Ford, GM, VW Signal Delays In Supply Chain Due To Bridge Collapse 

By Cee Lippens March 27, 2024
The closing of the Port of Baltimore’s shipping lanes throws another spotlight on “just in time” supply chain vulnerabilities in the U.S. auto industry. Ford SUVs board a cargo vessel at the Port of Baltimore. The closing of the Port of Baltimore’s shipping lanes throws another spotlight on “just in time” supply chain vulnerabilities in the U.S. auto industry. Ford SUVs board a cargo vessel at the Port of Baltimore.

Ford, and General Motors will reroute shipments affected by the Francis Scott Key Bridge collapse and subsequent shuttering of the Port of Baltimore. In the early morning hours on March 26, the Dali, a cargo ship headed for Sri Lanka, lost power and struck a bridge pylon. The bridge crumpled in minutes making the Port of Baltimore inaccessible to shipping traffic. The port, one of the country's busiest, is the primary U.S port for auto shipments. According to Maryland Port Administration data, the port’s vehicle terminals, including Dundalk and Fairfield, moved more than 750,000 vehicles in 2022, with 42% of all of the Port’s imports and 27% of the port’s exports being motor vehicles and parts. 

Cars arrive at the Port of Baltimore. 

It is still too early to see what overall impact the port closing will have on the automotive sector. "But there will certainly be a disruption," said John Bozzella, CEO of the auto trade group Alliance for Automotive Innovation. "Baltimore is the No. 1 automobile port in the U.S., and we’re in touch with federal officials to help them understand the scale of automotive operations there.” 

Ford CFO John Lawler told Bloomberg news "We'll have to divert parts to other ports... It will probably lengthen the supply chain a bit."

GM said in a statement “We expect the situation to have minimal impact to our operations. We are working to re-route any vehicle shipments to other ports.”

“Last year, we received, processed and shipped approximately 100,000 vehicles through Baltimore for US dealers located in the Northeast and Mid-Atlantic U.S,” Volkswagen America released in a statement. “We do not anticipate any impact on vessel operations but there may be trucking delays as traffic will be rerouted in the area.”

Baltimore Mayor Brandon Scott.

"While Baltimore is not a primary port for our North American operations, there will be some impact, primarily on vehicle exports," Toyota said in a statement. "At this time, we do not anticipate a significant disruption, but we are evaluating the situation closely to determine the longer term impact and countermeasures.” 

Stellantis said it is "initiating discussions with our various transportation providers on contingency plans to ensure an uninterrupted flow of vehicles to our customers."

BMW said there was no major impact expected as the bridge collapse will not affect its open side ships. It added that land-side truck traffic would be rerouted.

Mercedes said the incident has had no impact on vehicle exports or the company's Tuscaloosa, Alabama, plant's parts supply.  

Volvo Group says it currently is expecting minimal impact.

Baltimore Mayor Brandon Scott called the collapse an "unspeakable tragedy”. Rescuers have pulled out two survivors, one of whom remains hospitalized; the search continues for six bridge workers who were patching pot holes on the bridge at the time of impact.

More than 1,150 direct jobs at the Port of Baltimore are generated by the port’s auto business.“There is no question that this will have a major and protracted impact to supply chains," U.S. Transportation Secretary Pete Buttigieg said “officials were looking at significant impacts." The closure of the port will halt some $15 million in daily economic activity.

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Last modified on Wednesday, 27 March 2024 17:29