Southern California economy logistics-driven, conference hears

SOUTHERN California's location and infrastructure are the reasons the area can stay a "leader" in global transportation and logistics, according to transportation industry officials who were attending the 2010 Southern California and Global Transportation and Logistics Summit in Ontario.

"This region has every reason to expand. After all, it's the eighth-largest economy in the world. It's not going to go away overnight," said Hasan Ikhrata, executive director of Los Angeles-based Southern California Association of Governments.

This is attributed in part to the contribution of the Ports of Los Angeles and Long Beach which handle 43 per cent of trade in the nation.

"I see a bright future for this area, you can't get rid of the railways, forward freight and the infrastructure," said John Wu, director of the Leonard Transportation Centre, which hosted the summit.

On the other hand, the economic downturn did see a 25 per cent decrease in the volume of freight handled by the ports in Southern California.

Union Pacific Railroad and BNSF Railway have also seen business drop during the recession. Leif Smith, general director of transportation for BNSF's California Division, was cited as saying in a report by Inland Valley, Daily Bulletin that business at the San Bernardino yard declined about 14 per cent when comparing 2009 to 2008. UP's net corporate income was US$1.9 billion in 2009, down from $2.3 billion in 2008, UP spokesman Aaron Hunt said.

As for air cargo, Los Angeles International Airport and Ontario International Airport, collectively, have experienced a 24 per cent drop. The decrease is attributed to the problems in air traffic and the economy.

Furthermore, there were demands for aging infrastructure, including roads, railways and highways, to be replaced.

However, according to Mr Ikharta the state and federal governments don't have the funds. "Frankly, this is going to be a big issue," he said. "It can't all be paid by fees, it needs to be paid by the taxpayers."  
(Source:www.schednet.com)