Increasing the Capacity of Freight Transportation

Disruptions are increasing in North American supply chains. North American freight transport capacity is threatening economic competitiveness. Rising shipping costs, increasingly lengthy shipping times, increasingly variable transit times, and increasingly large inventories are all evidence of constraints in the freight transport system. As North American manufacturing and retail’s reliance on imports has increased, highway and rail infrastructure has been neither maintained nor expanded in critical places. Other factors, such as increased fuel prices, security requirements, border delays, and a shortage of truck drivers are eroding the freight transport system’s performance. Consequently, shippers are stocking more parts and supplies, resorting to expensive backup transportation, and revisiting facility location decisions to cope with disruptions. In February 2006, more than 30 U.S. and Canadian private- and public-sector stakeholders met to discuss the declining performance of the North American freight transport system and to determine strategies for increasing freight transportation capacity. Participants identified examples of current and expected economic effects of capacity constraints on the freight transport system. They also highlighted specific physical, contractual, and regulatory constraints to the free movement of freight and charted a path toward addressing the most pressing issues through public-sector, private-sector, and joint action. This document summarizes the workshop discussions and the participants’ consensus.