Honda automobiles rolled ashore yesterday at the port of Baltimore for the first time since 1996, as Japan's second-largest carmaker resumed shipments to the East Coast of the United States.
Honda has a three-year contract with ATC Logistics International Inc., which operates the Masonville Auto Terminal in Fairfield that is to bring 70,000 automobiles into Baltimore this year.
The deal will create "about 100 jobs over the next 18 months" connected to the terminal's operation, according to ATC President and Chief Operating Officer Howard L. Gable. State officials estimate that the auto-import contract, announced in August, will add 300 jobs - ranging from longshoremen to trucking jobs - to the Maryland economy.
"We searched the East Coast very carefully for a port that would serve our needs, and, after vigorous criteria, the port of Baltimore was our top choice," said Dave Haney, assistant vice president of auto distribution and logistics for Honda's North American entity, American Honda Motor Co. Inc.
The deal typifies an evolving automaking industry: Yesterday's shipment marked the first time that European-made Hondas were shipped to the United States. It's a two-way relationship: From Baltimore, about 5,000 Hondas made in North America will leave for Europe and South America this year.
Baltimore was attractive because of its inland port location, rail and truck accessibility, and proximity to markets in the Midwest, Honda officials said yesterday.
For the Maryland Port Administration, which built the Masonville terminal for $21 million in 2000, the Honda contract is part of the state's goal of making Baltimore the nation's top destination for auto imports.
The Masonville terminal, which can process 125,000 vehicles annually, is one of five public and private auto terminals in Baltimore that together received 501,769 cars in 2000, the last year for which figures were available.
While the port maintains a "keen focus" on container shipping, it is looking to increase the traffic of other kinds of cargo into the port, said Maryland Port Administration's executive director, James J. White.
"We're presently the No. 3 port in the country for autos," White said. "We want to be No. 1." First and second are New York/New Jersey and Jacksonville, Fla.
In September 2000, Jacksonville-based ATC signed a 20-year lease with the MPA to operate the terminal, which is on 55 acres and includes a state-of-the-art vehicle processing center and staging area. Honda has been using the terminal as a staging area for cars - about 50,000 a year, Haney said - en route to mid-Atlantic dealerships.
To break even, the terminal needs to bring in between 70,000 and 90,000 automobiles annually, ATC's Gable said.
Automakers can also use the terminal's facilities to add accessories to the automobiles - a service that ATC can offer and also make money on, Gable said.
Gable said ATC was in discussion with other carmakers, but he declined to give any details.
Yesterday, a first batch of 189 Honda Civic Si's - a new hatchback model - rolled onto the dock off the Brilliant Ace, an auto carrier owned by Mitsui O.S.K Bulk Shipping Inc.
Honda will use two other shipping companies - Wallenius/Wilhelmsen and NYK of Japan - to maintain a steady stream of auto shipments into the port, company officials said. Ship calls at the port are expected to total between six and eight per month.
The port owes this latest import deal partly to production and logistical changes at Honda.
This year, the terminal will receive 55,000 Honda CRVs - Honda's mini-SUV - and 15,000 Civic Si's. Both models will come from two factories in the United Kingdom, said American Honda's Haney.
Haney said that Honda stopped shipping to the East Coast in 1996 because it cost less to ship from Japan across the Pacific Ocean to the West Coast, and then distribute the cars across the United States by rail and truck.
Thanks to the U.K. factories, Baltimore will be Honda's sole East Coast entry point into the U.S. auto market for the new Civic model. From here, European-made Hondas such as the CRV will be distributed as far west as the Mississippi River, while the new Civic Si is to be distributed nationwide.