Ford, and General Motors will reroute shipments affected by the Francis Scott Key Bridge collapse and subsequent shuttering of the Port of Baltimore. In the early morning hours on March 26, the Dali, a cargo ship headed for Sri Lanka, lost power and struck a bridge pylon. The bridge crumpled in minutes making the Port of Baltimore inaccessible to shipping traffic. The port, one of the country's busiest, is the primary U.S port for auto shipments. According to Maryland Port Administration data, the port’s vehicle terminals, including Dundalk and Fairfield, moved more than 750,000 vehicles in 2022, with 42% of all of the Port’s imports and 27% of the port’s exports being motor vehicles and parts.
It is still too early to see what overall impact the port closing will have on the automotive sector. "But there will certainly be a disruption," said John Bozzella, CEO of the auto trade group Alliance for Automotive Innovation. "Baltimore is the No. 1 automobile port in the U.S., and we’re in touch with federal officials to help them understand the scale of automotive operations there.”
Ford CFO John Lawler told Bloomberg news "We'll have to divert parts to other ports... It will probably lengthen the supply chain a bit."
GM said in a statement “We expect the situation to have minimal impact to our operations. We are working to re-route any vehicle shipments to other ports.”
“Last year, we received, processed and shipped approximately 100,000 vehicles through Baltimore for US dealers located in the Northeast and Mid-Atlantic U.S,” Volkswagen America released in a statement. “We do not anticipate any impact on vessel operations but there may be trucking delays as traffic will be rerouted in the area.”
"While Baltimore is not a primary port for our North American operations, there will be some impact, primarily on vehicle exports," Toyota said in a statement. "At this time, we do not anticipate a significant disruption, but we are evaluating the situation closely to determine the longer term impact and countermeasures.”
Stellantis said it is "initiating discussions with our various transportation providers on contingency plans to ensure an uninterrupted flow of vehicles to our customers."
BMW said there was no major impact expected as the bridge collapse will not affect its open side ships. It added that land-side truck traffic would be rerouted.
Mercedes said the incident has had no impact on vehicle exports or the company's Tuscaloosa, Alabama, plant's parts supply.
Volvo Group says it currently is expecting minimal impact.
Baltimore Mayor Brandon Scott called the collapse an "unspeakable tragedy”. Rescuers have pulled out two survivors, one of whom remains hospitalized; the search continues for six bridge workers who were patching pot holes on the bridge at the time of impact.
More than 1,150 direct jobs at the Port of Baltimore are generated by the port’s auto business.“There is no question that this will have a major and protracted impact to supply chains," U.S. Transportation Secretary Pete Buttigieg said “officials were looking at significant impacts." The closure of the port will halt some $15 million in daily economic activity.
Open Lending Corporation and TransUnion released a new study on the borrowing habits and credit outlook for Millennials and Gen Zers.
Using data from over 4 million U.S. consumers, the report illustrates new-to-credit borrowers’ upward credit trajectory with insights into lending patterns and preferences.
The report underscores the potential value Millennials and Gen Zers can bring lenders, with key findings showing:
“Many financial institutions are hesitant to extend loans to borrowers with thinner credit files and lower credit scores, who are often Millennials and Gen Zers,” said Kevin Filan, SVP of marketing at Open Lending. “However, this strategic consumer segment shows immense potential for upward credit mobility compared to their older counterparts. The financial institutions that intelligently address these ‘emerging prime’ borrowers through comprehensive data analysis and decisioning can generate higher-yielding loan opportunities and long-term customer loyalty.”
Tesla CEO Elon Musk announced on Monday, March 25, the electric automaker will offer U.S. customers a month's free trial of its driver-assist technology, Full Self-Driving (FSD). "All U.S. cars that are capable of FSD will be enabled for a one-month trial this week," Musk said in a post on social media platform X. Tesla has been selling the FDS option package for $12,000 or a subscription of $199 a month; Musk has been selling the option as a future money maker to Tesla investors. The promise and software has fallen short. Tesla’s safety and marketing campaign for its full driving autonomy software has been under regulatory and legal scrutiny since its inception.
The company has been embroiled in a number of lawsuits involving its FSD tech one the past 6 years. A class action lawsuit, filed against Tesla In September 2022, alleging the company had made “misleading and deceptive” statements about its Autopilot and FSD capabilities was dismissed on September 30, 2023, by U.S. District Judge Haywood S. Gilliam. The judge ruled that the proposed class action lawsuit could not proceed due to an arbitration clause and statute of limitations. In April 2023, a jury found that Tesla was not responsible for a crash in 2019 that injured driver Justine Hsu. In October 2023, another jury found that Tesla was not responsible for the 2019 death of driver Micah Lee, who was allegedly using Autopilot at the time of his crash.
In November 2023, following on the heels of the Micah Lee ruling, Palm Beach county circuit court judge Reid Scott found reasonable evidence that Tesla managers and Elon Musk knew the company's Autopilot tech was defective. The Florida judge pointed out the company still allowed the cars to be driven in an unsafe manner, leading to the accident and death of Stephan Banner. The judge ruled the case could proceed. “It would be reasonable to conclude that the Defendant Tesla through its CEO and engineers was acutely aware of the problem with the ‘Autopilot’ failing to detect cross traffic,” the judge wrote. The trial has not yet happened.
The FSD addition option has been decreasing in popularity with Tesla buyers, only 14% of Tesla customers bought the package in the Q3 -’22, down from a record high of 53% in Q3-’19. "The combination of substantial price cuts on the vehicles and dramatically lower FSD take rates has severely hurt Tesla’s margins," said analyst Sam Abuelsamid at Guidehouse Insights. "The mandate to demonstrate FSD as it is today, is just the latest in a long-running series of end-of-quarter stunts by Musk intended to boost deliveries and revenues."
The Federal Trade Commission will hold a virtual informal hearing on April 24, 2024, on its proposed Rule on Unfair or Deceptive Fees, commonly known as junk fees. During the hearing, which will be open to the public and viewable on the FTC’s website, interested organizations will have the opportunity to provide oral statements.
On October 11, 2023, the Federal Trade Commission announced a proposed rule to prohibit junk fees. The proposed rule would ban businesses from “running up the bills with hidden and bogus fees, ensure consumers know exactly how much they are paying and what they are getting, and help spur companies to compete on offering the lowest price. Businesses would have to include all mandatory fees when telling consumers a price, making it easier for consumers to comparison shop for the lowest price.”
In response to the proposed rulemaking, 17 commenters requested to present their positions at an informal hearing. The Federal Register notice states that these entities will be entitled to make oral presentations at the informal hearing on April 24. Oral statements at the event will be limited to 15 minutes each. These organizations, however, may also submit written documents to the FTC within 14 days after publication of the notice in the Federal Register. Submission instructions are included in the notice. All submissions will be placed on the public record.
The informal hearing will be conducted virtually, starting at 10 a.m. ET, and Administrative Law Judge Jay L. Himes has been appointed to preside over the event. The link to the hearing webcast will be posted shortly before the date of the event on the FTC’s website.
Total new-vehicle sales for March 2024, including retail and non-retail transactions, are projected to reach 1,525,700 units, a 12.1% increase from March 2023, according to a joint forecast from J.D. Power and GlobalData. March 2024 has 27 selling days, the same as March 2023.
The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 16.4 million units, up 1.6 million units from March 2023. New-vehicle total sales for Q1 2024 are projected to reach 3,830,500 units, a 4.5% increase from Q1 2023 when adjusted for selling days.
New-vehicle retail sales for March 2024 are expected to increase when compared with March 2023. Retail sales of new vehicles are expected to reach 1,225,000 units, a 10.7% increase from March 2023.
New-vehicle retail sales for Q1 2024 are projected to reach 3,066,500 units, a 4.5% increase from Q1 2023 when adjusted for selling days.
“In conjunction with robust sales for Q1, elevated transaction prices mean that consumers are expected to spend more than $129 billion buying new vehicles, an all-time Q1 record,” Thomas King, president of the data and analytics division at J.D. Power, said.
“Retail inventory levels are expected to finish around 1.7 million units, a 4.2% increase from February 2024 and a 39.3% increase from March 2023.
“Fleet mix is projected at 19.7%, up 1 percentage point from March 2023 and up 18.4% on a volume basis, as several manufacturers increase their focus on fleet sales as a mechanism to address excess inventory.”