New logistics hub to open in Lancaster, bring up to 60,000 jobs

SocraticGadfly, says:

We'll see about 60,000 jobs.

First, Alliance ain't going to just lie down while some new boy comes into the territory.

Second, does D/FW really need THAT MUCH warehousing space? I mean, Alliance is less than 40 percent developed.

Besides that fact, in south Dallas/southside suburbs, you have: A. The warehousing space south of I-20 to the west of Hampton; B. The Argent/ProLogis business/logistics park whose first building is now being built, in Lancaster; C. A similar project in Dallas, on Hampton just south of 20, slightly ahead of Argent; D. A similar project in Dallas, I-35 at Danieldale, somewhat behind Argent.

Folks, there's simply no way the area needs all that.

Third, if oil goes over $100/bbl in today's dollars, a number of economists think that's a "tipping point" for folks like WallyWorld to rethink their just in time delivery AND for many of its suppliers to think about how much they outsource overseas -- in other words, to seriously tip the logistics apple cart.

Fourth, if Lancaster continues to have more and more criminal problems... what level of companies will come to a place like the Dallas Logistics Hub?

interestedcitizen, says:

Before I can believe 60,000 jobs, I want to know how much public investment is going to be necessary and over what period. Given us some specific target dates. Let's see both incentive provisions and penalties if the targets aren't made. Let's see the real bottom line benefit in the city's revenues. The bottom line benefit that I want to see see will be a declining tax rate and absolute reduction in the dollar amount of taxes paid per typical household or small business. If households and small business are just going to see rising tax rates and annual increases in dollar amount of taxes paid that exceed the normal rate of inflation, there is no real benefit to the growth.

We've heard these rosy projections before. The golf course was supposed to pay its own way and be delivered to the city at no cost in 25 years. It was supposed to be an ecoomic engine. It never happened. The recreation center was supposed to be self supporting with sales taxes and dues. That never happened. The Bear Creek Nature Park was supposed to be self supporting with private and outside government support. It wasn't supposed to cost the city a penny. It, too, was supposed to be an economic engine. That didn't happen.

When are we going to start making people who want to play public officials for fools start giving us some hard numbers and making promises that stick? When are we going to start making people who make false promises pay the consequences? We've had too much empty rhetoric. Polticians are unbelievable.

Our problem is that we're always on our knees begging a white knight to save us. These white knights haven't saved us yet.

milesi826, says:

Does this remind anyone of the supercollider? Now, THAT WAS A SUCCESS! By the way, where was it? Is this the same developer? Taxpayers in South Dallas County...hang on to your billfolds.

jefmelch, says:

The pretender to Socratic Logic sez: "Third, if oil goes over $100/bbl in today's dollars, a number of economists think that's a "tipping point" for folks like WallyWorld to rethink their just in time delivery AND for many of its suppliers to think about how much they outsource overseas -- in other words, to seriously tip the logistics apple cart. "

If oil goes to over $100 per barrel trucking will be more expensive. And so railroads, river barges, coastal ocean and trans-oceanic freight will regain comparitive advantages.

Which promoters of "inland" ports are expressly and loudly HOPING will happen.

Given sufficiently high trucking costs it will be cheaper to move a shipping container from coastal manufacturing -- in ANY nation -- by water to an ocean port than by rail from, say, Wichita or Amarillo to elsewhere in the U.S. From old ocean ports like New Orleans a natural infrastructure of rivers support inland "logistic hubs" -- as far inland as St Louis up the Mississippi or over the Missouri River to Kansas City. Des Moines might make a comeback.

But Dallas, although founded on the Trinity by an optimist who believed riverboats could navigate the mudflats, is NOT accessable by water. The very next best mode is rail.

So if D/FW is to compete with DesMoines, we're looking at 4 containers per flat car times 100 flat cars per train all moving between port of Galveston, or Houston, to Dallas. Or Wilmer-Hutchins, maybe. Somewhere close. And does anybody suppose that any one customer wants ALL 400 containers in one day? No?

Then there will be a need for one or more D/FW "logistic hubs" to off load the train, transfer some containers to trucks for bigger customers, and transload the contents of some containers into short term storage for smaller customers.

Otherwise the individual customers in retail or manufacturing each and all will have to build their OWN warehouses, and develop a non-core expertise in inventory management, transportation brokerage, barcode, RFID, and radioisotopic routetracing, etc.

Frankly, about the only non-logistics business who CAN do so much warehouse, trucking, technology and brokerage work is run by the heirs of Sam Walton. Everybody else is going to be out-sourcing to logisticians with hubs, like Alliance.

Which will be pretty funny if cheap oil-substitutes come on line...

CastleHills, says:

I was married to a logistics exec, and JefMelch is exactly right when he says this:

"If oil goes to over $100 per barrel trucking will be more expensive. And so railroads, river barges, coastal ocean and trans-oceanic freight will regain comparitive advantages. Which promoters of "inland" ports are expressly and loudly HOPING will happen."

Sorry Gadfly, you don't know anything about logistics.

interestedcitizen, says:

We should all agree with the premise that rail freight is much less expensive than truck freight, and that rail freight comes behind barge traffic when efficiency is measured in terms of fuel burned per unit of freight moved. An advantage of intercoastal barge traffic is that it doesn't take a lot of deep dredging to create waterways. I would think it would be cheaper in the long run to develop and maintain an intercoastal canal than a railway.

The Trinity River canal has been a dream since the day Dallas was born. The I-45 and I-20 bridges built in the 1970s over the Trinity are specifically designed to accommodate barge traffic. Those bridge designs cost extra money. Yet, apparently frequent floods and the cost of development must have made the canal idea unfeasible. That's a huge investment in public infrastructure, fueled by a dream, that has gone to waste.

Money has a time value. Rapid innovation shortens the time within which manufactured goods become obsolete. Chips and circuit boards manufactured in China three months ago might be obsolete by the time they reach an American market. Copiers and printers manufactured six months ago might be obsolete compared to what is now available in the market.

Rail freight, while efficient in terms of fuel consumed per unit of freight, might not be as efficient when time is critical.

This inland port only came to fruition because of the influx of public dollars. The geographic location and the labor were here for years. Before the Logistics Hub can become fully operational, there is going to have to be a massive amount of public investment out there. Just look at the network of roads that haven't been developed.

The difference between the Alliance Hub and the Dallas Hub is that a large portion of the Alliance Hub is in private dollars rather than public dollars.

The question in my mind is whether the Dallas Logistics Hub, by relying more on public dollars than Alliance, is going to engage in unfair competition because its development costs are going to be artificially reduced by the influx of public dollars. Will Alliance and the DLH compete on a level playing field, or will public investment in the DLH simply lead to more public investment at Alliance, leading to the overcapacity we see in so many public projects? Overcapacity is wasted tax revenue. Money spent on excess capacity means less money in the hands of consumers to make truly efficient decisions. We should never have an objective of creating overcapcity.

There is a moral question we also have to consider. We know that almost all of the freight coming up from the port of Houston is going to be Chinese made. We know that Chinese laborers are practically slaves and do not have the right to organize, strike, or collectively bargain. Labor costs in China are kept artificially low partly because of government policy. Because Chinese made goods are cheaper partly because of Chinese government policy, are we not perpetuating that system by, through our public investment, making it cheaper to move those cheap Chinese slave made goods to an American market? In order to compete against Chinese slave labor, will American workers have to become slaves of the manufacturers as well, or are a few well to do American manufacturers going to collaborate with the Chinese government to exploit the Chinese slaves?

SocraticGadfly, says:

Sorry, Castle Hills, but I'Ve read a lot Peak Oil. I didn't just invent that idea out of my head. Several Peak Oil blogs have commented on how oil prices could cause a "logistics tipping point" somewhere above $100/bbl.

Point is, if oil, and gasoline, gets high enough, companies will do less of both trucking AND rail shipping... they'll find it's less expensive to build more stuff locally/regionally.

And you DEFINITELY don't know Jeff Melcher, who has apparently had a personal grudge against me for almost a year, which he conflated with my professional work, calling personal vacation time "gallivanting."

Yes, Jeff, I'll fight fire with fire if you continue to insist on starting the fires in the first place. Doubly so if you want to continue the snide attitude that started with that "gallivanting" comment last summer.