• Who are the stakeholders that influence this transportation issue?
• What solutions are being proposed or implemented to address the situation?
• What major costs will be incurred due to this issue, now or in the future?
• Ultimately, how do you think this transportation issue will impact a company's supply chain and competitiveness?

Insufficient Infrastructure Funding Impacts U.S. Mobility and Companies Such as UPS

Part Two of a Two-Part Series

"If every UPS vehicle is five minutes late due to congestion per day, it costs the company $114 million annually," says Tom Jensen, Vice President of Transportation Policy at UPS.

Whether it's legislative or regulatory policy involving intermodal freight movements, fleet and surface transportation, maritime and rail issues, aviation measures or trucking matters, Jensen is a constant presence in D.C. He is also the Chair of the U.S. Chamber of Commerce's Transportation, Infrastructure and Logistics Committee (TILC).

The $114 million annual statistic has become a mantra and message-point for the company but when one drills down, the reality seems even heavier.

Transportation policy in the United States primarily happens in silos on the federal and Congressional levels, says Jensen, but our transportation infrastructure can and does not function this way. America has an integrated multimodal system and freight can come into or move through it in a span of ways and, like water, prefers the path of least resistance and will find alternatives when it bumps up against impediments.

There are numerous connections that need to happen that impact businesses like UPS. A drayage company, for example, generally moves containers short distances to and from warehouses, rail terminals and ocean ports, and they are partners who help get goods to the American consumer and labor and business, according to Jensen.

In the supply chain, businesses and infrastructure modes encounter or have inherent congested pathways today yet interstates may be burdened with the ubiquitous bottlenecks with which the public is most familiar. Each year the American Transportation Research Institute (ATRI) releases a list that focuses on the most congested truck bottlenecks in the country and the media reacts.

Most leading companies, such as UPS, have information technology (IT) and logistical systems that are multitudinous, integrated and fluid, but also predictable.

By design, the majority of UPS's tractor-trailer drivers, known as feeder drivers, are "out and back" in the same day, and do not drive "over the road" for multiple days and nights. The company's network systems function to reduce the time that goods are in transit, as the volume of goods the company delivers has risen and customer expectations of faster delivery times has increased.

Generally, drivers arrive at work at a certain time and have set routes, and go home typically after a nine- or 10-hour shift, according to Mike Marshall, Transportation Manager for the company's Minnesota & Wisconsin territory. The majority of UPS feeder drivers will travel a few hundred miles to predetermined meet points. One driver might take a trailer out of Minneapolis and drive to Des Moines, Iowa, while another driver leaves Lenexa, Kansas, to head toward Des Moines so they can swap trailers and then each head back. Conversely, there are also a smaller number of drivers who spend a majority of their day making customer pickups, and might travel 50 to 100 miles a day.

Marshall explains how overburdened infrastructure can affect his operations: A trailer might leave the Oak Creek, Milwaukee, location and is scheduled to arrive in Chicago, at another facility, at 3 a.m. however, congestion making a driver merely 15 minutes late can have ricocheting impacts. It can affect the trailer making service, which could mean not processing thousands of packages for customers at the scheduled time.

UPS, which is a member of the U.S. Chamber of Commerce, receives numerous recognitions, has a strong corporate identity, is a profitable parcel mover, and has a commitment to positioning itself for tomorrow's world.

Forbes, in a partnership with Just Capital, named UPS among "The 2020 Just 100," which examined how publicly held businesses perform on matters of corporate justness. The 112-year-old company was also chosen by consumers "Among the Top 5 Most Loved Brands in America." The Morning Consult ranking was based on survey interviews that measured consumer sentiment in areas like trust, community impact, and Net Promoter Score.

But this alone isn't going to get Tommy his train set during the holidays.

Jensen wants people to really grasp what's at stake. In Northern New Jersey and in the New York metropolitan region, he said that today, versus just eight years ago, UPS daily dispatches 60 additional package cars because of growing congestion and because the majority of packages are time-guaranteed.

Additionally, he said to meet deadlines, UPS must dispatch 20 more tractor-trailers in that area to accommodate different loads and different configurations. He emphasizes that these scenarios just add to gridlock and that there are bottlenecks, what UPS refers to as pinch-points, throughout the nation. Among them are New Jersey and metropolitan New York, Atlanta, Houston, the Los Angeles basin, and the Chicago area where rail and highways intersect.

Read page 2