_jp.jpg)
UPDATES, RECENT WORK, & CONGRATULATIONS | 2023
Are Home Deliveries Increasing during the Pandemic? Update 8
Attached is my 8th update to the E-Commerce and Emerging Logistics Technology I prepared for the City of Portland, which also describes strategies employed by shippers and carriers throughout the U.S. and around the world to meet the fast-growing volume of E-commerce deliveries, and recommendations for how cities can work with industry to help manage the delivery traffic.
As you'll note, that despite the warehouse/carrier/shipper labor shortages, the doubling of the cost of containers, the highest inflation rate in 40 years, and, and, and, a global pandemic, retail sales have never been so high, and:
-
E-commerce sales now represent 13.2% of all U.S. retail sales
-
E-commerce jobs, such as Courier/messenger, and warehouse jobs grew from pre-pandemic levels by 42% to 37%, respectively, in the PDX region; and
-
12 million sf of warehouse/distribution/warehouse space was under construction in 2021, while 1.7 million sf was added to our supply, in the PDX region
In this issue, I report that I've covered all of the topics that I found interesting, and that I only see continuations of those trends. In fact, I'm unsure what else to report on and am seeking your ideas and suggestions.
Full reported is attached here.
What’s Keeping Motor Carriers from Purchasing Non-Diesel-Powered Trucks or Using Renewable Diesel?
Sorin Garber and Keith Wilson, 1/8/2022
I collaborated with Keith Wilson, CEO of Titan Freight Systems, a regional motor carrier headquartered in Portland, OR, on an article describing why we believe that the motor carrier industry will convert to alternative fueled fleets – including battery electric, R99 (renewable diesel), and hydrogen - much faster than the passenger fleet because the economics of doing so are so compelling.
The paper expresses our belief that there is a 3:1 positive benefit-cost ratio in converting from conventional diesel power to battery electric powered trucks. While battery electric trucks are as much as three times more expensive than conventional diesel trucks, as early as the first year, the cost of operating battery electric is far less expensive, and after 10 years, the operating costs of battery electric are two to three times lower.
A more immediate alternative to diesel powered trucks is using renewable diesel (a second-generation renewable fuel composed of a mixture of animal fats, feedstocks and used cooking oils). Renewable diesel can be pumped directly into a diesel-powered truck, at the same cost, and with no equipment changes or retrofits. Renewable diesel produces 60% fewer greenhouse gases than petroleum diesel. On top of that, there’s a savings in maintenance costs of at least 15%/year in using renewable diesel over petroleum diesel.
A drawback to renewable diesel in Oregon currently is the lack of available supply. Currently, renewable diesel is only available in bulk delivery and there are no retail locations. However, as shown below, according to the U.S. Energy Information Administration, availability of renewable diesel is estimated to increase from 0.6 billion gallons/year in 2020 to 5.1 billion gallons/year by the year 2024.
However, it’s not so easy for many carriers to make these changes. Many carriers will wait until they need to replace their fleets or when batteries are less expensive and have longer range, or when there is an adequate local supply of R99, or when hydrogen technology is proven to be feasible and practical. But, as fuel and maintenance represent nearly 30% of the total costs of a conventional diesel truck, and the industry operates on such a low margin to begin with, there is a positive business case for switching to an alternative to petroleum diesel fuel in the next few years for every type of carrier – big and small companies, national and local operations, and Class 5 to Class 8 truck types.
The fuller report is attached. REPORT APPENDIX
Are Home Deliveries Increasing during the Pandemic? Update 7
Attached is my 7th update to the E-Commerce and Emerging Logistics Technology I prepared for the City of Portland, which also describes strategies employed by shippers and carriers throughout the U.S. and around the world to meet the fast-growing volume of E-commerce deliveries, and recommendations for how cities can work with industry to help manage the delivery traffic.
As you'll note, that despite the warehouse/carrier/shipper labor shortages, the doubling of the cost of containers, the highest inflation rate in 40 years, and, and, and, a global pandemic, retail sales have never been so high, and:
-
E-commerce sales now represent 13.3% of all U.S. retail sales
-
E-commerce jobs, such as Courier/messenger, and warehouse jobs grew by 33.3% and 40%, respectively, in the PDX region; and
-
9 million sf of warehouse/distribution/warehouse space is under construction, while 1.7 million sf was added to our supply, in the PDX region.
Also in this issue:
-
Initiatives by municipalities to better manage all delivery traffic
-
Recent logistics and shipping changes being implanted by carriers and shippers to deal with continued increased demand, higher shipping costs, and more reliable delivery performance
-
E-Commerce in the News
Full report is attached here.
Are Home Deliveries Increasing During the Pandemic? Update 6
In this sixth update of the series, I am again providing the latest quarterly data on E-Commerce (retail) sales, development of warehouses and distribution centers for E-Commerce products, and the changes in employment of those handling, assembling, packaging, and delivering E-Commerce products.
And finally, we have some research on the actual vehicle traffic changes associated with E-Commerce delivery – see below. Also in this update are some new findings of large-scale pilot testing of drone deliveries, and efforts by shippers and carriers to reduce their carbon footprint.
Fuller report is attached here:
Are Home Deliveries Increasing during the Pandemic? UPDATE 5
Sorin Garber 5/30/2021
While e-commerce sales have been growing between 14% and 31% per year since 2015, they increased by 34% in the 1st quarter of 2021 from the same period in 2020. While this growth is in large part due to the pandemic’s impact on store closures, fears of Covid-19 contagion began to fade in the 1st quarter as nearly 30% of the U.S. population had received at least one dose of a Covid-19 vaccine, and e-commerce shopping still grew.
On-line purchases now represent 14% of all retail sales revenue with clothing, electronics, toys/hobby/do-it-yourself materials, furniture and food and personal care items representing the top online purchases.
In the 1st quarter of 2021, there was little change in total statewide and Portland region employment from the same period in 2020. However, jobs supporting e-commerce grew at the same significant rates that were experienced between 2019 and 2020. For example, courier and messenger jobs grew by 10.2% and 7.5% statewide and regionally, respectively. Similarly, warehouse and storage worker jobs grew by 8.8% statewide and 8.3% in the Portland region.
In addition, warehouse and distribution space which is linked to e-commerce continued to experience all time low vacancy rates, and there’s continually development including 2.95 million square feet in construction, and 385,000 square feet coming into the market in the 1st quarter of 2021.
Finally, Oregon now has a driverless robot delivering meals to students at the OSU Corvallis campus. Drones and more autonomous vehicle deliveries are not far off.
The fuller report is attached.
E-Commerce Trends and Growth, Portland Bureau of Transportation.
As a prelude to its update to the Portland Freight Master Plan (FMP), Mr. Garber conducted research into logistics practices, land development and last-mile delivery activities associated with the explosive growth in E-Commerce. He used a three-tiered research approach including: literature search, interviews with local shippers, carriers, freight forwarders, and economists, and directed PBOT modelling staff in updating.
CONGRATULATIONS! | recognizing partner success
SGA congratulates the Portland Bureau of Transportation for their success in being awarded two innovative IIJA grants: Central Eastside Railroad Crossing Elimination Study, and the SMART Grant to pilot a Zero-Emission Delivery Zone. I’m grateful to have been part of the expert PBOT and Alta Planning teams in preparing these grant applications.
SGA congratulates the Port of Portland for its ConnectOregon award for expansion of the AirTrans Center air cargo facility. SGA prepared the analysis of transportation costs and access to jobs and sources of labor in support of the grant application.
SGA congratulates Washington State Department of Transportation Olympic Region office for completing the Mounts Rd. to Center Dr. Auxiliary Lane Extension project, which is the first of four construction stages of its $495m I-5/Joint Base Lewis-McChord (JBLM) project. Funded through the Connecting Washington revenue package, the total program, which is expected to be completed by the year 2025, encompasses reconstruction of four interchanges, widening the mainline by one lane in each direction, overcrossing of passenger rail mainline, linking bike and pedestrian paths and local roadway connections.
Sorin Garber supported the Olympic Region office through the project’s alternatives analysis phase. He facilitated sessions with stakeholders which led to the identification of 163 alternatives and a least cost planning screening methodology to advance the most promising alternatives into the environmental process.
