation and cargo movement methods and modes and making Indiana a viable alternative to traditional logistics schemes, would be ideal for Indiana’s future.

Peter Anderson, Vice President, Global Supply Chain and Manufacturing
Cummins, Inc.

As the crossroads of America, Hoosiers play an integral role in the logistics industry.

At Cummins, as experts in the systems that provide power to commercial vehicles, stationary power and other types of applications, we believe the future will include a mix of power solutions including diesel, natural gas, alternative fuels, hybrid and fully electrified powertrains.

The required infrastructure to support these power solutions is at varying states of maturity. Diesel is widely available. Natural gas has more limited availability at public fueling stations, though transit authorities and fleet operators are willing to invest in the fueling infrastructure when fuel prices drive the payback on that infrastructure. We could see more rapid adoption of natural gas technologies in some regions, if fueling availability improves. Likewise, charging infrastructure is one of the enablers of the adoption of electrified technologies, and the availability and speed of re-charging infrastructure for electric vehicles is currently a constraint on their adoption. Today, some applications which return to a central location or have predictable and repeatable driving patterns are able to invest in their own charging infrastructure.

Expectations for vehicle connectivity are also increasing as telematics systems become increasingly ubiquitous. The network capacity on cellular network infrastructure will need to keep pace with the growing data needs related to telematics adoption. With the increasing dependency on wireless telecommunications covering networks of roads nationwide, we will need to improve cellular coverage of hard to reach sections of highways that are difficult to reach today without the addition of cellular towers.

Source: Building Indiana