A 948-foot container ship crashed into Francis Scott Key bridge at a Baltimore, MD, port early in the morning on Tuesday, March 26. The crash has resulted in numerous casualties and injuries. In addition to the tragic impact the crash had, the destruction of key infrastructure has the potential to bring long-term consequences to the shipping industry.¹ 

The automotive industry is one of many sectors that will be affected. In this article, we will explore the existing information and expectations around delays or changes in vehicle shipments.

The Importance of the Port of Baltimore for the Auto Industry

As a result of the crash, all traffic to the Port of Baltimore has been suspended indefinitely. For context, this port is the busiest in the US for shipments of cars—covering more than 750,000 vehicles in 2022, and 847,158 autos and light trucks in 2023—more volume than any other port.¹

Because of this, numerous supply chains are predicted to be disrupted in industries spanning automotives, coal, sugar, and more. This will likely “create bottlenecks and increase delays and costs in the Northeastern seaboard” according to Automotive News.¹

Which Car Manufacturers will be Impacted?

The Baltimore port handles the import and export of parts from auto companies like Nissan, Toyota, GM, Ford, Subaru, Mazda, Volvo, Land Rover, and the VW group. While we know that shipments to and from this location are currently paused, the impact of further disruptions across the industry is likely to increase, and the full potential effects are not yet known.¹

Some companies have outlined the impacts they foresee or have already begun to experience: 

• VW: The location of its facilities means that they have thus far remained unaffected. 
• Ford: Parts will have to be diverted to other ports, disrupting the supply chain. 
• GM: Anticipating minimal impact. 
• Mercedes-Benz: Continuing to monitor the situation to determine other route options. 
• BMW: Anticipating short-term traffic delays but no additional immediate impact. 

Where will the shipments go?

Numerous other ports across the East Coast are going to be responsible for absorbing the rerouted shipping traffic, but this will certainly cause shipping delays and “upheaval,” according to the Associated Press.²

Ships that were supposed to go to Baltimore are waiting to be redirected elsewhere—if they haven’t been already. The delay for any ships originally scheduled in Baltimore is estimated to be at least 24 days.²

In the meantime, many ships are just drifting as they await further instructions and new port destinations. Some ports that may absorb Baltimore’s traffic include:

• Philadelphia, PA
• Wilmington, NC
• Newark, NJ
• Norfolk, VA
• Charleston, SC
• Jacksonville, FL
• Several in Georgia 

Baltimore will still be handling some autos, like BMW and VW, since their port location was relatively unaffected.² 

What impact will these delays and reroutes have on costs?

Finding appropriate substitute ports should help avoid many increases in the cost of goods. But many are wondering: Will any additional costs cause dealerships to have to raise prices for consumers? Probably not in the near term.

In the long term, the cost of goods will depend on the length of the Baltimore port closure and the capacity the other ports have to take over and process shipments on time. The outcomes will also depend on the individual auto companies, and how well they can find other solutions and workarounds. Subaru of New England expressed concerns about the ability for dealerships on the East Coast to access parts and new vehicles on schedules.⁴ Companies that were more dependent on Baltimore as their primary shipment location will face a bigger challenge, and those challenges could cause dealerships to have to raise costs for customers—but the full impact on costs is not yet known. 

The cost of goods will also depend on how many vehicles are already available for that company on lots across the US, or how heavily they were depending on imminent incoming shipments.³ Logistics don’t make up the primary costs for cars, so even if these associated costs rise, it won’t inherently mean an increase in the majority of a car’s cost for consumers. 

After costs soared during the pandemic, many are concerned that other disruptions could mirror this effect and disrupt dealerships once again. However, auto dealers should feel confident that this event is not likely to cause such extreme disruption.³

ACV is your dealer partner

Even if the Port of Baltimore disruption begins to have an impact on your business, ACV can partner with you to help supply used car inventory. As an online car auction, each vehicle is individually inspected by a Vehicle Condition Inspector on our team and is accompanied by a condition report that includes interior and exterior photos, high-definition engine sounds, an OBDII scan, and more to help you bid confidently. Additionally we can help dealers move inventory with ACV Transportation. We have a  network of more than 3,000 rigorously vetted carriers that can move your inventory from any destination. Get started with ACV today.

Sources

1. Automotive News Staff. 2024. “Baltimore bridge collapses after ship collision; auto shipping hub operations face disruption.” Automotive News. Retrieved April 1, 2024. https://www.autonews.com/automakers-suppliers/baltimore-auto-shipping-hub-faces-disruption-after-bridge-accident 
2. Krisher, Tom. 2024. “Baltimore bridge collapse: Ships carrying cars and heavy equipment need to find a new harbor.” Associated Press. Retrieved April 2, 2024.  https://apnews.com/article/baltimore-bridge-collapse-cargo-port-056eb1e7c5424f23ce4c049fe53bb02f 
3. LaRequ, Jamie L. 2024. “Baltimore bridge collapse closes automakers’ top port: How it may impact new car prices.” Detroit Free Press. Retrieved April 2, 2024. https://www.freep.com/story/money/cars/general-motors/2024/03/29/auto-industrys-port-baltimore-closed-new-car-prices/73131106007/ 
4. Germano, Beth. 2024. “How will the Baltimore bridge collapse impact Massachusetts car shipments?” WBZ News. Retrieved April 5, 2024. https://www.cbsnews.com/boston/news/baltimore-bridge-collapse-ernie-boch-jr-massachusetts-car-shipments-supply-chain/