Assessing transportation infrastructure impacts from supply chain restructuring for increased domestic production of critical resources

Abstract

Contrary to past sentiment for globalization in manufacturing and production, the United States (U.S.) and other nations have shown a strong desire for increased domestic manufacturing and production, especially of critical products. While the benefits are many and include increased national security, increased local jobs, greater earnings and improved economies, the costs to support expanded local or regional production capacity may be nontrivial and extend beyond capital investments. That is, there are social costs for a region and nation that should also be considered. This paper proposes an analytical framework and related mathematical procedures for assessing the impacts of supply chain restructuring and domestic capacity expansion needed for increased domestic manufacturing and production on the operation and maintenance of a nation’s roadways. The impacts are given in terms of added traffic congestion, roadway maintenance costs, fuel consumption, emissions and traffic incidents as a function of estimated added domestic truck loads and truck miles required for expanding domestic production capacity. The framework exploits concepts from the mathematical formulation of multi-commodity, multi-echelon, fixed-charge facility location problems. It was applied in a case study involving increased N95 filtering facepiece respirator (FFR) domestic production within the U.S. This application predicts notable impacts due to an increase in U.S.-based N95 FFR production, with sizable impacts stemming from local raw materials and middle products transportation needed to support increased domestic production. Thus, the case study shows the importance of considering the impacts of increased domestic manufacturing and production on infrastructure and the need for the proposed framework and methodologies. The analytical framework has broad utility and can also be used to compare facility siting proposals, as well as localization and regionalization strategies.