Indiana prepares roadmap to stay leader in logistics

December 8, 2008
Nearly 70 years ago at the New York City World's Fair, General Motors unveiled an exhibit and stunned the world with its futuristic look at a super road system that would connect all corners of the United States.

If you compare that exhibit to a schematic of today's interstate system, you'd have an almost perfect match.

Who would have thought what those visionaries outlined in 1939 would be today's interstate system? And that it would change the way we transport people and commodities across the country.

We hope to replicate that success and not only develop plans for a road system that changes the way we do business, but couple that with the best water, rail and air transportation for swift and efficient transportation of goods from concept to store shelf across Indiana and the country.

The amount of domestic freight transported across the country is expected to double by 2035. Indiana has a lot to gain from this explosion by finding ways to leverage its existing transportation, distribution and logistics assets and identifying new opportunities.

Conexus Indiana, an industry-driven advanced manufacturing and logistics initiative, is spearheading the development of a strategic logistics plan. The first step? Listening to businesses from all corners of the state that transport and strategically manage the movement of goods by rail, truck, water and air. The final step: a strategic solution that takes into account statewide input to shape public policy in the logistics arena.

We've talked with more than 500 businesses across the state to pinpoint challenges in each region and uncover opportunities for improvement. Our last stop was in South Bend, where we heard from more than 50 businesses. Other stops this fall included Evansville, Fort Wayne, Jeffersonville, Portage and central Indiana.

Here are some of the challenges and opportunities that we discussed:

Chicago congestion

Because there is limited rail service between Indiana and the western United States, a significant amount of rail freight is transferred to different carriers or between different modes of transportation in Chicago. And in Chicago — an overtaxed transportation hub — freight can sit for days before moving to its final destination. That delay costs manufacturers millions — but it also represents a significant opportunity for Indiana to provide an alternative. Studies are ongoing in Evansville and Hendricks County to determine the feasibility of intermodal facilities. Other regions are investigating both rail and port intermodal facilities.

It's clear Indiana is in a good position to leverage intermodal facilities, but we must do so with an eye toward creating facilities that will have the greatest statewide impact. According to the Ports of Indiana, just one intermodal facility in Indiana could have a significant economic impact: $800 million in development investments, 16,000 new permanent jobs, 20,000 construction jobs and $27 million in property tax revenue. It behooves us to find the best location for these economic engines.

Keep on trucking?

While Indiana leads the nation in interstate highway access, it does pose a challenge for truck drivers because of the state's truck weight and trailer-length limits. This is of particular concern in northern Indiana for truck drivers entering from Michigan, where truck weight limits are less restrictive. This causes truckers to dump loads and make multiple trips to cross the state. Dedicated truck lanes could be a solution, allowing for heavier loads and safer travel conditions.

At the same time, our interstate system and arterials are becoming crowded, with further congestion within sight. In northern Indiana, a solution could come in the form of the Illiana Expressway. In the New Albany area, the Ohio Rivers Project is key to opening the flow of national and international goods, thus fueling the region's economic growth. Other opportunities involve better use of existing air and marine facilities.

A work force for the future

Indiana is rich in manufacturing and logistics jobs. According to the Indiana Business Research Center, manufacturing and logistics make up 27 percent of state jobs. In central Indiana alone, the Indianapolis Private Industry Council estimates that 9,000 logistics jobs will be created by 2012, joining more than 41,000 in the region who already work in such jobs.

But there is a shortage of qualified CDL drivers in many regions, and many students are not pursuing careers in logistics, despite more and more university and community college courses geared toward logistics careers. We need to understand what industry needs and develop courses that match those needs. Not only to get students excited about careers in logistics, but also to prepare them to take on management-level positions.

Show us the money

Solutions and opportunities for raising Indiana's profile in the logistics arena won't come without significant capital investment. And that can't come from just the private sector or the public sector. We need to investigate innovative funding sources and innovative partnerships to encourage public/private investment in these transportation solutions.

Our strategic plan will look at how the state can work together to advance our agenda as the leading logistics player in the country.

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D'Amico is CEO of Conexus Indiana. Launched by the Central Indiana Corporate Partnership, Conexus Indiana is the state's advanced manufacturing and logistics initiative. Views expressed here are the writer's.
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