By Dr. William Oliver Hedgepeth
Faculty Member, Transportation and Logistics Management
and Edward J. Bourgeois
Current MBA Student
Recently, the Ports of Indiana received permission to build a sea container terminal on Lake Michigan, according to Agriculture Dive. The new terminal will become part of the first all-water container route for ships serving the Chicago metropolitan area.
What Does This New All-Water Container Route Mean for the Transportation and Logistics Industry?
This new all-water container route in the Great Lakes could lead to numerous long-term social and labor changes in the transportation and logistics industry. Due to its construction, there will be:
- Job displacements and opportunities
- New transportation and logistics employee skill requirements
- Labor relations discussions
- Impacts to local communities
- Regulatory compliance changes
What Transportation Modes and Jobs Would the New All-Water Container Route Affect?
There are five modes of transportation that would be affected from opening this new all-water container route with its shipping lanes. Those five modes are rail, trucking, air cargo, pipelines, and waterborne shipping.
The history of the Chicago transportation and logistics industry has been largely based on rail and trucking operations. But the additional ability to ship grain or liquid cargo containers through the new route could require industry employees to obtain new job skills, such as working with robots and using emerging computer technology.
New Terminals, New Jobs, and Changes to Communities and Compliance
For the new route, new terminals will be built, which would affect both union and non-union employees. There will be potential labor disputes as well as new career opportunities. It is likely that there will also be negotiations regarding wages and the use of robots, robotic and electronic vehicles, and artificial intelligence (AI) assistance to such workers.
One of the most anticipated impacts of the new all-water container route will be the creation of new jobs for local residents. Hopefully, this change will improve the quality of life for communities, but there will also be increased traffic on local roads.
In addition, there will be discussions and changes regarding federal regulations. For instance, U.S. Customs and Border Protection will need to determine how the new all-water container route will impact shipping and transportation laws.
The Global Supply Chain Is Strong, But Has Its Problems from Time to Time
The global supply chain is the most complex system in the world. A host of raw materials, food, beverages, fuels, clothing, and thousands of other items constantly move along various routes in the global supply chain.
But there can be breakdowns within the supply chain, too. Many newsworthy events have documented disruptions to local and international supply chains, including:
- The April 2010 Deepwater Horizon oil spill in the Gulf of Mexico, which impacted the local seafood industry
- The March 2021 Suez Canal obstruction that impeded a major shipping waterway for six days
- The COVID-19 pandemic, which affected transportation and human operations in warehouses, conveying supplies to businesses such as grocery stores and pharmacies, last-mile transportation, and just-in-time (JIT) logistics
- The March 2024 collapse of the Francis Scott Key Bridge, which blocked shipping to and from the Port of Baltimore
- Yemen-based Houthi rebels firing on ships in the Red Sea and impeding shipping routes
However, the global supply chain remains strong. After the Deepwater Horizon spill, for instance, the loss of the seafood in that region was replaced almost overnight with shrimp from Vietnam and other countries.
The global supply chain is so large and complex that one cannot really see it all, only certain parts of it. But the primary benefit of the new all-water container route will be increased shipping efficiency and improved connectivity in the global supply chain.
About the Authors
Dr. Oliver Hedgepeth is a full-time professor in the University’s Dr. Wallace E. Boston School of Business, teaching reverse logistics courses as well as transportation and logistics courses. He holds a bachelor’s degree in chemistry from Barton College, a master’s degree in engineering management from Old Dominion University, and a doctoral degree in engineering management from Old Dominion University. He is a former director of Hedgepeth Transport, LLC, a trucking company based in Chester, Virginia and Anchorage, Alaska. Dr. Hedgepeth was the founding Director of the Army’s Artificial Intelligence Center for Logistics from 1985 to 1990, Fort Lee, Virginia.
Edward J. Bourgeois is currently seeking an MBA with a specialization in logistics, materials, and supply chain management. He holds a bachelor’s degree in business administration and transportation management from the Community College of the Air Force and a bachelor’s degree in transportation and logistics management from American Military University. Edward is a retired Air Force veteran, speaker, coach, and trainer, as well as a certified DiSC trainer and certified DiSC consultant.
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