Experiences in Urban Logistics: Logistics Park in Santiago, Chile

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1 Grant agreement no.: Coordination and support actions (Coordinating) Activity code:sst : Urban freight delivery systems Experiences in Urban Logistics: Logistics Park in Santiago, Chile Belo Horizonte workshop Ricardo Giesen Pontificia Universidad Católica de Chile

2 Outline Overview of Freight Movement and Challenges in Santiago, Chile Regulations and Restriction to Truck Movement in Santiago Government Diagnostic and Priorities Logistics Development Plan Characteristics of the Abertis Logistics Park Project in Santiago Transferability and evaluation of the Abertis Logistics Park Conclusions 2 24

3 Santiago, Chile 3 24

4 4 24

5 Santiago, Chile Santiago s metropolitan region occupies an area of 15,403.2 km 2, which represents 2.0% of continental Chile Population is 6,061,185 inhabitants (40.1% of the country) More than 10 million are concentrated at less than 300 Km from Santiago (> 60% Chilean population) Chile s highest concentration of population and percentage of GDP is in Santiago. As a result, its growth rate is above the national average. Main economic activities: (1) business and finance services; (2) manufacturing industry; (3) commerce, restaurants and hotels. They represent more than 60% of GDP GDP per capita in Chile reached US$14,461 PPP in the year 2009 IMF projects increases up to US$18,000 in the year

6 6 24

7 Barriers to International Commerce Tariffs are not the only barrier to international comerce Some Weaknesses on the Logistics System (2009) - Lack of coordination between operators (truck) Transp. Costs = 4 x Tariffs - Fragmentation of truck industry (1.8 veh/owner) - Logistics was viewed only in terms of costs Fuente: La era de la productividad : cómo transformar las economías desde sus cimientos, BID

8 Map of Santiago 8 24

9 Overview of Freight Movement in Santiago, Chile Road transport accounts for around 88% of national freight transport in 2007, close to 225 MMT (million metric tons) of freight were moved 57% corresponds to movement of national cargo 39% to cargo mobilized towards or from ports, and the remaining 4% to cargo destined for terrestrial foreign trade 60,770 MMT/km were mobilized, only considering movement within national territory Regarding cargo transported by truck: 62% corresponds to national movement, 33% to maritime foreign trade (i.e., road transport to and from ports), and 5% to terrestrial foreign trade itself 9 24

10 Santiago, Chile 10 24

11 Location of relevant industries and commerce Relevant road network of freight transport in Santiago 11 24

12 Regulations and Restriction to Truck Movement in Santiago The main negative externalities, produced by urban cargo transportation in Santiago, can be classified by 5 types: Vehicular Congestion: because it is concerned with vehicles of a bigger size than cars and circulate at a slower speed, especially in turns and acceleration/deceleration cycles at intersections. Accidents: due to their size and weight, the accidents for this type of vehicle are often serious if light vehicles are involved. Acoustic Contamination: because of the motors size and characteristics. Air contamination: due to gas emission and particulate matter, produced by Diesel engines. Pavement Destruction: due to the heavy weight of their chassis these vehicles use for their operation, in comparison to cars or other Light vehicles 12 24

13 Regulations and Restriction to Truck Movement in Santiago Current regulations for freight transport in the city of Santiago aim fundamentally at the reduction of vehicular congestion and environmental contamination. There are restrictions on: Circulation of freight vehicles during specific times, on specific routes; On dimension and weight, Vehicle age and emission levels, There are designated areas and times permitted for loading and unloading, Truck configuration, and On parking

14 Regulations and Restriction to Truck Movement in Santiago PTUS (2001) Measures Cargo vehicles of more than 2 axles and or gross vehicle weight exceeding 18 tons, cannot circulate inside the A. Vespucio ring between 07:30am 10:00am and 6:00pm 8:30pm. Trucks older than 16 years from the year 2004 were prohibited from entering the A. Vespucio ring. Working machines such as forklifts and backhoe loaders cannot move freely through urban roads in the MR unless they are performing their normal operations. These machines must be transported by cargo trucks

15 Characteristics of the Abertis Logistics Park Project in Santiago Located inside the ENEA business complex 2.2 Km from the Santiago s, AMB International Airport (SCL) With direct access to: Costanera Norte Vespucio Express Total area of 632,810 m 2, and will house 327,798 m 2 of warehouse space for rent and 13,056 m 2 for services 15 24

16 16 24

17 Surface Area of the Abertis Logistics Park in Santiago 17 24

18 Surface Area of the Abertis Logistics Park in Santiago 18 24

19 Initial Project Layout 19 24

20 Picture of the Abertis Logistics Park in Santiago 20 24

21 Picture of the Abertis Logistics Park in Santiago 21 24

22 Picture of the Abertis Logistics Park in Santiago 22 24

23 Conclusions: Transferability A logistics park acts as an instrument of territorial arrangement, through the integration between the land and the city. In this case the construction of storage technology and security systems have been proven able to be replicable and transferrable from Spain to Chile. We think that this project is transferable; to the extent that the location has good accessibility, connectivity, and proximity to the main cargo terminals and populated centers. This requires a good location and good infrastructure (road, rail and air). Since a logistics park is a long-term investment, for a international logistic operator is critical to have economic, political and jurisdictional stability wherever they invest

24 Conclusions: Characteristics that Help The existence of restrictions to truck movements inside the city, which encourage a logistics park, in which cross-docking and consolidation of cargo in and out of the city can be accomplished, thus reducing transportation costs. The existence of many warehouses nearby, such as in the ENEA business and industrial complex, so that truck carriers have more opportunities to consolidate and/or balance their loads when moving cargo in or out of the logistics park. Economic growth and the development of the logistics sector are important ingredients in the success of a logistics park. This project is in its initial stages and still has to gain acceptance among the local operators, who tend to prefer owning its warehouses and/or rent spaces on cheaper alternatives

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