Contents 1. Introduction 3 2. Role of Freight 4 3. Existing Conditions / Current Issues 5 4. Aspirations for Tees Valley Freight Network 21 5. Interventions 22 7. Action Plan 25 2 Draft Freight Implementation Plan 1. Introduction Tees Valley Combined Authority is the local transport authority for the Tees Valley. This is the Tees Valley Freight Implementation Plan, part of the first Strategic Transport Plan for the region, for the period up to 2029. It has been developed by the Combined Authority in collaboration with our five constituent Local Authorities, Darlington, Hartlepool, Middlesbrough, Redcar & Cleveland and Stockton-on-Tees. The Combined Authority has ambitious plans to grow the region’s economy and our Strategic Economic Plan aims to create 25,000 Our vision for new jobs and deliver an additional £2.8billion into Tees Valley by Tees Valley is: 2026. We are also developing a Local Industrial Strategy, an agreement between us and the Government on how we will To provide a high improve our economy over the next ten years and how this will quality, clean, feed into the Government’s overall UK strategy. quick, affordable, reliable and safe In order to ensure that everyone in Tees Valley is able to work, transport network study, enjoy and fully participate in these ambitious plans for the for people and future, we need a world-class transport system that also encourages inward investment. Transport is about connecting freight to move people and businesses in Tees Valley and beyond. Delivering a within, to and from world-class transport system that is fit for the future is a critical Tees Valley. enabler for the success of the area. In preparing the Strategic Transport Plan, a framework was developed based upon six themes, which are closely linked and will all require improvement in order to meet the overall transport vision for the Tees Valley. The six key themes are: National Rail. Major Roads. Connecting Economic Centres. Unlocking Key Sites. Local Journeys. Deliver Social Equality and Protect and Enhance the Environment To support the Strategic Transport Plan itself, a series of Implementation Plans have been prepared which go into more detail on the current and future issues, and the interventions needed, across the six themes listed above. This Freight Implementation Plan aims to recognise the contribution that the sector makes to economic growth, puts forward proposals to support freight and logistics, whilst examining any negative social impact associated with growing freight movements and proposing mitigating measures. The strategy considers the activities of all modes of freight transport and complements the other daughter documents, particularly the Road and Rail Strategies. As with the Strategic Transport Plan, we are looking for feedback on this supporting document, before it is finalised towards the end of 2019. Please visit our website to provide your input. www.teesvalley-ca.gov.uk/consultations Draft Freight Implementation Plan 3 2. Role of Freight The freight and logistics sector has a key role to play in delivering the Tees Valley Strategic Economic Plan. The freight sector is a key enabler in terms of investment, jobs and economic wellbeing. The efficient movement of goods is vitally important for economic success, as it allows the raw materials and finished goods that we manufacture to reach their destinations. Any improvement in efficiency offers a significant opportunity for economic growth through increases in productivity. The freight industry lies almost entirely in the private sector, which makes significant economic investments each year and which provides industry, commerce and the wider population with a level of service that generally does not rely on public sector investment. Logistics is a highly competitive and commercially driven sector which operates in a global marketplace where low operating margins are not uncommon. There is little security of business and many operators carry freight on a ‘spot’ basis, that is, as and when required. The sector requires high levels of investment in both infrastructure and equipment, largely on a speculative basis, and in markets that are vulnerable to external factors such as shifts in trade, competition, government policy and fuel prices. The sea freight and rail freight sectors in particular are based on significant capital costs and long asset life. Ship and freight train operators require significant third party infrastructure and a critical mass of tonnage to underwrite the cost of providing a service. Similarly, port and terminal operators who provide that infrastructure have to plan long term investment in a sector that operates in a very dynamic marketplace. The Tees Valley is an important link in the UK’s supply chain, providing an international gateway for the movement of goods in and out of the country and a key hub for the transport of domestic freight. We are proud to have one of the UK’s biggest port complexes and England’s largest exporting port as part of our transport infrastructure, an international airport, and a network and road and rail routes which give the City Region good access to national and international transport links. The A1(M) and A19 provide north-south links, and the A66 and A174 east-west road links. In terms of rail, the Tees Valley network provides both passenger and freight connections, with direct routes to London and other major cities. Darlington’s railway station is located on the East Coast Main Line and provides rail connections southwards to London and northwards to Glasgow and Edinburgh in a little over two hours. Teesside International Airport offers flights to a number of UK destinations and Schiphol, Amsterdam. 4 Draft Freight Implementation Plan 3. Existing Conditions / Current Issues Overview Efficient logistics requires a comprehensive freight transport network where all modes work together effectively for the benefit of the industry and the local area. In the Tees Valley there are 555 enterprises classified as ‘Transportation and Storage’, employing 16,500 people (Source: ONS Business Register Employment Survey). For its size and location within the UK, the Tees Valley punches above its weight, particularly in terms of exports. Local port facilities on the River Tees export more than any other port in England and Tees Valley exporters have the highest value per exporter of goods in the country. The dominance of large companies exporting machinery and chemicals reflects our strong manufacturing sector. Data for the ports of Tees and Hartlepool shows that we are operating within a global, deep-sea market and handling a large range of commodities including both raw materials and finished goods. By road, the single biggest area of freight for Tees Valley is food products, pushing the movement of chemicals into second place. The greater than national average length of haul for the Tees Valley suggests that the City Region’s freight hinterland is actually wider than that for other areas. Freight by rail is still dominated by large, bulk movements serving major industry in the area. However, the daily intermodal services to Scotland, the south and east of England extend the Tees Valley hinterland further and suggests greater potential for the port to act as a UK gateway for imported consumer goods if rail, together with good road access, provide a cost- effective and resilient point for onward distribution. Key statistics relating to freight in the Tees Valley include: 16,500 people employed in the sector; 825 logistics companies located in the City Region; Home to the 9th largest port in the UK; and The sector contributes £533 million of Gross Value Added (GVA) to the City Region’s economy each year. Draft Freight Implementation Plan 5 Key Strengths Deepest port facilities on the east coast with open access to the sea Good availability of brownfield sites Enterprise Zones Main freight sites connected by good road and rail infrastructure Relatively uncongested roads and economic centres Long-established daily rail and sea connections for shipping containers Extensive pipeline network for liquid bulk movements Supportive planning regimes Major industrial cluster and key manufacturing sites Strong supply base for exports Competitive rates for land, warehousing and road haulage A local airport with proximity to main freight sites Almost half of the UK population is within a 4.5 hour drive for a lorry Road Heavy Goods Vehicles are defined as goods-carrying vehicles with a gross vehicle weight over 3.5 tonnes while Light Goods Vehicles are essentially vans with a gross weight of 3.5 tonnes or less. In 2006, there were just over 4,600 HGVs registered in the Tees Valley City Region. By 2015, this had reduced to just over 3,600 whilst the number of Light Goods Vehicle (LGV) registrations has increased from just under 3,000 to almost 74,000. This decline in the number of HGVs registered in the Tees Valley reflects the national picture. There has been a significant move nationally towards a greater number of light vans delivering goods to the marketplace and vans are now the fastest growing element of the road freight sector. Local data on road volumes confirms a decline of HGV traffic and a rise in LGV traffic. HGVs vs. LGVs Tees Crossing (Indexed = 100) 170 160 150 140 130 120 110 100 90 80 70 60 50 40 30 2000 2002 2004 2006 2008 2010 2012 2014 2016 LightGoodsVehicles AllHGVs 6 Draft Freight Implementation Plan Despite the decline in the number of registered HGVs, they continue to be an integral part of the supply chain and it has been estimated by the Road Haulage Association that “85% of everything we eat, wear and buy and use is moved, at some point, on the back of a UK- registered lorry”. The type and weight of HGV carrying goods is, however, changing with a growing number of goods now carried by larger articulated lorries and a shrinking demand for smaller, rigid vehicles.