CONCRETE PAVEMENT PROGRESS 12 WWW.ACPA.ORG BID ENVIRONMENTS Agencies Can Reduce Costs by Improving the Competitiveness of Their Bid Environments A version of this article was authored by Eric Ferrebee P.E., Senior Director of Technical Services, American Concrete Pavement Association and Jim Mack, Past President of the Board, American Concrete Pavement Association and Director, Infrastructure and Sustainability, CEMEX and published in Roads & Bridges magazine as “Embrace Competition,” January 2024. CONCRETE HAS A PROVEN RECORD OF BEING A VIABLE PAVING MATERIAL. IN FACT, IN THE MID-20TH CENTURY WHEN THE INTERSTATE SYSTEM WAS NEW AND BEING BUILT, CONCRETE WAS THE MOST COMMON PAVING MATERIAL. Its decline in use is largely attributable to a decline in information dissemination and knowledge on concrete repair, maintenance and replacement activities, as well as the fact that concrete repair techniques were still being developed. The declining use of concrete occurred gradually, concurrent with the rising use of asphalt, as budgets shifted toward preservation rather than rehabilitation and reconstruction. However, with renewed education efforts, and a greater need for more permanent solutions, inter-industry levels of competition (that is, competition among firms that pave with different materials) can increase, and costs across the board will lower. Research Results Show Competition Works to Lower Costs in the Paving Industry Improving inter-industry competition brings both additional contractors to the bidding process and a second level of competition into the supply chain (e.g., the asphalt, concrete and cement suppliers). While these suppliers may not directly compete against one another, the sustained competitive pressures between the industries and down the value chain drive costs lower as supply chains get established, skilled personnel develop, construction quality improves, innovation is spurred and risks decline. The MIT Concrete Sustainability Hub (CSHub) examined state Department of Transportation (DOT) pavement bid data collected between 2005 and 2018 to see how the split of DOT paving expenditures between industries impacted paving unit costs. The first result the MIT CSHub found was that while DOT spending on concrete and asphalt paving materials varied greatly from state to state, only two states (Iowa and Wisconsin) spent more than 40% of their paving budget on concrete pavements, while 22 states spent more than 90% of their paving budget on asphalt Fig. 1: 50-Year Trends in Competitive Materials Mapped Against General Inflation Rates. Image courtesy of Jim Mack, CEMEX.
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