NASCO: North America’s SuperCorridor Coalition
NASCO, the multimodal transportation network running through the heart of trade in the United States, Canada, and Mexico, is all about sustainable, secure, and efficient economic development. See why its future looks so bright.
North America’s SuperCorridor Coalition, Inc.—known as NASCO—represents a 2,500-mile-long, existing multimodal transportation network running through the heart of trade in Mexico, the United States, and Canada, connecting more than 71 million people in commerce and trade.
The NASCO Corridor directly impacts North America’s continental trade flow, supporting $1 trillion in business among the three countries.
Trade within the NASCO Corridor has exploded since passage of the North American Free Trade Agreement (NAFTA) in 1994. In 1993, U.S.-Mexico trade totaled $82 billion. By the end of 2007, that figure hit $350 billion. Pre-NAFTA U.S.-Canada trade was $350 billion, rising to $590 billion in 2007.
“NAFTA trade represents more than one-third of the United States’ total trade with the world,” reports Francisco Conde, director of communications and special projects for NASCO. “It is the fastest-growing part of the United States’ trade with the world, and we have not yet begun to take full advantage of what we can do with our Mexican and Canadian trading partners.”
TAPPING GROWTH POTENTIAL
Recognizing not only the potential for growth, but also the need for improvements and coordination along the NASCO corridor early on, a group of transportation industry players—both government and private sector—formed North America’s SuperCorridor Coalition, Inc. in 1994. Today, the tri-national Coalition promotes research, collaboration, investment, and other activities along the entire corridor. Its membership includes departments of transportation from various states and provincial authorities; business development groups; inland port developers; universities; and other public and private sector entities related to transportation and trade in the United States, Canada, and Mexico.
“NASCO’s strength lies in unifying the public and private sector to take action on the many transportation and trade challenges facing the corridor—principally focusing on how to advance economic development and security through the North American heartland,” says Tiffany Melvin, executive director of the trade partnership.
“NASCO is not just about Interstate 35,” Melvin adds. “NASCO is all about sustainable, secure, and efficient economic development along the existing multimodal transportation system. We represent a great mix of tri-national government and private sector entities working together toward common goals.”
After 14 years of hard work, NASCO has created an environment in which members feel free to share ideas. “We have done a good job of bringing together state and local government agencies, grass roots organizations, and the private sector, and providing an environment where people are comfortable throwing ideas on the table,” says Melvin. “We all recognize that we’re working toward a common purpose. We understand that our countries and our continent must collaborate and cooperate to compete in this global economy.”
To this end, NASCO is concentrating on five major focus areas:
- Economic development—to support funding, maintenance, and improvements to the infrastructure underpinnings needed to support trade flows.
- Technology—to improve transportation efficiency and supply chain security.
- Sustainability—to promote “green” environmental initiatives that improve air quality.
- Knowledge—to link educational institutions along the corridor for collaborative research and development.
- Job creation—to promote a workforce training program in the supply chain and logistics fields.
PROMOTING INFRASTRUCTURE IMPROVEMENTS
While NASCO promotes a commitment to transportation infrastructure improvements on many fronts, one of its most recent efforts is encouraging development of intermodal inland ports.
As coastal seaports become more congested, inland ports have taken on increasing importance in enabling the efficient flow of imports and exports through the mid-continent corridor. To encourage and capitalize on this trend, NASCO established the North American Inland Port Network (NAIPN), a committee tasked with developing an active inland port network along the NASCO corridor to alleviate congestion at maritime ports and U.S. borders.
Currently, the NAIPN committee includes developments at Alliance Texas in Fort Worth; Dallas Logistics Hub; International Inland Port of Dallas; KC Logistics Hub; Port San Antonio; Des Moines, Iowa; CentrePort Canada in Winnipeg, Manitoba; Puerto Interior Guanajuato; Bajio Central Mexico; Interpuerto Monterrey; Proyecto Distrito Multimodal Villa XXI; Durango, Mexico; and Meridian 100° Free Trade Zone at Port Laredo.
NAIPN envisions an integrated, efficient, and secure network of inland ports specializing in the transportation of containerized cargo in North America. It acts to spur job creation and raise public awareness of inland ports’ growing, integral role in economic development and trade.
On the technology front, NASCO is collaborating with the U.S. Department of Transportation and Lockheed Martin Co., SAVR Communications Inc., and GeoDecisions to test advanced freight tracking technologies along the 2,480-mile corridor. The aim of the pilot is to improve supply chain and freight mobility, security, and efficiency while reducing congestion and cost of trade.
Participants and advisors in the pilot project include trucking companies, third-party logistics companies, brokers/freight forwarders, railroad operators, emergency responders, and local, state, and federal governments.
“The program combines RFID readers/scanners, GPS technology, and other software and information networks to enable shippers and authorities to track the flow of containerized cargo along the NASCO corridor,” reports Melvin. “We are looking at the feasibility of a trade corridor management system that places sensors inside containers to monitor temperature change, light, shock, and other condition variables via the Internet.
“The system could tell us, for example, whether a container was opened or tampered with, whether it was dropped and if so, by whom and when,” she adds. “This kind of accountability, visibility, and improved security could save companies a lot of money.”
NASCO is also supporting another pilot project: the Cross-Town Improvement Program (C-TIP) in Kansas City. C-TIP is an effort by the Federal Highway Administration working with industry to reduce unnecessary short-haul truck trips across urban areas.
The project does this by collecting and disseminating information on short-haul freight movements via an Internet portal. Specifically, the portal indicates whether trailers are empty or partially loaded, and serves as a matching service. C-TIP’s first pilot program is taking place in Kansas City, Mo.
Researchers working on C-TIP believe they can reduce unnecessary trips by 38 percent, thereby cutting freight traffic congestion, expanding the capacity of existing transportation infrastructure, and reducing negative fuel emissions from freight movements. NASCO is working with C-TIP to promote the program in other urban areas along its corridor.
NASCO members and staff are collaborating with the U.S. Environmental Protection Agency’s (EPA) Blue Skyways Collaborative (BSC) on voluntary programs targeting improved air quality along the corridor. The Blue Skyways Collaborative was created to encourage voluntary air emissions reduction in North America’s heartland.
NASCO is engaged with BSC leaders along the corridor to develop a new voluntary prototype Environmental Management System (EMS) program specific to inland port operations. The program’s goal is to reduce the environmental impact of inland port operations in the corridor similar in scope to EMS programs the EPA has developed for cities and seaports. NAIPN members also are actively working with the EPA and BSC to develop an environmental best practices checklist for inland ports.
NASCO’s efforts in promoting environmental best practices has attracted the support and backing of the Commission for Environmental Cooperation (CEC) of North America, the Montreal, Canada-based tri-national institution formed by NAFTA partners in an environmental side agreement on NASCO.
A GREEN VISION
The CEC points to NASCO as a leading example of its “Greening the Trade Corridors of North America” vision. NASCO and NAIPN also support the moves by their members and others along the NASCO corridor to adopt emission-reducing certified “green buildings” that meet the highest standards for energy-efficient and environmental design.
“Areas that cannot sustain business or secure investment because they’re not in compliance with air quality standards will be less attractive as a potential site,” observes Melvin. “NASCO views environmental best practices as essential. We have moved way beyond doing something good for the environment just because it’s a good thing to do.
“Our members understand that if we do not pay attention to this issue proactively, we may have a hard time in the future,” she continues. NAIPN, for example, is helping members share environmental improvement efforts and successes to shape national models of best practices.
NASCO’S “KNOWLEDGE CORRIDOR”
The NASCO corridor boasts a rich population of higher learning institutions—universities and research centers that focus on a host of study areas ranging from transportation to life sciences. These institutions include the Kansas City Area Life Science Institute, the Centre for Sustainable Transportation at the University of Winnipeg, the University of Manitoba, the International Institute of the Americas at Laredo Community College, the Instituto Tecnológico de Estudios Superiores de Monterrey, the Center for Transportation Research and Education at Iowa State University, the Center for Transportation Research at the University of Texas, and more.
These research centers have grown into engines for development as they spawn ideas for new products, technologies, and processes.
“As we looked at these resources across the NASCO corridor, we came to the conclusion that we have some extraordinary educational institutes focusing on transportation technology, and that it would be of enormous benefit if we could knit them together,” says Greg Dandewich, vice president and director of economic development for Destination Winnipeg, a NASCO member. “We want to link these programs to eliminate duplication of effort, and to stretch the vision of these centers to cover a larger scope.”
For example, research centers within the NASCO corridor have undertaken a tri-national food project that aims to develop types of food that, with the right combination of ingredients, can positively impact type II diabetes.
“We would not have been in a position to do this kind of collaborative research if we didn’t build it around the mid-continent trade corridor,” Dandewich acknowledges.
Dandewich believes there are many more opportunities like the nutriceuticals project to explore as NASCO develops its knowledge corridor.
“We won’t lose sight of our primary focus—transportation and distribution—but it opens up the doors for a variety of ideas,” he notes. “The goal of our cooperative knowledge efforts is to have our corridor learn things at the same time—to create systematic comprehensive learning.”
At the northern end of the corridor, Canada has been aggressively building its capabilities to support trade. Local, provincial, and national support for a unified transport strategy—particularly as it relates to NASCO trade—has grown tremendously, a fact that pleases Darryl Gershman, vice president and owner of G2 Logistics, a Winnipeg-based third-party logistics provider. This transport strategy aims to strengthen Canada’s participation in both the north-south and east-west flows of trade into and out of the country.
“We need the government to push for and support trade, create incentives, then inspire private sector investment,” says Gershman. “NASCO supports what NAFTA is supposed to be—free and secure trade between Mexico, the United States, and Canada.”
The City of Winnipeg and Province of Manitoba have been particularly active supporters of NASCO. “Manitoba, Winnipeg, and Canada recognize that as a nation we need to develop trade capabilities to meet global supply chain requirements,” Dandewich notes.
THE CENTER OF THE CONTINENT
“Manitoba is at the heart of North America—the geographic center of the continent,” says Andrew Swan, minister of competitiveness, training, and trade for the Province of Manitoba. “We have easy transportation access, and great east-west trade routes. The Canadian National and Canadian Pacific railroads converge in Winnipeg, so the city has long been a major logistics and trading center for east and west flows.”
Manitoba does significant annual trade with the 11 U.S. states along the NASCO corridor. Two-way trade in 2006 totaled $8.9 billion, up 42 percent from $6.2 billion in 1997, the year the province joined NASCO.
“With the passage of NAFTA we find ourselves at the crossroads of growing north-south trade into the United States and on to Mexico,” Swan continues.
Manitoba recently formulated a comprehensive strategy to position the province as a distribution gateway for North America, servicing the mid-continent. Called the Manitoba International Gateway Strategy, the policy capitalizes on the fact that Winnipeg is the only city in Canada that has three major railroads—CN Rail, CP Rail, and BNSF—running through it.
“We’re excited about the Manitoba International Gateway Strategy and NASCO’s promotion of transportation and trade along the corridor,” says Gershman.
Another significant project under development in Manitoba is CentrePort Canada. In September, the Manitoba government introduced legislation—the CentrePort Canada Act—to create CentrePort Canada, a private-sector focused corporation that would develop and promote Manitoba’s inland port. The inland port is a 20,000-acre parcel of land adjacent to Winnipeg’s international airport, and will capitalize on Manitoba’s well-established air, rail, maritime, and road infrastructure.
“CentrePort Canada is an exciting vision we share with Manitoba’s business community, municipal leaders, and others who want to build our province,” says Manitoba Premier Gary Doer. “Its development will allow us to create jobs, attract investment, and take advantage of our prime location in North America.”
“We are pleased the inland port is being developed in conjunction with airport lands,” adds Barry Rempel, president and chief executive officer of the Winnipeg Airports Authority. “Shovel-ready land is available immediately, as is a plan for future phases of fully serviced land. With enhanced roads, rail access, and cargo shipping, we have the assets to move goods to market. And we have access to markets in all directions, from the port of Churchill to Mexico, through Thunder Bay to the east, to the Asia Pacific Gateway via Prince Rupert.”
SUPPORTING THE PORT
Work is underway on a number of initiatives designed to support Manitoba’s inland port, including significant funding for highway upgrades, expansion of Richardson International Airport, and upgrades to the Hudson Bay rail line and the port of Churchill including $48 million from the federal and provincial governments and $20 million from the Hudson Bay Rail Company, reports Transportation and Infrastructure Minister Ron Lemieux.
“We expect the Manitoba inland port to accelerate the flow of goods,” says Gershman. “Many goods coming into ports are destined for mid-continent markets. But port congestion means goods often are delayed. If a container comes into Vancouver full of merchandise for the mid-continent, there’s no sense in it sitting at the port waiting to be destuffed.
“Instead, we will be able to ship the box to the Winnipeg inland port, destuff it there, and move the goods into the market. Companies can save on transportation because they’re using rail versus truck to move inland,” he says.
“We are starting to see a rebound effect on sourcing in Asia,” Gershman observes. “Companies are finding out that it is not always beneficial to move production overseas. The cost to ship a 40-foot container to points in North America has almost tripled in the past five years, and companies have experienced quality problems and delays. Some manufacturing is starting to come back to North America.”
THE FTZ FACTOR
One factor that will draw businesses to the NASCO corridor is a new Free Trade Zone on the Mexico-U.S. border.
Meridian 100°, a privately owned Free Trade Zone (FTZ) developer, will invest $120 million in the first stage of a major FTZ with state-of-the-art logistics infrastructure located at Mexico’s Port Laredo border. The Meridian 100° Free Trade Zone at Port Laredo will be of significant benefit to 3PLs, manufacturers, global traders, and distributors interested in improving operations in the Mexican and U.S. East Coast markets.
The Port Laredo region undoubtedly represents North America’s “logistics heart” for both Mexico and the United States. It constitutes their most important land port and one of the world’s most dynamic borders for goods exchange—almost five million TEUs (equivalent to 45 percent of the trade between the two countries) cross through this region every year.
Robust growth—in the range of 200 to 400 percent by 2020—is forecast for the movement of goods between North America and Asia. This increase in trade will require a competitive infrastructure to allow goods to flow faster and more economically into North America.
LAREDO: A PERFECT FIT
Port Laredo is perfectly suited to handle future trade coming through Mexico from Asia. Through the years, the region has become the primary point of access to the United States. Its multimodal infrastructure network allows global companies’ operations to be more efficient thanks to connectivity with the most important cities in Mexico and the United States.
Conscious about global trends, and aware of value drivers available in Port Laredo, Meridian 100° has decided to invest in the region with a clear objective: to deliver a positive impact in enhancing the region’s competitiveness.
The 2,500-acre Meridian 100° development, located next to the Solidarity International Bridge, will be the first Free Trade Zone on northern Mexico’s border and the only one with 24/7 direct access to the international bridge. The infrastructure will allow global companies to carry out their business in a secure, high-tech environment. Their supply chains will be faster and more predictable, and they will positively benefit from the cost-saving logistics operations and tax procedures that the FTZ offers.
For companies in the retail, consumer products, electronics, technology, automotive, and aerospace fields, and those currently evaluating new site locations, Meridian 100° has brought together a world-class advisory team and is working with them to identify and deliver the benefits of Port Laredo’s Free Trade Zone value proposition, which will improve supply chain operations while delivering cost savings and tax advantages. Companies will also be able to benefit from Mexico’s competitive labor costs.
Meridian 100° will start operations in 2009 and offer land and state-of-the-art facilities available both on a lease basis and as turnkey, built-to-suit designs. The entire Free Trade Zone infrastructure will adhere to energy-saving and environmental sustainability practices.
NASCO has a number of collaborative efforts underway with Mexico. NASCO’s Mexico Committee, established in 2006, consists of public and private sector stakeholders in transportation infrastructure planning and development across Mexico. The committee works to further the NASCO multimodal corridor transportation system’s vision in Mexico.
The NASCO Mexico Committee recently held important planning and policy meetings in Tampico, Tamaulipas, Pachuca, and Hidalgo, with the latter hosting a joint Mexican House of Representatives Transportation Committee National Forum on International Transportation and Logistics. Representatives from all the national multimodal transportation industry companies and public sector agencies making presentations on the status of Mexico’s 2007-2012 National Transportation Infrastructure Development Plan attended the meeting.
NASCO has signed Memorandums of Understanding (MOUs) to serve as an advisory body on the Mexican Ministry of Transportation and Communications’ Inter-Institutional Advisory Committee overseeing the Mexican National Multimodal Corridor Study. The study’s purpose is to determine the nation’s key multimodal corridors for future state and federal investment.
The Mexican Ministry of Trade also has called upon the NASCO Mexico Committee to advise it regarding identification and reduction of key national logistics and supply chain bottlenecks. And in November 2007, the Mexican House’s Transportation Committee and NASCO signed an MOU committing both sides to information exchange and consulting on Mexico’s National Multimodal Corridor Study now underway.
Transportation companies, government officials, developers, and shippers agree that the NASCO corridor has a bright economic future. Collaboration among the three countries has, and will continue to, accelerate growth at levels that far exceed other regions of the world.
“From our perspective as a transportation company, the more we focus on trying to make the entire NASCO north-south corridor flow more smoothly, the better off we will all be,” says Derek Leathers, chief operating officer of Werner Enterprises, Omaha, Neb., one of the largest motor carriers in the United States. “We’re positive on the corridor concept itself, and we believe trade will continue to accelerate on that axis.
“It is encouraging to see the investment in inland logistics parks and transportation infrastructure along the NASCO corridor,” he adds. “Inland intermodal ports such as those being developed in Dallas, Kansas City, and Joliet, Ill., are attracting shipper business.”
Big box retailers, in particular, have embraced the inland port concept. Companies are locating large facilities near these rail hubs to take advantage of more efficient movement of goods. “They like the cost savings and efficiencies associated with being located near an intermodal ramp,” Leathers adds.
With today’s volatile fuel prices, Leathers believes more U.S. companies will look at bringing production closer to home. This makes Mexico more attractive as a manufacturing base. “And as Mexico becomes more attractive, we believe our business will prosper,” he says.
To accommodate this growth, “we must continue to push for reinvestment in our nation’s highway infrastructure,” Leathers says. “Our current highway footprint has existed for more than 50 years.”
Organizations such as NASCO can help make the case for this investment.
SPECIALIZED LOGISTICS TRAINING IN TEXAS
North Texas is recognized as one of the leading intermodal distribution centers in the Southwest and one of the top distribution centers in the North American trading bloc. The region acts as a staging area for truck, rail, and air cargo into the United States, and sits along two central trade corridors. These corridors carry goods from West Coast and Mexican deep-water ports through the Dallas-Fort Worth region and into eastern U.S. and Canadian markets.
Recently, the North Central Texas Supply Chain and Advanced Manufacturing Cluster identified a shortage of qualified logistics workers at both the entry level and more technical intermediate level. To address the problem, the cluster—including Greater Dallas-Fort Worth government and business interests—applied for and won a $1.5-million Department of Labor grant to develop training and certification programs for these two levels of logistics workers.
The training curriculum will be delivered through local community colleges, according to Francisco Conde, director of communications and special projects, NASCO. The two curriculums will be rolled out through the end of 2009.
“NASCO will take the lead in promoting these programs or influencing existing programs tri-nationally along our corridor,” says Conde. “The program fits nicely within our larger knowledge corridor development efforts.”
THE ARDMORE ADVANTAGE
Situated midway between Oklahoma City and Dallas on Interstate 35, Ardmore, Okla., is an ideal location for manufacturing and distribution facilities. I-35, which runs through the west side of Ardmore, provides easy north-south access for travel and shipment of goods to the central section of the United States, as well as to Canada and Mexico.
“Within a 350-mile radius of Ardmore, you can reach more than 12 million people,” says Wes Stucky, president and CEO of the Ardmore Development Authority.
The Ardmore Development Authority is an economic development public trust authority appointed by the City of Ardmore. In addition to marketing and promoting the area, the authority is a major land developer, with four industrial parks, 3,000 acres of land, and about three million square feet of buildings under lease to tenants.
“We are located about 90 minutes from Dallas to the south and Oklahoma City to the north,” Stucky says. “We provide significant cost advantages over those metropolitan areas, further enhanced by the value we offer as a tax-exempt development authority to build, own, and lease facilities to logistics companies.”
Today, some very big-name companies have set up manufacturing and distribution operations within Ardmore Development Authority projects. These include:
- Dollar General Corp., which operates a distribution center that employs 750 associates and serves 1,225 Dollar General retail stores. In 2005, Dollar General completed a $23-million expansion of the facility, its third expansion since opening in 1994.
- Dot Foods Inc., which began operations in February 2005 in its Ardmore Distribution Center. The company purchased the former Best Buy Product Return Center in the New Horizons Industrial Park, and added 60,000 square feet to the 121,000-square-foot building. The Ardmore facility represents a $12-million investment for Dot Foods.
- Best Buy opened its new 750,000-square-foot DC in May, 2004 in the Westport Industrial Park. The building slab is one million square feet and allows for future expansion. The new facility, which replaces a 450,000-square-foot DC, is one of a network of seven large distribution centers within the company.
These and other companies, including Michelin and Circuit City, chose Ardmore because of its transportation access and favorable cost structures.
“With ratification of the NAFTA agreement, we’ve seen significantly increased interest in logistics and distribution capacity in our area,” observes Stucky. “It makes sense to work cooperatively with groups along the NASCO corridor to capitalize on the growth of north-south trade.”