February 4, 2025 • 41 mins
Tariff risk has forced many companies to take a long hard look at their supply chains. In this Talking Transports podcast, Didi Caldwell, CEO and president of Global Location Strategies and America’s factory whisper, joins Lee Klaskow, Bloomberg Intelligence senior transportation and logistics analyst, to share her insights into what it takes for an industrial-development project, which are key for long-term railroad carload growth, to get off the ground. Caldwell also discusses how she spent the first half of her career moving companies out of the US and the second half helping them move back.
See omnystudio.com/listener for privacy information.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:08):
Hi everyone, This is Lee Clasgow when We're Talking Transports.
Welcome to the Bloomberg Intelligence Talking Transport Podcast. I'm your host,
Lee Klasgow, Senior Freight transportation logistics Analysts at Bloomberg Intelligence,
Bloomberg's in house research arm of almost five hundred analysts
and strategists around the globe. Before diving in a little
public service announcement, your support is instrumental to keep bringing
(00:28):
great guests onto the podcast like the one we have today.
If you haven't already, please do take a moment to
follow rate and share the Talking Transports podcast with your friends, family,
and colleagues. We really do appreciate your support. I'm really
excited to have with us today. D D. Calwell, President
and CEO of Global Location Strategies, a leading site selection
(00:51):
and incentive negotiation firm for manufacturing and industrial companies. D
D is one of the world's most authoritative site and
instead of negotiations expert with more than two decades of
experience in the industry, and she's been dubbed America's factory
Whisperer by Bloomberg News. As President and CEO of Global
(01:12):
Location Strategies, Dede's focus is her company's mission to match
companies and communities for mutual, sustainable prosperity. Under her leadership,
GLS has become a world leader in site selection and
incentive negotiation services and has been named to INK five
hundred Fastest Growing Companies list twice. She's a proud member
(01:35):
of the Site Selection Guild, the only association of the
world's foremost professional site selection consultants. Deete was the first
female chairperson of the organization has held various leadership roles,
currently serving as chair of the Ready Sites Initiative. She
holds a bachelor's degree in architecture from Clemson University and
(01:56):
an International NBA from the University of South Carolina's Darla
Moore School of Business. Welcome to the podcast, Didie. Thanks
so much for being here.
Speaker 2 (02:06):
Thanks so much for having me. Great to be here.
Speaker 1 (02:08):
And so the first question, are you more of a
Tigers fan or or a game Cocks fan?
Speaker 2 (02:13):
My blood run at the Orange, for sure. So I'm
a Tiger fan. I pull for the game Cocks when
they're not playing Clemson, but otherwise I'm diehard Clemson.
Speaker 1 (02:23):
All right, all right, good Tigers. So you know, in
the introduction, I kind of briefly said what GLS is
all about. Can you give us a little background about
the organization that you lead for us?
Speaker 2 (02:36):
Sure, So we're based in Greenville, South Carolina, but we
have a presence in three continents Europe and in South
America as well, and for about seventeen years we have
been offering location strategy services, primarily to mafactoring clients that
are looking to where they place plant, property and equipment
(03:00):
and people around around the globe and how they do
that by optimizing their return on investment for their shareholders.
We also do some consulting work for states, communities, railroads,
electricity companies that are trying to be more effective in
recruiting jobs, capital investment, and load to their locations. We've
(03:22):
got about twenty folks on staff. We've grown very very
rapidly since COVID. It's been a lot of frothiness in
the in the market, and through that and also through
the development of some technology that we've done, we've really
been able to capitalize on that and grow in a
pretty pretty nice clip. So very very difficult to keep up,
(03:46):
but it's been a wild ride, I.
Speaker 1 (03:49):
Bet, and one of the reasons you know why, I
wanted to have you on. You know, I heard you
speak at csx's investor day last year. And also, you know,
the railroads in order for them to row, they're really
focused on an industrial development, and that's really where you
come in and where your firm comes in. So I
thought it was a great kind of learning experience for
(04:10):
people that are looking at railroads and trying to figure
out how they're growing, because you're really bringing together, if
I understand your business correctly, you know the railroads with
the companies that are looking to grow into new sites
or I guess regions that are looking for economic development.
Speaker 2 (04:29):
Yes, that is that is correct. So a lot of
black clients require rail service, either direct rail or trans
modal or intermodal or transload.
Speaker 1 (04:41):
And so.
Speaker 2 (04:44):
There's not there's a limited number of properties that have
that capability, and so our clients are really looking for
the optimal location that they can put their assets, and
it's based on really three things, cost, quality, and risk.
So if they are going to build a manufacturing facility,
and a lot of my clients the projects are anywhere
from one hundred million to many billion dollars in investment
(05:09):
in order for them to be able to do that,
they need to understand that they're going to a location
that is ideally the lowest cost both on investment and
operating costs. So from a logistics standpoint, you're looking at,
you know, where is it easiest to bring the rail
and where can I minimize on my freight cost the
highest quality, So maybe related to rail transport, it's how
(05:31):
good is the service, how good are my connections? Am
I own a direct mainline to my main customer or
my main supplier. Those are all quality factors, and then
risk moving forward. So those might be natural disaster risks,
they might be risk to my schedule, to my budget,
to my ability to operate now into the future. And
so if we can help them find the location that
(05:53):
optimizes on all three of those, then it's a relatively
easy choice. But like in life, a lot of things
are not so cut and dry, and so my job
is to really help them understand what those trade offs
and make the decision that is best for their operation
moving forward. You know, these are generational investments. So if
(06:14):
you're thinking about putting hundreds of millions of dollars into
bricks and mortar and machinery and equipment, training, hundreds of people.
In order to get a return on investment, you have
to run that facility out of profit for a really
long time. And so these are high stakes decisions with
lots and lots of variables to take into account, and
(06:36):
at almost every step there's a potential pitfall. So we
help them navigate that as best we can.
Speaker 1 (06:43):
And most of your customers, I guess the market you
serve are mostly manufacturing and industrial. Is that fair to say?
Speaker 2 (06:51):
That is correct? So we do some warehouse and distribution,
but mainly for our manufacturing clients. We also do data centers,
which is not manufacturing, but it is very capital and
energy intensive. And then we're also quite active now on
energy generation. So back in the late nineties early two thousands,
(07:12):
I did a lot of projects that were merchant combined
cycle gas plants, and with Enron and that fiasco, that
sort of fell out of favor. But with the availability
of cheap natural gas and also the spiking demand for electricity,
those projects have come back in vogue. So I'm working
on probably half a dozen of those across the US
(07:34):
right now.
Speaker 1 (07:35):
Okay, And so like just curious, so how long does
it take to get a deal done in your business?
Speaker 2 (07:41):
It really varies a lot of it. Typically we can
move faster than our clients. It's quite common that companies
will call me up and say I need a site
you know, tomorrow or even better yesterday, and so we
can move really quickly. I guess one really good example
was Noveallas and their elumited rolling mill. They had narrowed
(08:05):
down to a site a few years ago, I think
this was in twenty twenty one, and there were some
issues associated with the site, so they asked us to
develop a Plan B and to look at alternative sites,
and they caught us in February and announce the project
on the Plan B site in Baldwin County, Alabama in
May of that year. So that is a lightning lightning
(08:28):
fast three months or something like that. More typically, it
would take us, let's say four to six months to
identify the primary and alternate sites, and we usually like
to have two that we're considering, just to avoid exactly
what Novellas encountered. It takes us four to six months
(08:49):
to identify the primary and alternate site and the location,
and then anywhere from six to twelve weeks or as
long as the client wants to take to do the negotiatations,
the due diligence and announce the project.
Speaker 1 (09:03):
And most of the deals that you work on are
they for sites that already have facilities and infrastructure in place,
or these kind of like greenfield brown field kind of
transactions that you mostly work on.
Speaker 2 (09:16):
Yeah, So I would say small percentage of the projects
that we do or existing buildings. I think we're a
little bit different than the market from that standpoint because
many companies are small enough and their manufacturing processes are
generic enough that they can go into existing buildings. Most
(09:37):
of the projects that I work on, the buildings are
really built for that particular purpose. So if you're talking
about paper machines or you know, furnaces for glass insulation,
I mean, these are not buildings that you're going to find. Ideally,
they would be sites that are they might still be
considered greenfield, but they are in an industrial park or
(09:59):
in an area where there has been a lot of
due diligence and the utilities and the infrastructure have been
brought to the site. In some cases, we're able to
go into ground fields, not so much into existing buildings,
but perhaps there was an old you know, textile plan
or even a close coal fired power plant adjacent and
(10:20):
it already has a lot of the utility infrastructure there.
That's a win win for everyone because you're not taking
a green field property out of service, and you also
have oftentimes faster development schedule and lower costs and less
environmental risk if you're going into something that's already already
(10:42):
approved and built as and as in.
Speaker 1 (10:44):
Place, right and if you're starting from scratch where maybe
they you know, as you mentioned, like, the infrastructure is
already there. How long does it take from the time
that you suggest the site to a customer until the
customer is whatever they're doing, either they're manufacturing widgets or
what have you.
Speaker 2 (11:05):
Typically, for a large manufacturing project, particularly bits process related,
you're probably going to need a year or so for
engineering and design and permitting. Many of these are require
major air permits, and so that often takes somewhere between
six months and a year or even longer. So, and
(11:27):
then you've got to do construction, which you cannot start
construction often times until you have your airpin permit, and
that often takes twelve months. So it's really anywhere from
twenty four to thirty six months from the time that
they they break around or the time that they announce
the project and start you know, detailed engineering and permitting
for that site and when they start the facility.
Speaker 1 (11:49):
Yup, So you mentioned permitting. There's a new administration in town.
They are really yeah, I heard from why. I understand
they're a little more pro business than previous administrations. And
you know he happens to be a develop developer as well.
(12:10):
So what what what is that going to do for
your industry? Are you guys like expecting that the time
to you know, build something is going to be cut
significantly because of the new administration or it's not going
to be that dramatic of a change.
Speaker 2 (12:27):
It's a little bit hard to say. On the air
permitting because there are there is a there are legal
statutes that have certain time requirements, and the air permitting
is almost entirely delegated to the states from the e
P A.
Speaker 1 (12:40):
Can I ask a dumb question? Air permitting means is
what like air quality?
Speaker 2 (12:45):
Air quality? So if you have emissions associated with your
with your operation, there criteria pollutants like socks, sulfur, dinoxide,
nitros dioxide, zone, et cetera. And so there's limits on
what you can do, and if you depending on what
your emissions are, you have to get a permit, and
(13:05):
your classification of your permit is determined by how much
of those permit those pollutants you have and whether or
not you're in an area that is air quality attainment
basically is in an area that meets the standards by
the Clean Air Act, So that determines what kind of
permit and how long it's going to take, and whether
or not you have to buy credits. So I don't
really think that that is we're going to see any
(13:27):
major changes there immediately. Where I'm don't have to assume
that we're going to see changes because we experienced this
the last time that Trump was in h was in
the presidency was with the Core of Engineers and what
is considered the waters of the US. So we were
working on a project in Arkansas and we're going through
(13:49):
due diligence and we literally had our documentation and application
for a wetland variant on the Core of Engineer's desk
in Dallas when the new laws took perfect when Biden
came in, and that changed the definition of what is
waters in the US, which meant that we were we
(14:09):
needed a different type of permit, it was going to
take much longer. So I feel pretty certain that that's
one of the things that will It will make it
easier for us to move forward with some of these developments,
for better for worse. It's just that that is what
we actually experienced.
Speaker 1 (14:25):
And going back to something you said earlier about cost, quality,
and risk. You know, are there any other factors that
you look at when accessing of, you know, a location.
Speaker 2 (14:35):
Yeah, so those are just the big categories that they
fall into. But I often say that I'm an inch
deep and a mile wide because we have to look
at so many different things. And somebody says, well, you're
not giving yourself enough credit, and I say, okay, well
I'm an inch deep and two miles wide. Because we
have to consider things like obviously logistics, workforce, we have
(14:56):
to consider the site itself. We have to consider util wastewater,
gas electric. A lot of times we're dealing with shared services,
so if there's an existing if there's kind of location,
then can they provide you with nitrogen or demon water.
Then we also have to look at taxes and finance
(15:17):
and so all of the legal implications, the entitlements of
the property, et cetera, et cetera. So it really is
I can go very very deep on location strategy, but
I know just enough to be dangerous about all of
those other things. And once we start to get into
uncharted territories for me, then you know, I've call in reinforcements,
(15:37):
the experts that can really get deep on those particular things.
Speaker 1 (15:41):
Okay, most mornings when I when I competed to work,
I usually listen to Bloomberg Radio, of course, and I
hear a lot of commercials for the economic development zones,
whether it's Indiana or Ohio. What can what can like
counties or states do to make their region more attractive
for folks like you to come in and say this
(16:02):
is a place where you need to build.
Speaker 2 (16:05):
Yeah, I you know, I think there's there's several things
that they really need to do in order to be
what I call investment ready. And it takes a lot
of effort, and it takes resources and commitment to become
investment ready. The first thing that you really need to
do is you need to figure out what you're good at.
I mean, you know, going back to Amazon HQ two,
(16:27):
when every community whether they had a shot to be
in the final running or not was going all out
to provide Amazon with a proposal. I think there were
some benefits from that because it actually got the stakeholders
around the table to motivate them towards something. But there
was just the reality that most of these communities were
(16:49):
not going to be able to commit to compete. So,
you know, first thing is knowing where you can compete
and then developing assets that will help you compete in
that space. And that starts with a site or a building,
because you could have the best community located in the
best location, with the best workforce, the best cost structure,
(17:09):
and if you don't have a site or a building
that a project can land on in their time frame,
you're never going to you're never going to be considered.
Speaker 1 (17:19):
We just don't.
Speaker 2 (17:20):
We don't have the luxury of waiting for you to
develop that real estate. The second thing that they can
do is really look at their workforce and is their
workforce properly trained and up and ready for that that
type of industry And a lot of times your your
competitiveness will be a reflection what your workforce is. But
(17:41):
what can you do to even make that that value
proposition stronger and it really starts in the K twelve.
We like to see uh STEM education, manufacturing labs, robotics,
et cetera. At least at the at the middle school level,
and going all the way up through high school and
(18:01):
then technical college and even you don't have to have
a university with science or engineering close by, but it
certainly does help. And then the last thing is really well,
I guess there's two more things. One thing is to
have a package to know what you can do when
it comes to incentives. If you have a site that
(18:23):
you've developed for the right project, what type of incentive
will you provide. Would you be willing to give that
site to a project that's going to create a certain
number of jobs and payroll and investment or do you
need to pull back on some of that And what
are your criteria there? Same thing with tax breaks, cash grands,
training programs, et cetera. And then the last thing I
(18:45):
think is a little bit more esoteric, and it's really
about creating a sense of place because one of the
things that has really I've been doing this for twenty
seven or twenty eight years now, and one of the
things that has really changed is that the migration of talent,
(19:07):
and it's more challenging now for me to look at
a workforce and to be able to look at my
client and say definitively that yes, I believe that this
is a great place for you because the workforce is excellent.
It's everywhere's resource constrained. Our talent base has eroded significantly
(19:27):
with the retirement of the baby boomers, and almost everywhere
is playing catchup. So I'm looking at who's doing the
right thing to get into a position to be able
to build those jobs. And that starts with really having
a great community that people want to live in because
people have choices. It used to be that you know,
we would go to would our clients would go to
a location, and the assumption was is that that the
(19:50):
talent would come to them. And it's been a real
paradigm shift that people are deciding where they want to
live and they assume that they're going to be able
to find a job there.
Speaker 1 (19:58):
Right, So we've had.
Speaker 2 (19:59):
To revert are thinking somewhat to be thinking about where
does everybody else want to go? And that's going to
have some impact on where we ultimately decide to locate, and.
Speaker 1 (20:09):
Are there regions of the country or states or counties
that are doing it right that are kind of like,
you know, are kind of a place where other areas
should look to for best practices.
Speaker 2 (20:23):
Well, I think that there are some sort of macro
trends that are happening. I mean, certainly the Sun Belt,
thank God for air conditioning. I would say that, you know,
South Carolina, if you just look at the numbers and
how well they have been able to succeed on a
per capita basis, They've attracted more jobs and more capital
(20:45):
investment over the last ten years in manufacturing than just
about any other location. And that came from having really
really strong leadership. I mean, Nikki Haley was a fantastic
economic development covernor, and she put in place a machine
and they invested in sites. They really became aggressive with incentives,
(21:06):
and you know, we've almost become a victim of our
own success. There's not a lot of great sites left anymore.
And there's a little bit of a you know, resistance
on the part of the population in terms of like,
well maybe too much growth is just too much. I
would say that Alabama is doing a really great job.
They have a program called the Seeds Program that is
investing in sites. And then they also have a qualified
(21:28):
Business Investment Tax which allows companies like CSX to they
can either pay their tax bill in Alabama or they
can create an investment tax credit which they can invest
into infrastructure in order to attract economic development projects and Novellas.
Going back to Novellas again again, that was one of
(21:50):
the projects that was able to have benefit of that
in that because CSX had spent around ten million dollars
developing a rail spur to that megasite in Baldwin County,
and that ultimately was able to show that from a
from a schedule perspective that that CSX and that site
we're going to be able to meet Novellasi's timeline. So
(22:13):
that's a really great example of something creative that I
think that they are doing.
Speaker 1 (22:19):
And you know, so, what is I guess the biggest
roadblock to getting a transaction done or getting a marriage
done in your world? I love that you.
Speaker 2 (22:30):
Call it a marriage because I often call it that.
It's like you know, you're you know when you're dating,
and then you get to know one another and then
finally you get engaged. That when we start doing due diligence,
and obviously you tie the knot when you do the
do the when you make the announcement, and then when
you develop the project, that's your baby. And just like
(22:51):
in life, when you have a baby with someone, you're
tied to them for life. So I do think that
that's a really good analogy. You know, it's a million
in one things. I mean, there are some things that
are completely beyond the control of the company in the community,
things like the price of the commodity, foreign exchange, a variation,
(23:16):
you know, just what the market does. I mean, EVS
is a really good example of like there was a
came out really hot and heavy. It seemed like everything
I was doing with batteries for a while, and they're
still there. I mean, it's not going away. It's just
that a little dose of reality has set in and
it's not happening quite as quickly as we thought. So
those are things that beyond their control. I would say
(23:37):
that in the early days, the inability to keep things
confidential can really destroy a community's chance of landing a project,
because nobody likes to hear that you were looking in
a community from someone other than in your inner circle,
right there's just all kinds of issues associated with that.
(23:58):
I would say that in much of the United States,
particularly exurban and rural areas, water and wastewater infrastructure just
seems to be a big stumbling block. And I feel like,
you know, almost like we had the Electric Rural Electrification
(24:19):
Act that created TVA in the middle of the last century.
I holmost feel like there needs to be a concerted
effort regionally naturally to tie togains together some of our
water wastewater systems. We're being incredibly inefficient, both with resources
and with money, but we're also not There's plenty of
(24:42):
great sites out there that have land, they might have
rail highway infrastructure, high boultage, transmission lines, natural gas lines,
and even ability to recruit, you know, workforce, and there's
just not a robust water or wastewater infrastructure sure that
would support a manufacturing project. So that for me is
(25:06):
one of the things that I see, not specific to
any one project, but just across the board.
Speaker 1 (25:11):
And you know, you mentioned CSX and the Novella's kind
of transaction are there. Do do you work with other railroads?
Do you just work with CSX?
Speaker 2 (25:22):
So I'd say, well, we are representing a corporation, we
are unless they have drivers that would cause us to
look at one provider more than others. We are agnostic
when it comes to who provides the rail service. We
will evaluate it based on the level of service, where
are the connections, how does it optimize on freight freight costs,
(25:43):
things like that. But we often work with up BNSF,
Canadian National or Southern CSX and a lot of the
short lines, like omni tracks for example. The short lines
are really coming in and picking up, uh, some of
the lines that are not as profitable for a main
(26:05):
tier class one rail rail to operate and turning those
into very valuable assets for medium to even large manufacturers
that perhaps don't command you know, they don't have unit
trains or or that sort of thing. They don't have
the level of service required, uh that would be provided
by class wood And.
Speaker 1 (26:27):
Could you could you give other examples of some like
industrial development deals that you've done that you work closely
with the with the railroad, you know, kind of talk
about you know why it was a win for everybody.
Speaker 2 (26:40):
Sure, So we did a glass installation plant for Kenoff,
which is a German building products company, and uh, they
we found them a site in just outside of Waco, Texas,
in a place called McGregor and that is served by
Union Pacific. And what was great about that is that
(27:02):
it was an area that had been earmarked for industrial
and there was some due diligence that had in some
engineering studies that had happened before we arrived, but this
was a project that was large enough to really justify
bringing all of that infrastructure in and that so there
(27:23):
was a rail siding that was put in, improvements to
the local road access, some whole host of improvements that
were made to the infrastructure there, and that really opened
up hundreds of not thousands of acres of land to
additional industrial development. So it was investment that up and
(27:49):
Waco McGregor in the state of Texas made not just
into that lun facility that Kanof was developing, but also
into opening up additional land for other facilities. And there's
been other projects there. I don't recall exactly what they are,
but there have been other other things that have sided there.
Speaker 1 (28:07):
Right, And so you know, we mentioned, you know the
kind of the regulatory I guess headwinds that you face,
and you think that they could ease are there anything else,
you know, whether it's you know, Trump's more protectionists kind
of view of the world and trying to attract more
(28:28):
manufacturing here in the US. You know, even since the
pandemic where a lot of companies are trying to de
risk away from China, has that been a good growth
area for you?
Speaker 2 (28:40):
Like?
Speaker 1 (28:40):
Is that is that fueling growth for a GLS.
Speaker 2 (28:44):
I think that, you know, we hear a lot about restoring,
and it's not that I have never done a restoring project,
but it's more about my clients are thinking about where
do I put my next dollar, and if they already
have facilities in China or even in another life location
that is geographically remote, they're thinking about how do I
(29:06):
de risk my supply chain. And one of the ways
to do that is to just get closer to your
customers and closer to your raw materials.
Speaker 1 (29:14):
So I have.
Speaker 2 (29:14):
Definitely seen an alignment of supply chains along more more
north south rather than east west. So you know, the
America's Europe with North Africa and then and then Asia,
and I think that that will continue. I think that
(29:35):
the geopolitical issues that are not necessarily unique to Trump,
but are particularly salient in in Trump's uh, in Trump's
world are driving that investment. I will say right now
that we we typically see a slow down in election years,
(29:58):
not so much of companies thinking about where they're going
to go, but actually making decisions. And we certainly saw
that in UH twenty twenty four.
Speaker 1 (30:07):
I guess because the uncertainty.
Speaker 2 (30:09):
They don't the uncertainty. Yeah, and a lot of times,
you know, by by September, so they'll start thinking, well,
I've got to I've got to get ready to make
a decision, even if I don't know what the ultimate
answer is going to be, And so the activity level
will pick back up again. But what I found is
that it's kind of continued passing it over because even
(30:30):
though we know who the president was going to be
and now is, it's still pretty uncertain in to what
the policies where we're going to settle on a policy standpoint,
I mean twenty five percent Do I make a decision
based on twenty five percent tiar of Sun Mexico or
do not? Or do I you know? And now do
I also need to be thinking about Columbia? I Mean,
(30:52):
it's just so much right noise, and companies really just
don't like uncertainty. You know, some of these some of
these policies could be inflationary, which might hurt the business case.
Even if it's you know not B two C. It's
still trickling down into these investments are being made. It
(31:12):
could be not as profitable in an inflationary environment. So
it's just it's it's really dicey times right now. I
will say that, you know, there's absolutely no doubt in
my mind that there is more interest in the United
States now than there would be ordinarily. We were already
(31:36):
very I don't think we need it, to be honest.
I mean, I think the United States in North America
in general is blessed with you know, great energy. You
know at demography that says that we will not only
have a market for decades to come, but they will
also have workers for decades to come, a market that
(31:59):
is strong and growing and continues to prosper even in
inflationary times. And so it's hard to argue and relative stability,
you know, where we have emoked around us for the
most part, which provides a lot of just intrinsic defensiveness.
(32:20):
So it's really hard to argue with the US. And
I think more than anything the cost of energy relative
to the rest of the world and how that has
fallen since shale gas started to come online. Is you know,
done more for the US economy and its competitiveness around
the world than any IRA or Chips Act or a
(32:45):
thread of tariffs. That more than anything. I say, I
spent the first ten years of my career and moving
companies out of the US and spent the second half
of my career moving them back in. And a lot
of that has to do with energy. We do projects
or like for example, Identa on a joint venture project
between CF Industries and Mitsui to do a blue hydrogen
(33:14):
into ammonia facility in Ascension Parish, Louisiana, and that is
basically tanking our cheap natural gas, which is plentiful here.
It's blue hydrogen because we were doing carbon capture, converting
that into ammonia that will then be shipped to Japan
(33:34):
for dispatchful power. So think about all the costs that
are associated with converting, not delivering that natural gas to
the facility, converting it into hydrogen, then it to ammonia,
putting it onto a ship, shipping it to Japan, and
then re constituting that to hydrogen to burn as energy.
I mean, think about the cost penalty that applies, like
(33:56):
Jaapean is having to go through in order to have
a reliable, dispatchable source of energy. But they're willing to
do it because the alternative is quite grim. We are
at the luxury that we don't have to think about that.
We are the provider of that energy, right, so puts
us in a very enviable position.
Speaker 1 (34:16):
So let me ask you a question. So you mentioned
the first half year career was moving companies out of
the United States, second half of your career was moving
them back in. Well, let's break it out into thirds.
So if assumed me, those were the first two.
Speaker 2 (34:29):
So you're telling me I've got a third lest Yeah,
you got after.
Speaker 1 (34:32):
Working another ten to fourteen years. All right, hopefully you know,
for another twenty years. But let's just say, looking forward,
what would the what do you think the next third
will look like? And I know it's hard to predict
the future.
Speaker 2 (34:50):
Well, first of all, my husband would kill me if
I work for another ten to fourteen years. But I
can say I think, you know, the next ten years
or so. I really believe that we are in our lifetimes.
We haven't seen change like this, and we have been
operating under the assumption that there are there's an international order,
(35:15):
that it's low barriers to trade, low risk of conflict,
and so you know, the world is flat, right, you know,
Manufacturing just chases the lowest cost wherever that might be.
(35:36):
And I would argue that we underpriced the risk premium
for having these global extended supply chains. We underprised that
for a long time, and then COVID hit us right
between the eyes. And COVID was not so much the
cause of this change, but it was a catalyst. And
(35:58):
you know, socially economically, there were a lot of implications
of what we did. I mean, you know, millions, if
not billions of people were raised out of poverty, but
relative to the rest of the world, the United States
did not do as well. And I think that's put
us into a political environment where we are. So the
pendulum is swinging back the other way.
Speaker 1 (36:16):
So we went.
Speaker 2 (36:17):
From you know, the world is flat to it's suddenly
becoming very very round again. And I think that there
will be unfortunately, there will be winners and losers in this,
and we're probably going to give up some of those gains.
I just don't see the I don't see the end
in sight right now for at least ten, maybe more years.
(36:41):
For the United States. I think we are in a
period of rapid reindustrialization, and it's just a matter of
can we get the infrastructure in place, can we get
the power, can we develop the sites. Do we have
the workforce in order to be able to deliver those projects.
I don't think the momentum is definitely there. It's just
a matter of how quickly we can deliver on that momentum.
Speaker 1 (37:03):
Gotcha all right, Well, here's to in a few more years.
How about that?
Speaker 2 (37:09):
Yeah, that sounds good. It's a good time to be
a side selection consultant. I can say that. Lots of changes.
Speaker 1 (37:16):
How did you get into the industry.
Speaker 2 (37:19):
Well, I was doing an internship in Argentina for a
company called Floor Corporation. They're Floor Daniel back then, and
that's where I started my career. And I met a
guy Ed McCollum. He's sadly passed on, but he was
allayon in this industry and he was working on a
feasibility study for a copper smelter in Argentina, and so
(37:41):
I was asking him about what he was doing, and
it was just absolutely fascinating. It put together all these
things that I love, which is travel, solving problems, manufacturing, construction.
And so I asked him, and I was like, let
me get this straight. You fly all over the world
working with you know, executive c suite determine where is
the optimal place for them and to build these big
(38:03):
manufacturing facilities. And he said, yeah, that's right, and it
and they pay you to do that. I said, I
would do that for free. Please hire me right now,
and he took me up on it, and so I
moved to Greenville, South Carolina, which is where their sighting
group was headquartered, and that's where we remain until this day.
And interestingly enough, that's where my parents are faces gron
but I never lived here, so it's it's definitely become home.
(38:26):
And now it's you know, it's really my passion to
help companies and communities make a perfect match and grow
and prosper together.
Speaker 1 (38:38):
All right, great, And you know, I asked this with
a lot of my guests because I'm always just curious, like,
do you have a favorite book about leadership or business
that's close to your heart that you might have read
a long time ago or yesterday that that you know,
you kind of always pull to.
Speaker 2 (38:53):
Well, we run on EOS Entrepreneurial Operating System, so of
course I love you know, traction and rocket fuel. But
I just read Brenane Brown daring greatly and I really
really loved that book. I think that you know, culture
with the importance of culture and my business was not
something that I necessarily could model, but it is definitely
(39:17):
something that I've learned is so important in how to
separate your your company from being mediocre to being to
being great.
Speaker 1 (39:26):
So, you know, it sounds like from you know, your
when you're first getting into the industry. One of the
attractive things to it was the travel work. Travel can
be a lot of fun, can be dragged too at times,
you know, depending where you're staying. Do you have a
favorite place that you go for fun around the world.
Speaker 2 (39:46):
Well, definitely Buenos Aires. I mean it's, you know, one
of my favorite places in the world. I love New
York and I really love a couple of great trip
that I took a couple of years ago as to Georgia,
the country state, and it's somewhat I'm discovered by Americans
(40:06):
and it's really phenomenal, the people, the food, the culture,
the majestic beauty of the mountains, and wine making is
you know, it's some of the old wine, oldest wine
making in the world. So I've got to say that
george is one of my favorite places ever.
Speaker 1 (40:25):
I'll have to I'll have to check that out because
I know that with globalization, you can go anywhere and
you sometimes you feel like you're not too far from
New York. Sometimes that's right, yeah, exactly.
Speaker 2 (40:37):
Unfortunately, I'm I'm a little bit concerned that, you know,
the world is becoming a riskier place, and so if
there's some place you want to go that's uh, you know,
like Georgia for example, don't don't put it off too long.
Speaker 1 (40:49):
Good to know. Well, well, DDI, I really want to
thank you for your time and insights. This is a
great conversation, great Thank you so much.
Speaker 2 (40:56):
It was a pleasure being here and.
Speaker 1 (40:59):
I want to thank you for too tuning in. If
you liked the episode, please subscribe and leave a review.
We've lined up a number of great guests for the podcast,
so check back to hear conversations with c SPIT executives, shippers, regulators,
and decision makers within the freight markets. Also, if you
have an idea for a future episode, please hit me
up on the Bloomberg terminal. We're on Twitter at logistics Lee.
(41:19):
And quickly before I go, I just want to give
a shout out to White, what might be the youngest
fan of the Talking Transports podcast. The other week, I
was at my thirteen year old son's basketball game and
one of his buddies came up to me and told
me that he loved the podcast. So thanks for that,
and I hope you keep listening, Nate, So thank thank you.
(41:39):
So with that, I have a great day, great week,
and a great year. Take care everyone,
Hi everyone, This is Lee Clasgow when We're Talking Transports.
Welcome to the Bloomberg Intelligence Talking Transport Podcast. I'm your host,
Lee Klasgow, Senior Freight transportation logistics Analysts at Bloomberg Intelligence,
Bloomberg's in house research arm of almost five hundred analysts
and strategists around the globe. Before diving in a little
public service announcement, your support is instrumental to keep bringing
(00:28):
great guests onto the podcast like the one we have today.
If you haven't already, please do take a moment to
follow rate and share the Talking Transports podcast with your friends, family,
and colleagues. We really do appreciate your support. I'm really
excited to have with us today. D D. Calwell, President
and CEO of Global Location Strategies, a leading site selection
(00:51):
and incentive negotiation firm for manufacturing and industrial companies. D
D is one of the world's most authoritative site and
instead of negotiations expert with more than two decades of
experience in the industry, and she's been dubbed America's factory
Whisperer by Bloomberg News. As President and CEO of Global
(01:12):
Location Strategies, Dede's focus is her company's mission to match
companies and communities for mutual, sustainable prosperity. Under her leadership,
GLS has become a world leader in site selection and
incentive negotiation services and has been named to INK five
hundred Fastest Growing Companies list twice. She's a proud member
(01:35):
of the Site Selection Guild, the only association of the
world's foremost professional site selection consultants. Deete was the first
female chairperson of the organization has held various leadership roles,
currently serving as chair of the Ready Sites Initiative. She
holds a bachelor's degree in architecture from Clemson University and
(01:56):
an International NBA from the University of South Carolina's Darla
Moore School of Business. Welcome to the podcast, Didie. Thanks
so much for being here.
Speaker 2 (02:06):
Thanks so much for having me. Great to be here.
Speaker 1 (02:08):
And so the first question, are you more of a
Tigers fan or or a game Cocks fan?
Speaker 2 (02:13):
My blood run at the Orange, for sure. So I'm
a Tiger fan. I pull for the game Cocks when
they're not playing Clemson, but otherwise I'm diehard Clemson.
Speaker 1 (02:23):
All right, all right, good Tigers. So you know, in
the introduction, I kind of briefly said what GLS is
all about. Can you give us a little background about
the organization that you lead for us?
Speaker 2 (02:36):
Sure, So we're based in Greenville, South Carolina, but we
have a presence in three continents Europe and in South
America as well, and for about seventeen years we have
been offering location strategy services, primarily to mafactoring clients that
are looking to where they place plant, property and equipment
(03:00):
and people around around the globe and how they do
that by optimizing their return on investment for their shareholders.
We also do some consulting work for states, communities, railroads,
electricity companies that are trying to be more effective in
recruiting jobs, capital investment, and load to their locations. We've
(03:22):
got about twenty folks on staff. We've grown very very
rapidly since COVID. It's been a lot of frothiness in
the in the market, and through that and also through
the development of some technology that we've done, we've really
been able to capitalize on that and grow in a
pretty pretty nice clip. So very very difficult to keep up,
(03:46):
but it's been a wild ride, I.
Speaker 1 (03:49):
Bet, and one of the reasons you know why, I
wanted to have you on. You know, I heard you
speak at csx's investor day last year. And also, you know,
the railroads in order for them to row, they're really
focused on an industrial development, and that's really where you
come in and where your firm comes in. So I
thought it was a great kind of learning experience for
(04:10):
people that are looking at railroads and trying to figure
out how they're growing, because you're really bringing together, if
I understand your business correctly, you know the railroads with
the companies that are looking to grow into new sites
or I guess regions that are looking for economic development.
Speaker 2 (04:29):
Yes, that is that is correct. So a lot of
black clients require rail service, either direct rail or trans
modal or intermodal or transload.
Speaker 1 (04:41):
And so.
Speaker 2 (04:44):
There's not there's a limited number of properties that have
that capability, and so our clients are really looking for
the optimal location that they can put their assets, and
it's based on really three things, cost, quality, and risk.
So if they are going to build a manufacturing facility,
and a lot of my clients the projects are anywhere
from one hundred million to many billion dollars in investment
(05:09):
in order for them to be able to do that,
they need to understand that they're going to a location
that is ideally the lowest cost both on investment and
operating costs. So from a logistics standpoint, you're looking at,
you know, where is it easiest to bring the rail
and where can I minimize on my freight cost the
highest quality, So maybe related to rail transport, it's how
(05:31):
good is the service, how good are my connections? Am
I own a direct mainline to my main customer or
my main supplier. Those are all quality factors, and then
risk moving forward. So those might be natural disaster risks,
they might be risk to my schedule, to my budget,
to my ability to operate now into the future. And
so if we can help them find the location that
(05:53):
optimizes on all three of those, then it's a relatively
easy choice. But like in life, a lot of things
are not so cut and dry, and so my job
is to really help them understand what those trade offs
and make the decision that is best for their operation
moving forward. You know, these are generational investments. So if
(06:14):
you're thinking about putting hundreds of millions of dollars into
bricks and mortar and machinery and equipment, training, hundreds of people.
In order to get a return on investment, you have
to run that facility out of profit for a really
long time. And so these are high stakes decisions with
lots and lots of variables to take into account, and
(06:36):
at almost every step there's a potential pitfall. So we
help them navigate that as best we can.
Speaker 1 (06:43):
And most of your customers, I guess the market you
serve are mostly manufacturing and industrial. Is that fair to say?
Speaker 2 (06:51):
That is correct? So we do some warehouse and distribution,
but mainly for our manufacturing clients. We also do data centers,
which is not manufacturing, but it is very capital and
energy intensive. And then we're also quite active now on
energy generation. So back in the late nineties early two thousands,
(07:12):
I did a lot of projects that were merchant combined
cycle gas plants, and with Enron and that fiasco, that
sort of fell out of favor. But with the availability
of cheap natural gas and also the spiking demand for electricity,
those projects have come back in vogue. So I'm working
on probably half a dozen of those across the US
(07:34):
right now.
Speaker 1 (07:35):
Okay, And so like just curious, so how long does
it take to get a deal done in your business?
Speaker 2 (07:41):
It really varies a lot of it. Typically we can
move faster than our clients. It's quite common that companies
will call me up and say I need a site
you know, tomorrow or even better yesterday, and so we
can move really quickly. I guess one really good example
was Noveallas and their elumited rolling mill. They had narrowed
(08:05):
down to a site a few years ago, I think
this was in twenty twenty one, and there were some
issues associated with the site, so they asked us to
develop a Plan B and to look at alternative sites,
and they caught us in February and announce the project
on the Plan B site in Baldwin County, Alabama in
May of that year. So that is a lightning lightning
(08:28):
fast three months or something like that. More typically, it
would take us, let's say four to six months to
identify the primary and alternate sites, and we usually like
to have two that we're considering, just to avoid exactly
what Novellas encountered. It takes us four to six months
(08:49):
to identify the primary and alternate site and the location,
and then anywhere from six to twelve weeks or as
long as the client wants to take to do the negotiatations,
the due diligence and announce the project.
Speaker 1 (09:03):
And most of the deals that you work on are
they for sites that already have facilities and infrastructure in place,
or these kind of like greenfield brown field kind of
transactions that you mostly work on.
Speaker 2 (09:16):
Yeah, So I would say small percentage of the projects
that we do or existing buildings. I think we're a
little bit different than the market from that standpoint because
many companies are small enough and their manufacturing processes are
generic enough that they can go into existing buildings. Most
(09:37):
of the projects that I work on, the buildings are
really built for that particular purpose. So if you're talking
about paper machines or you know, furnaces for glass insulation,
I mean, these are not buildings that you're going to find. Ideally,
they would be sites that are they might still be
considered greenfield, but they are in an industrial park or
(09:59):
in an area where there has been a lot of
due diligence and the utilities and the infrastructure have been
brought to the site. In some cases, we're able to
go into ground fields, not so much into existing buildings,
but perhaps there was an old you know, textile plan
or even a close coal fired power plant adjacent and
(10:20):
it already has a lot of the utility infrastructure there.
That's a win win for everyone because you're not taking
a green field property out of service, and you also
have oftentimes faster development schedule and lower costs and less
environmental risk if you're going into something that's already already
(10:42):
approved and built as and as in.
Speaker 1 (10:44):
Place, right and if you're starting from scratch where maybe
they you know, as you mentioned, like, the infrastructure is
already there. How long does it take from the time
that you suggest the site to a customer until the
customer is whatever they're doing, either they're manufacturing widgets or
what have you.
Speaker 2 (11:05):
Typically, for a large manufacturing project, particularly bits process related,
you're probably going to need a year or so for
engineering and design and permitting. Many of these are require
major air permits, and so that often takes somewhere between
six months and a year or even longer. So, and
(11:27):
then you've got to do construction, which you cannot start
construction often times until you have your airpin permit, and
that often takes twelve months. So it's really anywhere from
twenty four to thirty six months from the time that
they they break around or the time that they announce
the project and start you know, detailed engineering and permitting
for that site and when they start the facility.
Speaker 1 (11:49):
Yup, So you mentioned permitting. There's a new administration in town.
They are really yeah, I heard from why. I understand
they're a little more pro business than previous administrations. And
you know he happens to be a develop developer as well.
(12:10):
So what what what is that going to do for
your industry? Are you guys like expecting that the time
to you know, build something is going to be cut
significantly because of the new administration or it's not going
to be that dramatic of a change.
Speaker 2 (12:27):
It's a little bit hard to say. On the air
permitting because there are there is a there are legal
statutes that have certain time requirements, and the air permitting
is almost entirely delegated to the states from the e
P A.
Speaker 1 (12:40):
Can I ask a dumb question? Air permitting means is
what like air quality?
Speaker 2 (12:45):
Air quality? So if you have emissions associated with your
with your operation, there criteria pollutants like socks, sulfur, dinoxide,
nitros dioxide, zone, et cetera. And so there's limits on
what you can do, and if you depending on what
your emissions are, you have to get a permit, and
(13:05):
your classification of your permit is determined by how much
of those permit those pollutants you have and whether or
not you're in an area that is air quality attainment
basically is in an area that meets the standards by
the Clean Air Act, So that determines what kind of
permit and how long it's going to take, and whether
or not you have to buy credits. So I don't
really think that that is we're going to see any
(13:27):
major changes there immediately. Where I'm don't have to assume
that we're going to see changes because we experienced this
the last time that Trump was in h was in
the presidency was with the Core of Engineers and what
is considered the waters of the US. So we were
working on a project in Arkansas and we're going through
(13:49):
due diligence and we literally had our documentation and application
for a wetland variant on the Core of Engineer's desk
in Dallas when the new laws took perfect when Biden
came in, and that changed the definition of what is
waters in the US, which meant that we were we
(14:09):
needed a different type of permit, it was going to
take much longer. So I feel pretty certain that that's
one of the things that will It will make it
easier for us to move forward with some of these developments,
for better for worse. It's just that that is what
we actually experienced.
Speaker 1 (14:25):
And going back to something you said earlier about cost, quality,
and risk. You know, are there any other factors that
you look at when accessing of, you know, a location.
Speaker 2 (14:35):
Yeah, so those are just the big categories that they
fall into. But I often say that I'm an inch
deep and a mile wide because we have to look
at so many different things. And somebody says, well, you're
not giving yourself enough credit, and I say, okay, well
I'm an inch deep and two miles wide. Because we
have to consider things like obviously logistics, workforce, we have
(14:56):
to consider the site itself. We have to consider util wastewater,
gas electric. A lot of times we're dealing with shared services,
so if there's an existing if there's kind of location,
then can they provide you with nitrogen or demon water.
Then we also have to look at taxes and finance
(15:17):
and so all of the legal implications, the entitlements of
the property, et cetera, et cetera. So it really is
I can go very very deep on location strategy, but
I know just enough to be dangerous about all of
those other things. And once we start to get into
uncharted territories for me, then you know, I've call in reinforcements,
(15:37):
the experts that can really get deep on those particular things.
Speaker 1 (15:41):
Okay, most mornings when I when I competed to work,
I usually listen to Bloomberg Radio, of course, and I
hear a lot of commercials for the economic development zones,
whether it's Indiana or Ohio. What can what can like
counties or states do to make their region more attractive
for folks like you to come in and say this
(16:02):
is a place where you need to build.
Speaker 2 (16:05):
Yeah, I you know, I think there's there's several things
that they really need to do in order to be
what I call investment ready. And it takes a lot
of effort, and it takes resources and commitment to become
investment ready. The first thing that you really need to
do is you need to figure out what you're good at.
I mean, you know, going back to Amazon HQ two,
(16:27):
when every community whether they had a shot to be
in the final running or not was going all out
to provide Amazon with a proposal. I think there were
some benefits from that because it actually got the stakeholders
around the table to motivate them towards something. But there
was just the reality that most of these communities were
(16:49):
not going to be able to commit to compete. So,
you know, first thing is knowing where you can compete
and then developing assets that will help you compete in
that space. And that starts with a site or a building,
because you could have the best community located in the
best location, with the best workforce, the best cost structure,
(17:09):
and if you don't have a site or a building
that a project can land on in their time frame,
you're never going to you're never going to be considered.
Speaker 1 (17:19):
We just don't.
Speaker 2 (17:20):
We don't have the luxury of waiting for you to
develop that real estate. The second thing that they can
do is really look at their workforce and is their
workforce properly trained and up and ready for that that
type of industry And a lot of times your your
competitiveness will be a reflection what your workforce is. But
(17:41):
what can you do to even make that that value
proposition stronger and it really starts in the K twelve.
We like to see uh STEM education, manufacturing labs, robotics,
et cetera. At least at the at the middle school level,
and going all the way up through high school and
(18:01):
then technical college and even you don't have to have
a university with science or engineering close by, but it
certainly does help. And then the last thing is really well,
I guess there's two more things. One thing is to
have a package to know what you can do when
it comes to incentives. If you have a site that
(18:23):
you've developed for the right project, what type of incentive
will you provide. Would you be willing to give that
site to a project that's going to create a certain
number of jobs and payroll and investment or do you
need to pull back on some of that And what
are your criteria there? Same thing with tax breaks, cash grands,
training programs, et cetera. And then the last thing I
(18:45):
think is a little bit more esoteric, and it's really
about creating a sense of place because one of the
things that has really I've been doing this for twenty
seven or twenty eight years now, and one of the
things that has really changed is that the migration of talent,
(19:07):
and it's more challenging now for me to look at
a workforce and to be able to look at my
client and say definitively that yes, I believe that this
is a great place for you because the workforce is excellent.
It's everywhere's resource constrained. Our talent base has eroded significantly
(19:27):
with the retirement of the baby boomers, and almost everywhere
is playing catchup. So I'm looking at who's doing the
right thing to get into a position to be able
to build those jobs. And that starts with really having
a great community that people want to live in because
people have choices. It used to be that you know,
we would go to would our clients would go to
a location, and the assumption was is that that the
(19:50):
talent would come to them. And it's been a real
paradigm shift that people are deciding where they want to
live and they assume that they're going to be able
to find a job there.
Speaker 1 (19:58):
Right, So we've had.
Speaker 2 (19:59):
To revert are thinking somewhat to be thinking about where
does everybody else want to go? And that's going to
have some impact on where we ultimately decide to locate, and.
Speaker 1 (20:09):
Are there regions of the country or states or counties
that are doing it right that are kind of like,
you know, are kind of a place where other areas
should look to for best practices.
Speaker 2 (20:23):
Well, I think that there are some sort of macro
trends that are happening. I mean, certainly the Sun Belt,
thank God for air conditioning. I would say that, you know,
South Carolina, if you just look at the numbers and
how well they have been able to succeed on a
per capita basis, They've attracted more jobs and more capital
(20:45):
investment over the last ten years in manufacturing than just
about any other location. And that came from having really
really strong leadership. I mean, Nikki Haley was a fantastic
economic development covernor, and she put in place a machine
and they invested in sites. They really became aggressive with incentives,
(21:06):
and you know, we've almost become a victim of our
own success. There's not a lot of great sites left anymore.
And there's a little bit of a you know, resistance
on the part of the population in terms of like,
well maybe too much growth is just too much. I
would say that Alabama is doing a really great job.
They have a program called the Seeds Program that is
investing in sites. And then they also have a qualified
(21:28):
Business Investment Tax which allows companies like CSX to they
can either pay their tax bill in Alabama or they
can create an investment tax credit which they can invest
into infrastructure in order to attract economic development projects and Novellas.
Going back to Novellas again again, that was one of
(21:50):
the projects that was able to have benefit of that
in that because CSX had spent around ten million dollars
developing a rail spur to that megasite in Baldwin County,
and that ultimately was able to show that from a
from a schedule perspective that that CSX and that site
we're going to be able to meet Novellasi's timeline. So
(22:13):
that's a really great example of something creative that I
think that they are doing.
Speaker 1 (22:19):
And you know, so, what is I guess the biggest
roadblock to getting a transaction done or getting a marriage
done in your world? I love that you.
Speaker 2 (22:30):
Call it a marriage because I often call it that.
It's like you know, you're you know when you're dating,
and then you get to know one another and then
finally you get engaged. That when we start doing due diligence,
and obviously you tie the knot when you do the
do the when you make the announcement, and then when
you develop the project, that's your baby. And just like
(22:51):
in life, when you have a baby with someone, you're
tied to them for life. So I do think that
that's a really good analogy. You know, it's a million
in one things. I mean, there are some things that
are completely beyond the control of the company in the community,
things like the price of the commodity, foreign exchange, a variation,
(23:16):
you know, just what the market does. I mean, EVS
is a really good example of like there was a
came out really hot and heavy. It seemed like everything
I was doing with batteries for a while, and they're
still there. I mean, it's not going away. It's just
that a little dose of reality has set in and
it's not happening quite as quickly as we thought. So
those are things that beyond their control. I would say
(23:37):
that in the early days, the inability to keep things
confidential can really destroy a community's chance of landing a project,
because nobody likes to hear that you were looking in
a community from someone other than in your inner circle,
right there's just all kinds of issues associated with that.
(23:58):
I would say that in much of the United States,
particularly exurban and rural areas, water and wastewater infrastructure just
seems to be a big stumbling block. And I feel like,
you know, almost like we had the Electric Rural Electrification
(24:19):
Act that created TVA in the middle of the last century.
I holmost feel like there needs to be a concerted
effort regionally naturally to tie togains together some of our
water wastewater systems. We're being incredibly inefficient, both with resources
and with money, but we're also not There's plenty of
(24:42):
great sites out there that have land, they might have
rail highway infrastructure, high boultage, transmission lines, natural gas lines,
and even ability to recruit, you know, workforce, and there's
just not a robust water or wastewater infrastructure sure that
would support a manufacturing project. So that for me is
(25:06):
one of the things that I see, not specific to
any one project, but just across the board.
Speaker 1 (25:11):
And you know, you mentioned CSX and the Novella's kind
of transaction are there. Do do you work with other railroads?
Do you just work with CSX?
Speaker 2 (25:22):
So I'd say, well, we are representing a corporation, we
are unless they have drivers that would cause us to
look at one provider more than others. We are agnostic
when it comes to who provides the rail service. We
will evaluate it based on the level of service, where
are the connections, how does it optimize on freight freight costs,
(25:43):
things like that. But we often work with up BNSF,
Canadian National or Southern CSX and a lot of the
short lines, like omni tracks for example. The short lines
are really coming in and picking up, uh, some of
the lines that are not as profitable for a main
(26:05):
tier class one rail rail to operate and turning those
into very valuable assets for medium to even large manufacturers
that perhaps don't command you know, they don't have unit
trains or or that sort of thing. They don't have
the level of service required, uh that would be provided
by class wood And.
Speaker 1 (26:27):
Could you could you give other examples of some like
industrial development deals that you've done that you work closely
with the with the railroad, you know, kind of talk
about you know why it was a win for everybody.
Speaker 2 (26:40):
Sure, So we did a glass installation plant for Kenoff,
which is a German building products company, and uh, they
we found them a site in just outside of Waco, Texas,
in a place called McGregor and that is served by
Union Pacific. And what was great about that is that
(27:02):
it was an area that had been earmarked for industrial
and there was some due diligence that had in some
engineering studies that had happened before we arrived, but this
was a project that was large enough to really justify
bringing all of that infrastructure in and that so there
(27:23):
was a rail siding that was put in, improvements to
the local road access, some whole host of improvements that
were made to the infrastructure there, and that really opened
up hundreds of not thousands of acres of land to
additional industrial development. So it was investment that up and
(27:49):
Waco McGregor in the state of Texas made not just
into that lun facility that Kanof was developing, but also
into opening up additional land for other facilities. And there's
been other projects there. I don't recall exactly what they are,
but there have been other other things that have sided there.
Speaker 1 (28:07):
Right, And so you know, we mentioned, you know the
kind of the regulatory I guess headwinds that you face,
and you think that they could ease are there anything else,
you know, whether it's you know, Trump's more protectionists kind
of view of the world and trying to attract more
(28:28):
manufacturing here in the US. You know, even since the
pandemic where a lot of companies are trying to de
risk away from China, has that been a good growth
area for you?
Speaker 2 (28:40):
Like?
Speaker 1 (28:40):
Is that is that fueling growth for a GLS.
Speaker 2 (28:44):
I think that, you know, we hear a lot about restoring,
and it's not that I have never done a restoring project,
but it's more about my clients are thinking about where
do I put my next dollar, and if they already
have facilities in China or even in another life location
that is geographically remote, they're thinking about how do I
(29:06):
de risk my supply chain. And one of the ways
to do that is to just get closer to your
customers and closer to your raw materials.
Speaker 1 (29:14):
So I have.
Speaker 2 (29:14):
Definitely seen an alignment of supply chains along more more
north south rather than east west. So you know, the
America's Europe with North Africa and then and then Asia,
and I think that that will continue. I think that
(29:35):
the geopolitical issues that are not necessarily unique to Trump,
but are particularly salient in in Trump's uh, in Trump's
world are driving that investment. I will say right now
that we we typically see a slow down in election years,
(29:58):
not so much of companies thinking about where they're going
to go, but actually making decisions. And we certainly saw
that in UH twenty twenty four.
Speaker 1 (30:07):
I guess because the uncertainty.
Speaker 2 (30:09):
They don't the uncertainty. Yeah, and a lot of times,
you know, by by September, so they'll start thinking, well,
I've got to I've got to get ready to make
a decision, even if I don't know what the ultimate
answer is going to be, And so the activity level
will pick back up again. But what I found is
that it's kind of continued passing it over because even
(30:30):
though we know who the president was going to be
and now is, it's still pretty uncertain in to what
the policies where we're going to settle on a policy standpoint,
I mean twenty five percent Do I make a decision
based on twenty five percent tiar of Sun Mexico or
do not? Or do I you know? And now do
I also need to be thinking about Columbia? I Mean,
(30:52):
it's just so much right noise, and companies really just
don't like uncertainty. You know, some of these some of
these policies could be inflationary, which might hurt the business case.
Even if it's you know not B two C. It's
still trickling down into these investments are being made. It
(31:12):
could be not as profitable in an inflationary environment. So
it's just it's it's really dicey times right now. I
will say that, you know, there's absolutely no doubt in
my mind that there is more interest in the United
States now than there would be ordinarily. We were already
(31:36):
very I don't think we need it, to be honest.
I mean, I think the United States in North America
in general is blessed with you know, great energy. You
know at demography that says that we will not only
have a market for decades to come, but they will
also have workers for decades to come, a market that
(31:59):
is strong and growing and continues to prosper even in
inflationary times. And so it's hard to argue and relative stability,
you know, where we have emoked around us for the
most part, which provides a lot of just intrinsic defensiveness.
(32:20):
So it's really hard to argue with the US. And
I think more than anything the cost of energy relative
to the rest of the world and how that has
fallen since shale gas started to come online. Is you know,
done more for the US economy and its competitiveness around
the world than any IRA or Chips Act or a
(32:45):
thread of tariffs. That more than anything. I say, I
spent the first ten years of my career and moving
companies out of the US and spent the second half
of my career moving them back in. And a lot
of that has to do with energy. We do projects
or like for example, Identa on a joint venture project
between CF Industries and Mitsui to do a blue hydrogen
(33:14):
into ammonia facility in Ascension Parish, Louisiana, and that is
basically tanking our cheap natural gas, which is plentiful here.
It's blue hydrogen because we were doing carbon capture, converting
that into ammonia that will then be shipped to Japan
(33:34):
for dispatchful power. So think about all the costs that
are associated with converting, not delivering that natural gas to
the facility, converting it into hydrogen, then it to ammonia,
putting it onto a ship, shipping it to Japan, and
then re constituting that to hydrogen to burn as energy.
I mean, think about the cost penalty that applies, like
(33:56):
Jaapean is having to go through in order to have
a reliable, dispatchable source of energy. But they're willing to
do it because the alternative is quite grim. We are
at the luxury that we don't have to think about that.
We are the provider of that energy, right, so puts
us in a very enviable position.
Speaker 1 (34:16):
So let me ask you a question. So you mentioned
the first half year career was moving companies out of
the United States, second half of your career was moving
them back in. Well, let's break it out into thirds.
So if assumed me, those were the first two.
Speaker 2 (34:29):
So you're telling me I've got a third lest Yeah,
you got after.
Speaker 1 (34:32):
Working another ten to fourteen years. All right, hopefully you know,
for another twenty years. But let's just say, looking forward,
what would the what do you think the next third
will look like? And I know it's hard to predict
the future.
Speaker 2 (34:50):
Well, first of all, my husband would kill me if
I work for another ten to fourteen years. But I
can say I think, you know, the next ten years
or so. I really believe that we are in our lifetimes.
We haven't seen change like this, and we have been
operating under the assumption that there are there's an international order,
(35:15):
that it's low barriers to trade, low risk of conflict,
and so you know, the world is flat, right, you know,
Manufacturing just chases the lowest cost wherever that might be.
(35:36):
And I would argue that we underpriced the risk premium
for having these global extended supply chains. We underprised that
for a long time, and then COVID hit us right
between the eyes. And COVID was not so much the
cause of this change, but it was a catalyst. And
(35:58):
you know, socially economically, there were a lot of implications
of what we did. I mean, you know, millions, if
not billions of people were raised out of poverty, but
relative to the rest of the world, the United States
did not do as well. And I think that's put
us into a political environment where we are. So the
pendulum is swinging back the other way.
Speaker 1 (36:16):
So we went.
Speaker 2 (36:17):
From you know, the world is flat to it's suddenly
becoming very very round again. And I think that there
will be unfortunately, there will be winners and losers in this,
and we're probably going to give up some of those gains.
I just don't see the I don't see the end
in sight right now for at least ten, maybe more years.
(36:41):
For the United States. I think we are in a
period of rapid reindustrialization, and it's just a matter of
can we get the infrastructure in place, can we get
the power, can we develop the sites. Do we have
the workforce in order to be able to deliver those projects.
I don't think the momentum is definitely there. It's just
a matter of how quickly we can deliver on that momentum.
Speaker 1 (37:03):
Gotcha all right, Well, here's to in a few more years.
How about that?
Speaker 2 (37:09):
Yeah, that sounds good. It's a good time to be
a side selection consultant. I can say that. Lots of changes.
Speaker 1 (37:16):
How did you get into the industry.
Speaker 2 (37:19):
Well, I was doing an internship in Argentina for a
company called Floor Corporation. They're Floor Daniel back then, and
that's where I started my career. And I met a
guy Ed McCollum. He's sadly passed on, but he was
allayon in this industry and he was working on a
feasibility study for a copper smelter in Argentina, and so
(37:41):
I was asking him about what he was doing, and
it was just absolutely fascinating. It put together all these
things that I love, which is travel, solving problems, manufacturing, construction.
And so I asked him, and I was like, let
me get this straight. You fly all over the world
working with you know, executive c suite determine where is
the optimal place for them and to build these big
(38:03):
manufacturing facilities. And he said, yeah, that's right, and it
and they pay you to do that. I said, I
would do that for free. Please hire me right now,
and he took me up on it, and so I
moved to Greenville, South Carolina, which is where their sighting
group was headquartered, and that's where we remain until this day.
And interestingly enough, that's where my parents are faces gron
but I never lived here, so it's it's definitely become home.
(38:26):
And now it's you know, it's really my passion to
help companies and communities make a perfect match and grow
and prosper together.
Speaker 1 (38:38):
All right, great, And you know, I asked this with
a lot of my guests because I'm always just curious, like,
do you have a favorite book about leadership or business
that's close to your heart that you might have read
a long time ago or yesterday that that you know,
you kind of always pull to.
Speaker 2 (38:53):
Well, we run on EOS Entrepreneurial Operating System, so of
course I love you know, traction and rocket fuel. But
I just read Brenane Brown daring greatly and I really
really loved that book. I think that you know, culture
with the importance of culture and my business was not
something that I necessarily could model, but it is definitely
(39:17):
something that I've learned is so important in how to
separate your your company from being mediocre to being to
being great.
Speaker 1 (39:26):
So, you know, it sounds like from you know, your
when you're first getting into the industry. One of the
attractive things to it was the travel work. Travel can
be a lot of fun, can be dragged too at times,
you know, depending where you're staying. Do you have a
favorite place that you go for fun around the world.
Speaker 2 (39:46):
Well, definitely Buenos Aires. I mean it's, you know, one
of my favorite places in the world. I love New
York and I really love a couple of great trip
that I took a couple of years ago as to Georgia,
the country state, and it's somewhat I'm discovered by Americans
(40:06):
and it's really phenomenal, the people, the food, the culture,
the majestic beauty of the mountains, and wine making is
you know, it's some of the old wine, oldest wine
making in the world. So I've got to say that
george is one of my favorite places ever.
Speaker 1 (40:25):
I'll have to I'll have to check that out because
I know that with globalization, you can go anywhere and
you sometimes you feel like you're not too far from
New York. Sometimes that's right, yeah, exactly.
Speaker 2 (40:37):
Unfortunately, I'm I'm a little bit concerned that, you know,
the world is becoming a riskier place, and so if
there's some place you want to go that's uh, you know,
like Georgia for example, don't don't put it off too long.
Speaker 1 (40:49):
Good to know. Well, well, DDI, I really want to
thank you for your time and insights. This is a
great conversation, great Thank you so much.
Speaker 2 (40:56):
It was a pleasure being here and.
Speaker 1 (40:59):
I want to thank you for too tuning in. If
you liked the episode, please subscribe and leave a review.
We've lined up a number of great guests for the podcast,
so check back to hear conversations with c SPIT executives, shippers, regulators,
and decision makers within the freight markets. Also, if you
have an idea for a future episode, please hit me
up on the Bloomberg terminal. We're on Twitter at logistics Lee.
(41:19):
And quickly before I go, I just want to give
a shout out to White, what might be the youngest
fan of the Talking Transports podcast. The other week, I
was at my thirteen year old son's basketball game and
one of his buddies came up to me and told
me that he loved the podcast. So thanks for that,
and I hope you keep listening, Nate, So thank thank you.
(41:39):
So with that, I have a great day, great week,
and a great year. Take care everyone,
Host
Lee Klaskow
Popular Podcasts
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com