... the Individual → 'Mass Customization' of Products. With apologies to John
Naisbitt & Patricia Aburdene. Source Megatrends 2000 (1990) / Megatrends (
1982) ...
Freight Transportation “Megatrends”
Freight Demand Modeling: Tools for Public-Sector Decision Making Conference Paul Bingham Global Insight, Inc. Washington, DC Copyright © 2006 Global Insight, Inc.
September 25, 2006
Freight Transportation “Megatrends” y Global Boom of the 1990s Î Expanded IT Penetration in Business y Renaissance in the Arts Î More High Value Goods y Emergence of “Free-Market” Socialism Î Opening of China y Global Lifestyles & Cultural Nationalism Î More Trade & SKUs y Privatization of the Welfare State Î Less Public Money for Freight y Rise of the Pacific Rim Î Dominance of China Leads World Trade y 1990's: Decade of Women in Leadership Î More Diverse Workforce y The Age of Biology Î More High Tech Goods, Growth in Services y Religious Revival of the 3rd Millenium Î Obstacles to Trade y Triumph of the Individual Î ‘Mass Customization’ of Products With apologies to John Naisbitt & Patricia Aburdene. Source Megatrends 2000 (1990) / Megatrends (1982) Copyright © 2006 Global Insight, Inc.
09/2006
2
Increasing globalization affects freight transport more directly than passenger transportation y Reduced prices for traded goods and services; increased quality and choices available … ever more SKUs & no passport needed y U.S. enjoys lower prices for (most) imported goods y U.S. exporters benefit from larger, more open markets . . . If firms are world-class competitors y Higher job growth in the trade, transportation and distribution sectors . . . but decline in non-competitive producer industries y Faster development of gateway region and exporting industries . . . but decline in regions with non-competitive producers y Shifts in economic geography, inside and out of the U.S. y Environmental, safety and security impacts all change too Copyright © 2006 Global Insight, Inc.
09/2006
3
Economic Growth is Uneven so Trade is Uneven (Real GDP, percent change)
8 6 4 2 0 NAFTA
Other Americas
Western Europe 2005
Emerging Europe 2006
2007
Copyright © 2006 Global Insight, Inc.
Japan
Other Asia Mideast & Africa
2008
09/2006
4
China’s Role in U.S. Imports is Hard to Overstate
Percent of U.S. Containerized Import TEUs, 1995 - 2005 70 60
Percent of TEUs
50 40 30 20 10 0 1995
2000 Share of US Total (%)
2005
Share of Transpacific (%)
Note: Journal of Commerce PIERS
Copyright © 2006 Global Insight, Inc.
09/2006
5
Globalization Drives Ocean Container Trade Volume Growth to be Faster than World Economic Growth (Year-over-year percent change) 14
2006: GDP 3.9% TEUs 8.2%
12 10 8 6 4 2 0 1996
1998
2000
2002
2004
2006
2008
WORLD
2010
2012
2014
2016
2018
2020
TEUs
Source: Global Insight World Service and World Trade Service
Copyright © 2006 Global Insight, Inc.
09/2006
6
Imbalanced U.S. Goods Trade is a Reflection of the U.S. Trade Deficit and Global Interdependency y The U.S. goods trade deficit will continue despite a longterm decline in the dollar exchange rate because foreigners will continue to lend the money to finance it y Trading partners are dependent on the U.S. consumer for the demand to keep them employed y The global trade imbalance requires a global solution: y Higher U.S. savings, including federal deficit reduction and a cooling of housing and consumer markets y Faster domestic growth in Western Europe and Asia y U.S. dollar depreciation; Asian currency appreciation y Much export freight capacity will continue to move empty
Copyright © 2006 Global Insight, Inc.
09/2006
7
Equipment Economies of Scale Still Pursued When Economically Viable in Water, Rail, Air & Truck 800 700
>8000
Teu (000)
600 500 400 300 Containership Capacity on Order Weighted Towards Largest Size Vessels
100
