It is estimated that as much as $5 Billion will be spent on transportation and $11 Billion on the repair of equipment returning from Afghanistan. Overloaded military depots, coupled with a shrinking budget require that the Department of Defense (DOD) take a new look at how it does business. North Carolina’s Eastern Region (NCER), with support from the NC Department of Transportation and several local economic development organizations, recently completed a study on the subject that concluded economic opportunities in this area existed for eastern North Carolina. These allies have taken several steps to capitalize on the possibilites.
It is estimated that as much as $5 Billion will be spent on transportation and $11 Billion on the repair of equipment returning from Afghanistan. Overloaded military depots, coupled with a shrinking budget require that the Department of Defense (DOD) take a new look at how it does business. North Carolina’s Eastern Region (NCER), with support from the NC Department of Transportation and several local economic development organizations, recently completed a study on the subject that concluded economic opportunities in this area existed for eastern North Carolina. These allies have taken several steps to capitalize on the possibilites.
Mark Sutherland, NCER Vice President, recently attended the National Military Logistics Summit in Washington, DC and proffered that “leadership acknowledges the old ways of doing business will not work going forward. Basically, the message [regarding retrograde from Afghanistan] was that lots of things would be happening in lots of places – which I take as the absence of a plan at all.” In that quest for a plan lies opportunity for eastern North Carolina.
The Defense Business Board Global Logistics Working Group recommended in 2011 that “the military embrace private sector best practices that reduce costs including the use of an integrated supply chain, shorter transport distances, skilled labor, favorable business climate, and being closer to the customer.” One of the answers to this challenge has been the privatization of appropriate elements of supply chain activity. North Carolina’s military region has much to offer both the defense industry and DOD in this quest.
Eastern North Carolina hosts seven military installations, two maritime ports and four aerial ports of debarkation. It is home to nearly half of the nation’s east coast active duty ground warriors. It is indeed the center of gravity of the nation’s east coast ground military establishment. Its logistics infrastructure (roads, rails, ports and airfields) currently operates at 30% of the system’s designed capacity. This capacity, coupled with proximity to the military end user, render North Carolina in a very favorable position to support retrograde / reset activities.
The North Carolina Logistics Initiative (NCLI) seeks to promote the state’s capacity to support the supply chain activities of its military industry, particularly in this time of overworked depots. Whether it is warehousing, distribution, transportation, transloading, maintenance, the provision or food and fuel, health care or any related logistics function, the NCLI presents a solid business proposition to industry and government for considering eastern North Carolina as a logical place to do supply chain business.
“The North Carolina military cluster is a prime component of the economies of Carteret County, surrounding counties and the entire eastern region,” said Myles Stempin, Executive Director, Carteret County Economic Development.
“One would be hard pressed to find another economic generator that would even come close to approaching its magnitude. The North Carolina Logistics Initiative not only makes a strong case for greatly enhancing the military mission through efficiency and cost-savings but also with a reduced environmental impact. In addition to enhancing the DOD’s public/private opportunities the NCLI will provide an even greater capability for the cost-effective operations of pure private sector non-military companies. More new investment and more economic impact for the region,” Stempin added.
Firms like Oshkosh Defense have caught the wave. At its new Regional Logistics Center in Onslow County, Oshkosh Defense provides user to depot-level maintenance to a joint customer base that includes the Marine Corps, Army, Navy and Army National Guard, stretching from NC to Pennsylvania. Half of the company’s employees transitioned from the military directly into their civilian jobs at Oshkosh Defense, further illustrating the availability of a ready-made workforce in eastern NC. Many other firms have chosen to perform their work in NC’s military region for the same reasons.
“Onslow County is poised to be a great partner in the NC Defense Logistics Initiative and a recipient of the benefits it will bring to eastern North Carolina. As the home of Marine Corps Base Camp Lejeune and New River Air Station, we are the portal for more than 8,000 exiting Marines each year. Many of these highly trained, disciplined workers will choose to remain nearby if there is challenging employment available, especially when it enables them to use the specialty skills and knowledge they acquired in the military. Therefore, Eastern NC is a perfect location for private industry to perform this essential maintenance and reset functions in close proximity to their customer,” said Sheila Pierce, Executive Director, Jacksonville-Onslow Economic Development.
With retrograde set to begin in earnest late this year, decisions are being formulated now and will be rendered within a few short months. The importance of informing government and industry decision-makers about the tenets of the NCLI and the combined capacities of eastern NC’s counties to support a smarter and leaner DOD supply chain has never been more pronounced than it is right now.
North Carolina’s Eastern Region is a 13 county economic development agency serving counties from I-95 to the coast. For more information about NCER, please visit our website: www.nceast.org.