Transportation: Trade’s Conveyor Belt



Transportation-related embedded markets need change to happen with responsible caretaking.

Railroads in the United States have lower rates of accidents versus trucking in the transportation industry. BNSF Railway of Fort Worth, Texas, is the product of 390 separate railroad lines, merged or acquired, over 160 years of railroad history. Railroad lines have a significant and early history in technology, are extremely efficient in terms of energy use, and still play a central role in the U.S. economy. Early this year, BNSF announced its capital expenditure plan for 2017 as approximately $3.4 billion. Union Pacific and BNSF are the largest railways by network size and revenue in 2016, followed by CSX, Norfolk Southern, and two Canadian railway companies.

Figure 1: A BNSF train moves at high speed near Abo Canyon in New Mexico. A BNSF train can haul one ton of freight 500 miles on one gallon of diesel fuel. (Credit BNSF Railway.)

Figure 1: A BNSF train moves at high speed near Abo Canyon in New Mexico. A BNSF train can haul one ton of freight 500 miles on one gallon of diesel fuel. (Credit BNSF Railway.)

Safety and reliability are primary goals of BNSF. The major component of BNSF’s plan for 2017 is to maintain or replace BNSF rail network at a cost of about $2.4 billion. Other expenses in 2017 include $400 million for expansion projects, $400 million for locomotives and other equipment, and $100 million for positive train control [1]. Railroads are integral to the economies of North America. Would transportation survive changes to NAFTA?

According to the Union Pacific website, NAFTA, which went into effect in early 1994, generates about 200,000 export-related jobs. NAFTA could use some modernization, but the agreement has also positively affected the U.S. by recognizing, formalizing, and enhancing trade that was already robust between Mexico, the U.S., and Canada. After more than two decades of building trade and entanglements, three economies would suffer without responsible caretaking. Pruning or fertilizing may be in order, but eradicating the NAFTA tree would be difficult without affecting everyone. The roots of trade nurtured by NAFTA exist in the transportation industry. Transportation is North America’s conveyor belt for trade.

The electronics industry is also tied to the transportation industry via positive train control systems, digital signage, safety, monitoring, and in many other areas. Economic growth is directly reflected in the transportation industry. As our economies grow, we see this growth infused into transportation-related embedded markets as well. Industry should not sit idly in a position of comfort, never embracing change. However, change in a positive direction is welcome, and NAFTA, despite the initial FUD (fear, uncertainty and doubt) in the mid 90s, was and still is a win-win-win when looking at the total picture.

The transportation industry that began in earnest with the railroad dates to Abraham Lincoln kicking it off with a signature in July, 1862. After more than a century of effort, let’s be mindful of what transportation means to life as we know it and recognize what makes trade seamless between three large nations.

References

  1. https://www.bnsf.com/news-media/news-releases/capital-investments-2017.html
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