Competitive Strategy for the Proposed Texas High Speed Rail Project: a System Dynamics/ CLIOS Process Approach
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Competitive Strategy for the Proposed Texas High Speed Rail Project: A System Dynamics/ CLIOS Process Approach by Takafumi Hidema M.S., Advanced Energy, University of Tokyo (2010) B.E., Aeronautics and Astronautics, University of Tokyo (2008) Submitted to the Institute for Data, Systems, and Society in partial fulfillment of the requirements for the degree of Master of Science in Technology and Policy at the Massachusetts Institute of Technology June 2017 © Massachusetts Institute of Technology 2017. All rights reserved. Author.................................................................................................................... Institute for Data, Systems, and Society 12 May 2017 Certified by............................................................................................................ Joseph M. Sussman JR East Professor, Emeritus Civil and Environmental Engineering and Engineering Systems Thesis Supervisor Accepted by........................................................................................................... Munther Dahleh William A. Coolidge Professor of Electrical Engineering and Computer Science Acting Director, Technology and Policy Program Director, Institute for Data, Systems, and Society 1 2 Competitive Strategy for the Proposed Texas High Speed Rail Project: A System Dynamics/CLIOS Process Approach by Takafumi Hidema Submitted to the Institute for Data, Systems, and Society on May 19 in partial fulfillment of the requirements for the degree of Master of Science in Technology and Policy Abstract The Texas High-Speed Rail (HSR) is an unprecedented US project proposed by a private company. This project has many uncertainties because it will be funded only by the private sectors and it is the first US HSR project using foreign technology. The HSRs are huge and complex systems involving political, economic and sociotechnical issues that are affected by and affect various stakeholders. Therefore, it is necessary to grasp the “whole picture” of the project to plan effective strategies to make it successful. The objective of this thesis is to identify how we can improve the system performance and propose recommendations to guide the project toward success. The CLIOS Process is applied to identify the current circumstances surrounding the project. Comparative study of HSR with other transportation modes and market analysis are conducted to identify competitive advantages of the HSR system and how to utilize these advantages to compete with other transportation modes. After these qualitative analyses, pricing strategy, capacity management and accessibility management are identified as the three “key factors for success.” Based on the results, the System Dynamics (SD) approach is applied. Conceptualization of the HSR system by causal loop diagrams (CLDs) clarifies several feedback interactions between key variables, such as ridership, load factor, total travel time and fares. Then, the numerical SD model is created to conduct quantitative analysis over time. Sensitivity analysis for each policy parameter suggests how the HSR operator could improve system performance by implementing different strategies in the short to long run. Thesis Supervisor: Joseph M. Sussman Title: JR East Professor Emeritus of Civil and Environmental Engineering and Engineering Systems 3 4 Acknowledgement In September 2015, when I started my life at MIT, never did I believe that I could finish the entire intensive curriculum that I never experienced before. I reflect on how quickly my two years at MIT have passed, and before finishing this Master thesis, I should thank all of the people who encouraged and supported me to complete this wonderful program at MIT. First and most importantly, I would like to express my deep gratitude to my research advisor, Professor Emeritus Joseph M. Sussman. It was especially a tough time for you to supervise students during a long period of medical treatment after your surgery. Nevertheless, you always gave me kind support and had zeal to guide me to conduct high quality research. It was a precious opportunity for me to study under your supervision. This experience made me confident to pursue my career in the transportation area. Thank you very much, Joe. I would like to appreciate members in R/HSR research group. Joanna Moody, thank you for taking your time to help me structure the thesis outline, and give me lots of insightful feedbacks to improve my thesis in terms of the CLIOS Process. I could not have finished my thesis without you. Kenji Chigusa, thank you for taking your time to intensely discuss my simulation results from the viewpoint of the actual rail operator. Current members, Scott Middleton, Rakesh Sridhar, Daniel Mascoop, and recent graduates, Rebecca Heywood, Patton Doyle, Tatsuya Doi, and Ryota Yasutomi, thank you for giving me your insightful opinions to improve my research. Thank you, staff members of TPP, Ms. Barbara De La Bare, Mr. Ed Ballo, and Dr. Frank Field. Your two years support was essential for me to complete this intensive program. And classmates of TPP’ 17, you made my time at TPP valuable and stimulating. I would like to express my gratitude to Central Japan Railway to give me the chance to expand my horizon from Japan to the world. I will give back to you by contributing to your development. Finally, I would like to say thanks to my wife, Mariko. You always encouraged me to pursue my career at MIT. I am glad that finally both of us could earn master degrees, from Boston University and MIT. You made my life in Boston an irreplaceable time. Takafumi Hidema May, 2017 5 Table of Contents Abstract ................................................................................................................................................... 3 Acknowledgement .................................................................................................................................. 5 Table of Contents .................................................................................................................................... 6 List of Figures and Tables ....................................................................................................................... 9 Chapter 1: Introduction ......................................................................................................................... 13 1.1 Motivation .................................................................................................................................. 13 1.2 Research Objective ..................................................................................................................... 14 1.3 Thesis Outline ............................................................................................................................. 14 Chapter 2: Overview of High Speed Rail Projects in the US ............................................................... 16 2.1 Background ................................................................................................................................. 16 2.2 Pros and Cons for High Speed Rail Projects .............................................................................. 17 2.3 Public High Speed Rail Projects ................................................................................................. 19 2.4 New Movements from Private Sectors ....................................................................................... 21 2.5 Conclusion .................................................................................................................................. 22 Chapter 3: Overview of the Texas High Speed Rail Project ................................................................. 23 3.1 Background ................................................................................................................................. 23 3.2 Summary of the Texas High Speed Rail Project [30] ................................................................. 27 3.3 Main Actors of the Project .......................................................................................................... 30 3.4 Key Technology and Selection of the Route [34]....................................................................... 30 3.5 Challenges .................................................................................................................................. 33 3.5.1 Procurement of Very Large Initial Cost .............................................................................. 33 3.5.2 Opposition from Landowners and Inhabitants .................................................................... 34 3.5.3 Technical Barrier ................................................................................................................. 34 3.5.4 High Ratio of Car Ownership and its Trend ........................................................................ 35 3.5.5 Profitability.......................................................................................................................... 36 3.6 Conclusions and Questions ......................................................................................................... 37 Chapter 4: Application of The CLIOS Process to the Texas HSR project ........................................... 38 4.1 Overview of the CLIOS Process................................................................................................. 39 4.2 System Representation of the Texas HSR Project .....................................................................