The reawakening of a long-dormant pier has Hyundai and Kia autos rolling off ships from South Korea in record numbers at the Philadelphia port this summer.
According to PhilaPort, the state agency that operates the Port of Philadelphia, 200,000 vehicles are expected in 2017, up from 150,000, with the recent reopening of Pier 122 in South Philadelphia, which provides a second ship berth for automobile imports and exports.
Since late June, seven car carriers with 10,770 new Hyundai and Kia autos have arrived at Pier 122, a finger pier on the Delaware River and a former Pennsylvania Railroad ore dock that hadn't been used by ships in 20 years. Pier 122 and adjacent Pier 124 were built in 1929.
"It is bringing an old terminal back to life," said Gregory Iannarelli, the port's senior director of business development and chief counsel. "From a global significance, it solidifies the port to a new level for automobile business."
Last fall, the Wolf administration announced a $300 million cash investment in the Philadelphia port to upgrade ship berths, buy cranes, update and relocate warehouses, and double container cargoes — efforts projected to create 2,000 direct waterfront jobs and 7,000 total jobs for truckers, rail workers, suppliers, and port-related businesses.
Of the $300 million capital-improvement plan, $93 million was allocated for cars, including use of 200 vacant acres known as Southport at the eastern end of the Navy Yard and development of a vehicle-processing center.
Since 2010, the autos had gone to the Packer Avenue Marine Terminal. Having a second berth in addition to Packer for vehicles and roll-on/roll-off cargoes such as machinery and farm equipment will allow two car ships to dock simultaneously.
"It certainly gives us the ability to start attracting more business through the port," said Scott Cornell, vice president at Hyundai Glovis, the logistics firm that brings autos here. His company has been talking with other carmakers about imports and potentially exports through the port. "We have interest from almost every manufacturer."
Philadelphia competes for auto business with the ports of New York and New Jersey, Baltimore, and Wilmington, Del. The Hyundai and Kia vehicles are coming here from South Korea, Mexico, and factories in Alabama and Georgia. The plan is for Philadelphia to become a distribution center for the mid-Atlantic and Northeast, Cornell said.
About $3 million was spent on improvements to Pier 122 by the tenant USD Group and by Glovis Hyundai, including paving, lighting, fencing, and berth fendering. The State of Pennsylvania, as landlord and owner of 16 piers and terminals on the Delaware River, purchased Pier 122 from Conrail in 2007.
"This is a great piece of business, a great growth story for the port," said Kevin LaBorne, vice president of USD Group, which leases both Pier 122 and the land adjacent to the dock. "We're excited about putting an asset to work that had not been utilized, and doing it in a way that's meaningful, with the creation of jobs and economic growth for the region and also allowing for future development."
Pier 122 is located near two railroads, Norfolk Southern and CSX, and I-95. "And its deepwater dock makes it ideal," LaBorne said.
In April 2015, USD Group took over a 20-year lease from Growmark Inc., a Midwestern agricultural co-op, with plans to bring fertilizer into the pier. When Growmark's plans to bring fertilizer in bulk through Pier 122 fell through, it had been "hit or miss trying to get a business model to work until we were successful with the automobiles," Iannarelli said.
USD Group plans to create a "multimodal" facility at the pier with rail, marine, and truck access that will cater to dry bulk storage. "We won't stop with autos," LaBorne said. Silo domes on the property are empty and could be used to store dry bulk cargoes such coal, ore, grain, and road salt that are shipped in large, unpackaged quantities.
"We are actively seeking partnerships, seeking customers that would have a use for those domes," LaBorne said. "We've had a lot of interest, and we are working through a number of development opportunities right now."