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21st Annual “State of Logistics Report®”The Great Freight Recession  3PL Summit & Chief Supply Chain Officer Forum 2010   ...
US Business Logistics Costs                                                                   1.39                        ...
The US Business Logistics System Cost is the    Equivalent of 7.7 Percent of Current GDP in 2009                          ...
Logistics Cost As A Percent of GDP    10.3           9.5                     9.5   9.8   9.9                              ...
Total US Business Inventories              Billions of Dollars      2300                              US Recessions      2...
The Inventory to Sales Ratio Has Returned to               Pre-Recession Levels     1.50     1.45     1.40     1.35     1....
US Average Commercial Paper Rates                   Continued to Fall in 2009                   Billions of Dollars       ...
The US Business Logistics System Cost is the    Equivalent of 7.7 Percent of Current GDP in 2009                          ...
Number of Truck Drivers vs Freight Carried                                                       Drivers     Freight    11...
US Ports Lose Ground in 2009    Ports                2009         2008         2007         2006    Los Angeles        5,0...
Monthly Tonnage Indicator for Internal Waterways        55                                                                ...
Index of Logistics Costs as a Percent of GDP                         1989 - 2009                                          ...
GDP Growth and Logistics Cost Growth                            GDP   Logistics Costs       2005   2006   2007     2008   ...
Looking Ahead     • Real GDP estimate for the first quarter of 2010 was revised       downward recently to 3 percent, foll...
Looking Ahead     • Unemployment rose again to 9.9 percent in April 2010, but is       expected to decline in May     • Th...
Looking Ahead                         2010 Truck Tonnage                                       2010 Rail Carloadings      ...
Summary     • 2009 Logistics Costs fell to $1.1 trillion     • Logistics cost were equivalent to 7.7 percent of GDP in 200...
• Copies of the 21st Annual State of Logistics Report© are       available at http://cscmp.org/     • More information and...
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Rosalyn Wilson from Delcan Corporation on ‘Examining the State of Supply Chain & Logistics – Riding Out the Recession’

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Transcript of "Rosalyn Wilson from Delcan Corporation on ‘Examining the State of Supply Chain & Logistics – Riding Out the Recession’"

  1. 1. 21st Annual “State of Logistics Report®”The Great Freight Recession 3PL Summit & Chief Supply Chain Officer Forum 2010 eyeforTransport Atlanta, GA June 22, 2010 Rosalyn Wilson Delcan Corporation
  2. 2. US Business Logistics Costs 1.39 1.31 1.34 1.18 1.10 1.01 1.03 0.97 0.95 0.92 $ Trillions1
  3. 3. The US Business Logistics System Cost is the Equivalent of 7.7 Percent of Current GDP in 2009 $ Billions Carrying Costs - $1.851 Trillion All Business Inventory Interest 5 Taxes, Obsolescence, Depreciation, Insurance 233 Warehousing 119 Down 14.1% Subtotal 357 Transportation Costs Motor Carriers Truck – Intercity 368 Truck – Local 174 Subtotal 542 Other Carriers Railroads 50 Down 20.2% Water (International 25, Domestic 4) 29 Oil Pipelines 10 Air (International 14, Domestic 15) 29 Forwarders 28 Subtotal 146 Shipper Related Costs 9 Logistics Administration 42 TOTAL LOGISTICS COST 1,095 Down 18.2%2
  4. 4. Logistics Cost As A Percent of GDP 10.3 9.5 9.5 9.8 9.9 9.3 8.8 8.6 8.8 7.7 2000 2001 2002 2003 2004 2005 2006 2007 2008 20093
  5. 5. Total US Business Inventories Billions of Dollars 2300 US Recessions 2100 1900 1700 1500 1300 Recession Dates: 3/1/2001 to 11/1/2001 and 12/1/07 to 7/1/09 Source: US Department of Commerce, Census Bureau4
  6. 6. The Inventory to Sales Ratio Has Returned to Pre-Recession Levels 1.50 1.45 1.40 1.35 1.30 1.25 1.20 20 20 20 20 20 20 20 20 20 20 00 01 02 03 04 05 06 07 08 09 Source: US Department of Commerce, Census Bureau5
  7. 7. US Average Commercial Paper Rates Continued to Fall in 2009 Billions of Dollars 7 6 5 4 Percent 3 2 1 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: Board of Governors of the Federal Reserve System6 5
  8. 8. The US Business Logistics System Cost is the Equivalent of 7.7 Percent of Current GDP in 2009 $ Billions Carrying Costs - $1.851 Trillion All Business Inventory Interest 5 Taxes, Obsolescence, Depreciation, Insurance 233 Warehousing 119 Subtotal 357 Transportation Costs Motor Carriers Truck – Intercity 368 Truck – Local 174 Subtotal 542 Other Carriers Railroads 50 Water (International 25, Domestic 4) 29 Oil Pipelines 10 Air (International 14, Domestic 15) 29 Forwarders 28 Subtotal 146 Shipper Related Costs 9 Logistics Administration 42 TOTAL LOGISTICS COST 1,0957
  9. 9. Number of Truck Drivers vs Freight Carried Drivers Freight 115.0 110.0 105.0 100.0 95.0 90.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: Bureau of Labor Statistics, Bureau of Transportation Statistics, and author estimates8
  10. 10. US Ports Lose Ground in 2009 Ports 2009 2008 2007 2006 Los Angeles 5,028,998 5,670,897 5,740,261 5,743,400 Long Beach 3,765,560 4,611,671 4,994,949 4,798,617 New York 3,587,740 3,992,258 3,935,262 3,678,247 Savannah 1,914,751 2,115,986 2,041,521 1,609,131 Oakland 1,398,420 1,394,684 1,451,326 1,414,782 Norfolk 1,375,632 1,591,566 1,573,273 1,424,993 Houston 1,256,049 1,370,759 1,415,657 1,295,366 Seattle 1,072,838 1,082,573 1,289,364 1,222,596 Charleston, 954,836 1,330,919 1,408,434 1,517,311 SC Tacoma 873,708 1,129,301 1,150,590 1,095,896 Source: Journal of Commerce PIERS Database, measured in TEUs9
  11. 11. Monthly Tonnage Indicator for Internal Waterways 55 2006 50 2007 2008 45 2009 40 35 30 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: US Army Corps of Engineers, Navigation Data Center10
  12. 12. Index of Logistics Costs as a Percent of GDP 1989 - 2009 Inventory Transportation Total 110 US Recessions 90 Index 1985 =100 70 50 30 1990 1995 2000 2005 2009 Recession Dates: 3/1/2001 to 11/1/2001 and 12/1/07 to 7/1/0911 9
  13. 13. GDP Growth and Logistics Cost Growth GDP Logistics Costs 2005 2006 2007 2008 200912
  14. 14. Looking Ahead • Real GDP estimate for the first quarter of 2010 was revised downward recently to 3 percent, following a fourth quarter 2009 estimate of 5.6 percent • Inflation rate remains low at 2.2 percent in April 2010 and the cost of living declined .1 percent in April as well • Industrial Production has expanded every month in 2010 10 Industrial Production 5 0 -5 -10 -15 Jan 07 Jul 07 Jan 08 Jul 08 Jan 09 Jul 09 Jan 1013
  15. 15. Looking Ahead • Unemployment rose again to 9.9 percent in April 2010, but is expected to decline in May • The pace of job creation is picking up in the second quarter of 2010 and initial jobless claims are tapering off • The For-hire transportation industry has lost over 300,000 jobs since the start of the recession, more than half of them in 2009. Jobs Lost 2009 Total Jobs Lost Air (includes passenger) 20,100 50,300 Rail 17,200 20,800 Water 400 9,800 Truck 109,000 216,500 Pipeline 1,800 2,00014
  16. 16. Looking Ahead 2010 Truck Tonnage 2010 Rail Carloadings 2.00 4.5 Percent Change Percent Change 1.50 3.0 1.00 1.5 0.50 0.0 0.00 -1.5 Jan Feb Mar Apr Jan Feb Mar Apr Source: ATA Truck Tonnage Index, SA Source: AAR RailTime Indicators, SA 2010 Rail Intermodal 2010 Container Traffic 3.0 1.10 Percent Change Million TEUs 1.5 1.05 0.0 -1.5 1.00 -3.0 -4.5 0.95 Jan Feb Mar Apr Jan Feb Mar Source: AAR RailTime Indicators, SA Source: Global Port Tracker15
  17. 17. Summary • 2009 Logistics Costs fell to $1.1 trillion • Logistics cost were equivalent to 7.7 percent of GDP in 2009 – the lowest level recorded to date • Transportation costs dropped 20.2 percent and now account for 4.9 percent of nominal GDP – all modes dropped substantially • Inventory carrying costs declined 14.1 percent and now account for 2.5 percent of nominal GDP – both decreased inventories and lower interest rates contributed16 17
  18. 18. • Copies of the 21st Annual State of Logistics Report© are available at http://cscmp.org/ • More information and related interviews and quotes are available at http://state-of-logistics.presslift.com/2010 Rosalyn Wilson Delcan Corporation 703-587-6213 R.Wilson@Delcan.com17
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