Is the Baltimore bridge collapse impacting the supply chain?

President Joe Biden is anticipated to travel to Baltimore on Friday to visit the site of the Francis Scott Key Bridge collapse, which tragically resulted in six presumed deaths and is poised to significantly impact the economy of the port.

There are lingering concerns about the repercussions of this incident on the nationwide supply chain, prompting experts to offer their insights.

Texas Christian University’s Center for Supply Chain Innovation, housed within the Neeley School of Business, has been closely monitoring the situation.

The collapse of the bridge has effectively blocked access to and from the Port of Baltimore, a critical hub for various goods such as forestry materials, farm equipment, and sugar. Moreover, the port is renowned as the primary domestic port for automobiles due to its proximity to the Midwest auto industry. Consequently, the disruption could potentially affect the flow of cars.

Tyson Browning, an operations management professor at TCU, noted that while some auto dealerships have substantial inventories, smaller companies without such resources may bear the brunt of the impact. Rerouting goods to alternative ports could incur additional costs and delays for many companies, although experts are striving to mitigate these impacts across the supply chain.

Fortunately, experts do not foresee a significant disruption to the supply chain overall. Cargo traffic can be redirected to ports in New York, New Jersey, and Virginia, which have expanded their capacity to accommodate additional shipments. Although there may be added expenses and logistical challenges, efforts are underway to minimize disruptions throughout the supply chain system.

Browning emphasized that Texas, with its port in Houston and the transportation of goods from the West Coast by rail, may not experience a substantial impact. However, the Baltimore bridge collapse adds another layer to existing supply chain challenges occurring globally.

Browning cited the drought in Panama, which is affecting the Panama Canal’s operations, and geopolitical tensions in Gaza, which impact movement through the Red Sea and the Suez Canal, as additional factors contributing to supply chain complexities.

In Baltimore, experts estimate that it will take several months to clear the wreckage, further impeding the flow of cargo to the port until the debris is removed.