The Georgia Ports Authority, which operates the Port of Savannah in eastern Georgia, the fourth-largest U.S. port by volume, revealed plans at a recent trade conference to allocate over $4.5 billion (about 6.13 trillion won) for port and intermodal infrastructure development within the next ten years. This investment aims to enhance the port’s current capacity from 7 million to 12 million TEUs (twenty-foot equivalent units) by 2030.
Several industry players perceive Georgia Ports Authority’s bold investment, contrasting with the traditional focus on West Coast ports, as indicative of a shifting center in U.S. maritime logistics. With West Coast ports facing challenges like reduced imports of Chinese goods and labor strike risks, attention is increasingly drawn to the rapid growth of East Coast ports. These ports have attracted significant investments, particularly in manufacturing sectors like electric vehicles and batteries, reshaping the logistics landscape that links global and U.S. markets.
Over the last decade, the Port of Savannah has demonstrated the highest volume growth rate among all U.S. ports, averaging 4.4% annually. The port handled approximately 4.92 million TEUs the previous year, and Q1 2024 saw an impressive 11% year-over-year increase. Comparatively, the 10-year compound annual growth rate of container freight volume through major western ports like Los Angeles·Long Beach, and Seattle-Tacoma ranged from -2.1% to 1.8%. In contrast, East and South ports, New York·New Jersey, Savannah, and Houston experienced growth rates ranging from 3.4% to 7.6%.
Ranked as the top state for business in the U.S., Georgia attracts significant investment from South Korean corporations like Hyundai Motor Company, LG Energy Solutions, SK Energy, Q CELLS, and Hyundai Mobis. Beyond Georgia, logistics in the Southeast region is gaining importance due to “Auto Alley,” linking automobile production centers from southeastern Florida to north-central Michigan, and Samsung Electronics’ semiconductor plant in Texas.
In response to this trend, South Korean logistics entities and companies are expanding their presence in the eastern United States. For instance, in collaboration with Korea Ocean Business Corporation, CJ Logistics will start to construct a 10,000㎡ (3,000 pyeong) logistics center in New Jersey in the latter half of this year. This set to invest approximately 600 billion won ($417.28 million). Additionally, the company has won 300 billion won (about $221 million) in logistics for local facilities of domestic battery companies in the southeastern U.S. and expects to expand the market in the future.
Busan Port Authority signed a sister port agreement with the Port Authority of New York and New Jersey, which oversees the second-largest port in the U.S., in March. This agreement entails exchanging information between the two ports and close collaboration in addressing disruptions in maritime supply chains, such as those stemming from issues like drought affecting Panama operations and the Red Sea crisis. Additionally, logistics firm Hyundai Glovis expanded its finished vehicle logistics base at the Philadelphia port from 360,000㎡ (110,000 pyeong) to 640,000㎡ (19,000 pyeong) in 2019. This expansion resulted in a threefold increase in the storage capacity of finished vehicles, rising from 13,000 units to 36,000 units.
While enhancing its logistics footprint in the eastern U.S., the lack of core infrastructure, notably port terminals, compared to key rivals is pointed out as a concern. The missed opportunity to acquire the New York-New Jersey Port Terminal underscores this issue. France’s CMA-CGM, ranked as the world’s third-largest shipping line, successfully acquired New Jersey’s GCT container terminal last August, boasting a capacity of approximately 2 million TEUs annually, for around 3 trillion won (about $2.29 billion). South Korea’s largest shipping company, HMM, considered the acquisition, but it ultimately lost out on pricing. CMA-CGM plans to increase its terminal handling capacity by more than 50% over the next 10 years.
