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While US Auto Sales Improve, The Shipping Industry Cheers

US consumers have apparently found the cure for the winter blues, and it comes with that unmistakable new car smell. The ‘Big 8’ automakers' monthly sales figures are nowUS auto sales improve public, and March 2014 numbers tell us that US auto dealers saw their best sales month since February 2007. Overall, the ‘Big 8’ reported a 2 percent increase in sales from March 2013 to March 2014.

This is a very positive indicator of consumer confidence. And according to Jessica Caldwell, senior analyst at Edmunds.com, “this trend is significant because it shows that shoppers are comfortable enough with the economy to buy bigger vehicles that generally cost more and guzzle more gas.”

Let’s look at some highlights from the 22 ports who responded to the most recent Finished Vehicle Logistics Annual Port Survey. It's pretty telling that while US auto sales improve, the shipping industry cheers, particularly for imports and exports.

Popular Ports

Baltimore, MD

It is the largest US port for new vehicles from top automakers such as Chrysler, BMW, and Mercedes-Benz. Automaker Toyota has seen their largest growth from the Port of Baltimore. In addition to exports to Europe, Toyota has begun exporting to Australia, New Zealand, and Israel from the Port of Baltimore. Baltimore reported export volumes of nearly 320,700 units mostly from Detroit automakers as well as Toyota.

Brunswick, GA

Primary users of the Port of Brunswick are Hyundai/Kia, Mercedes-Benz, and the Volkswagen Group, and the port has reported exports at 118,000 units. High-volume increases of more than 20 percent at the Port of Jacksonville have prompted some shipping lines to begin using the Port of Brunswick.

Jacksonville, FL

With a reported total of 260,000 auto export units, this port realizes that Toyota, Nissan, and Ford weigh in as the principle automakers. Jacksonville is one of several southern US ports that have seen steady increases in volume as automakers have moved manufacturing into southern states.

New York/New Jersey

The New York/New Jersey port is North America’s fifth largest vehicle port. They have experienced increases in their export activity as well with most growth coming from General Motors, Ford, and Japanese automakers – Toyota, Nissan and Mazda.

Imports, Still Stronger

The Finished Vehicle Logistics survey isn’t just about exports. The fact is that auto imports into the United States still outweigh exports by four times, and those volumes are good for the shipping industry. Those ports that primarily traffic vehicle imports saw significant increases in volumes as reported. The Port of Houston, for example, due to Volkswagen imports from Mexico saw an increase in volume of 143 percent.

California ports of Long Beach and San Diego saw Toyota imports increase by more than 50 percent and 17 percent, respectively. And increases from Honda and Subaru have benefited the Port of Richmond.

Roadblocks (Infrastructure)

The challenge of maintaining and expanding port infrastructure to keep up with increases in volumes is ongoing. The South Carolina Ports Authority (SCPA) recognizes the need to keep up with demand and is working with Norfolk Southern Railway. Their collaboration will result in a new facility near the BMW plant in Greer, SC.

Another example of expansion for vehicle processing can be found in Portland. A newly approved $2.8 expansion facility for Auto Warehousing Company will increase the annual capacity to more than 110,000 vehicles.

Port operators, shippers, and automakers alike stand to benefit from growth in new vehicle sales, and Edmunds.com has already forecasted 16.4 million new car sales in 2014.

That's a lot of new car smell.

If you would like more information on this subject matter, please click HERE to contact me now.

 

Continuation from Part 1 on November 22, 2013

Original text appeared in the January-February 2012 issue of Breakbulk Magazine

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