New York’s $40+ Million Short Sea Shipping Prize
A perfect storm of new challenges and spiraling cost for truck drivers in New York City has resulted in a tsunami of political support for Short Sea Shipping (SSS) initiatives to move cargo off trucks and onto local waterways. In just the past six months government officials in New York have pledged highly valuable waterfront land, over $40M in grant money and permits to any company that can make SSS work. But can a solution be found?...MORE
Industry stalwarts like 150 year old McAllister Towing, Harley Marine Services, Red Hook Terminals and Weeks Marine believe that new economic pressure on trucking and government grant money will soon make small container-based barge services profitable but new, innovative, maritime startups are emerging with new ideas.
Three new companies – gShip, Blue Line Logistics and Harbor Harvest – are sprinting to meet grant deadlines and sign-up customers and they share one important trait, all three will move freight without containers, rather, they will focus on a much smaller standardized unit; shipping pallets.
To understand the new opportunities in New York we first need to answer two fundemental questions:
Why is the cost of trucking in New York escalating at such a rapid rate?
Why are the newest, smallest and most innovative short sea shipping companies not using shipping containers?
City Congestion – The Perfect Storm
Our nations highways are at a critical stage. Containerized shipping, extremely efficient at moving cargo across oceans, onto trucks, and over our nations interstates, has pushed our roadways to maximum capacity. Congestion at critical bottlenecks has reached a breaking point, especially in cities. Large trucks do not move well through local streets. They sit all day in traffic, delaying deliveries, polluting the atmosphere and getting into accidents.
Pollution and accidents come with high costs too. New emissions requirements coupled with electronic safety devices and driver monitoring have doubled the cost of purchasing a truck. Drivers can no longer get away with illegal overtime exacerbating a nationwide driver shortage.
New roads can not be built because transportation budgets are already strained repairing existing infrastructure, repairs that are compounding the problem with road closures throughout the transportation network. In 2018 congestion costs topped $4.9 Billion in the NY/NJ metro area. A demographic shift to urban areas, and an increase in online shopping mean these problems will only get worse.
There is, however, a catch. Not all of our nations highways are congested and many highways, especially those moving long distances East and West, experience little traffic. The most critical problem areas are for trucks moving in and around cities or through traffic choke points like New York’s George Washington bridge. Moving cargo short distances around these choke points could solve the problem but container handling time and slow tug speeds make short moves less effective.
Regulations
“Five years ago government regulations made short sea shipping difficult in New York” said Andrew Genn – NYCEDC SVP of Ports & Transportation – at a SSS conference last year. “We are now working to support rather than block SSS activity.”...
