Florida Economic Development Council

Global Logistics Global Logistics Development PartnersDevelopment Partners

Logistics - Driven Economic DevelopmentIn a New Global Environment

Florida Economic Development Council

Orlando June 24th, 2011

Adam Wasserman

FEDCFEDC

Session Session

Logistics and Economic DevelopmentLogistics and Economic Development

SpeakersSpeakers Global Logistics Development PartnersGlobal Logistics Development Partners CSX IntermodalCSX Intermodal Lykes DevelopmentLykes Development Florida Chamber Foundation Florida Chamber Foundation

US/Canada EconomyUS/Canada Economy

US and Canada:US and Canada:comprise 5% of the world’s populationcomprise 5% of the world’s population

Mature MarketsMature Markets

Economic CompetitivenessEconomic CompetitivenessUS Imports $2.5 B (2008)US Imports $2.5 B (2008)US Exports $1.8 B (2008)US Exports $1.8 B (2008)

$821 B Deficit in Manufactured Goods$821 B Deficit in Manufactured Goods$144 B Surplus in Services $144 B Surplus in Services


Global Logistics and Global Logistics and Economic DevelopmentEconomic Development

Manufacturing – Increasingly about Manufacturing – Increasingly about advanced technologyadvanced technology

EnergyEnergy Auto- RelatedAuto- Related Industrial EquipmentIndustrial Equipment Medical DevicesMedical Devices ElectronicsElectronics

And othersAnd others Global Logistics Global Logistics Development PartnersDevelopment Partners

What Does Logistics Mean to You?What Does Logistics Mean to You?

ProductionProduction Inbound raw materials and componentsInbound raw materials and components Outbound finished productOutbound finished product

ConsumptionConsumption DistributionDistribution


The State of Global LogisticsThe State of Global LogisticsGlobal logistics is evolving – market and geo-politicalGlobal logistics is evolving – market and geo-political

Input costs – OilInput costs – Oil New Infrastructure (eg. Panama Canal)New Infrastructure (eg. Panama Canal) Shifting marketsShifting markets Congestion at pinch-pointsCongestion at pinch-points Business competition not sitting idleBusiness competition not sitting idle Public PolicyPublic Policy

ResultsResults Supply chains reactSupply chains react Investment patterns evolveInvestment patterns evolve Some of this is quite obvious and some very incrementalSome of this is quite obvious and some very incremental Investors are following the trendsInvestors are following the trends


The Fuel Cost FactorThe Fuel Cost Factor

As fuel costs increase, companies are As fuel costs increase, companies are re-evaluating supply chain elementsre-evaluating supply chain elements

Effects:Effects: More rail More rail Premium on efficient facilities to smooth import and export Premium on efficient facilities to smooth import and export

processprocess

Fuel costs will make Mexico more attractive for Fuel costs will make Mexico more attractive for manufacturing vs. Asiamanufacturing vs. Asia


Global Logistics TrendsGlobal Logistics Trends

MaritimeMaritime Import trade - dominated by Asia to US (West Coast)Import trade - dominated by Asia to US (West Coast) Some trending toward supply chain diversificationSome trending toward supply chain diversification Aspirations for more cargo at Gulf Coast portsAspirations for more cargo at Gulf Coast ports Increased focus on Latin America (north-south routes)Increased focus on Latin America (north-south routes) The economic downturn has changed the gameThe economic downturn has changed the game Ports and logistics hubs becoming critical cogs in the supply Ports and logistics hubs becoming critical cogs in the supply

chainchain Not simply terminals for cargo movementNot simply terminals for cargo movement Value-add centersValue-add centers Distribution hubsDistribution hubs


Global Logistics TrendsGlobal Logistics Trends

RailRail

Massive investments in rail infrastructureMassive investments in rail infrastructure Increased efficiency Increased efficiency North-South routes becoming more importantNorth-South routes becoming more important Intermodal activity is the driverIntermodal activity is the driver Dynamics between rail and truck are different than Dynamics between rail and truck are different than

beforebefore


The Outlook-Panama CanalThe Outlook-Panama Canal

$6B investment, completion in a few years$6B investment, completion in a few years Some think a game-changerSome think a game-changer Cargo traffic for Texas, Mid-South, Midwest may Cargo traffic for Texas, Mid-South, Midwest may

be diverted from LA/Long Beachbe diverted from LA/Long Beach Assumes adequate Gulf port facilitiesAssumes adequate Gulf port facilities North-South highway linkages will be importantNorth-South highway linkages will be important


““Portcentric” OpportunityPortcentric” Opportunity

Cargo movement will probably change at a Cargo movement will probably change at a faster pacefaster pace

SeaPort vs. LandPortSeaPort vs. LandPort Access to strategic “domestic” marketsAccess to strategic “domestic” markets All about multi-modalAll about multi-modal Potential = Land + Market + Transport InfraPotential = Land + Market + Transport Infra


From an Investor’s PerspectiveFrom an Investor’s Perspective

From an investor perspective logistics-driven From an investor perspective logistics-driven opportunity is increasingly interesting an opportunity is increasingly interesting an propositionproposition

Foreign trade necessityForeign trade necessity Focused on strategic, business-friendly localesFocused on strategic, business-friendly locales Access to key infrastructure and cargo serviceAccess to key infrastructure and cargo service

- Seaports - Air Cargo Airports - Class 1/Short-line Rail- Seaports - Air Cargo Airports - Class 1/Short-line Rail

Proximity to Mexico and CanadaProximity to Mexico and Canada


EDO’s Taking the InitiativeEDO’s Taking the Initiative

Reality:Reality: Responsibility to ‘join-up” various elements Responsibility to ‘join-up” various elements

resides nowhereresides nowhere

Little Washington role or resourcesLittle Washington role or resources DoT’s and DoC’sDoT’s and DoC’s Local and State governments are out of cashLocal and State governments are out of cash Learn from success - places that have Learn from success - places that have

integrated infrastructure planning and integrated infrastructure planning and economic developmenteconomic development


Key Role for EDO’sKey Role for EDO’s

Action:Action:

EDO’s have the unique opportunity to be regional EDO’s have the unique opportunity to be regional “quarterback”“quarterback”

Joined-Up Business StrategyJoined-Up Business Strategy MarketMarket ProductProduct Outreach marketingOutreach marketing

.. Global Logistics Global Logistics Development PartnersDevelopment Partners

EDO OpportunityEDO Opportunity

Steps: Steps:

1.1. Understand global > local logistics patternsUnderstand global > local logistics patterns2.2. Identify the logistic supply chainsIdentify the logistic supply chains3.3. Be strategic about key target segmentsBe strategic about key target segments4.4. Partner with transport-logistics industryPartner with transport-logistics industry5.5. Create necessary productsCreate necessary products

- property assets- property assets - logistics assets- logistics assets


About GLDPAbout GLDP

Investment advisory firm specializing in Investment advisory firm specializing in emerging multi-modal logistics hubsemerging multi-modal logistics hubs

Clients: public and privateClients: public and private

Fundamentals:Fundamentals: Understand importance of global logisticsUnderstand importance of global logistics Market definition and targetingMarket definition and targeting Delivery and public-private partnershipsDelivery and public-private partnerships


GLDP ExpertiseGLDP ExpertiseSenior professional expertise inSenior professional expertise in

- Market analyticsMarket analytics- Supply Chain ManagementSupply Chain Management- Economic developmentEconomic development- Infrastructure planningInfrastructure planning- Business attraction Business attraction - Project delivery-financeProject delivery-finance- Global logistics Global logistics - Ports/terminals managementPorts/terminals management- Site SelectionSite Selection


Thank you. Thank you.

Global Logistics Development PartnersGlobal Logistics Development Partnersappreciates the opportunity to meet youappreciates the opportunity to meet you..

Adam Wasserman Adam Wasserman 623 341 0602623 341 [email protected]@gldpartners.com


Documents

Florida Economic Development Council