In an era where infrastructure spending is heavily scrutinized, a call for increased competition in pavement construction arises as a potential solution. Concrete, once the primary paving material during the 1950s interstate construction boom, has seen a decline in usage due to a lack of understanding regarding repair, maintenance, and replacement write long-term ISCP members Eric Ferrebee and Jim Mack, contributing authors, in Road & Bridges. They argue that reviving interindustry competition between firms using different materials can lead to cost reductions in construction.
Research from the MIT Concrete Sustainability Hub (CSHub) analyzed Department of Transportation (DOT) pavement bid data from 2005 to 2018, revealing significant variations in spending on concrete and asphalt across states. States with higher levels of interindustry competition were found to have more stable and predictable paving programs, indicating a correlation between competition and lower unit costs for both materials.
Moreover, the CSHub found that an increase in interindustry competition could significantly decrease unit costs for concrete and asphalt paving materials. For example, a state with a low concrete market share of 1% could experience a 29% reduction in concrete paving costs by increasing its market share to 25%. This emphasizes the potential benefits of encouraging competition between paving materials.
The article also addresses the rising prices in asphalt paving over the past 50 years, as reported by the Bureau of Labor Statistics. The volatility of liquid asphalt prices and its high demand contribute to yearly price swings exceeding 40%. The authors suggest that choosing concrete pavement based on its durability and longevity can contribute to cost reduction, especially when life cycle cost analysis is employed.
Implementing a competitive paving program at both the programmatic and project levels is recommended. Agencies are advised to plan deliberately, communicate their commitment to fostering competition, and assign a specific number of concrete projects each year to develop a competitive market. Technical task forces are essential to address specifications and design issues.
Finally, the article points out that several states have successfully implemented strategies to balance the market by targeting specific numbers or volumes for concrete installations, offering models for others to follow. The research suggests that encouraging competition between paving materials is a viable strategy to lower unit costs and achieve more cost-effective pavements.
Read more here: https://www.roadsbridges.com/current-issue/article/33016330/embrace-competition