Car shipper sees up to $10 million hit from Baltimore disaster
Norwegian car shipping firm Wallenius Wilhelmsen estimates a $5 million to $10 million hit to core earnings from last week's U.S. Baltimore bridge collapse, with its biggest car carrier ship stuck in Baltimore's harbor, likely for weeks. Norwegian car shipping firm, Wallenius Wilhelmsen, estimates a $5 million to $10 million hit to core earnings from the U.S. Baltimore bridge collapse. The company expects the key ship channel to remain closed for weeks and its vessel Carmen, one of the world's largest car carriers, remains stuck in Baltimore's port. Recovery teams have opened a second channel for smaller vessels to navigate the Port of Baltimore, but most commercial shipping remains blocked. The Port, which is the top U.K. for handling auto and light trucks, is also expected to reopen once the channel is reopened. Insurers and reinsurers are expected to face billions in claims, with one estimate putting the cost at up to $4 billion.
Published : 4 weeks ago by Reuters in Auto
LONDON — Norwegian car shipping firm Wallenius Wilhelmsen estimates a $5 million to $10 million hit to core earnings from last week's U.S. Baltimore bridge collapse and expects the key ship channel to be closed for weeks, it said on Wednesday.
The company said its vessel Carmen — which according to shipping data is among the biggest car carriers in its fleet — remained stuck in Baltimore's port, with the ship and its crew ready to sail as soon as the channel was reopened.
Recovery teams opened a second channel enabling smaller vessels to navigate the Port of Baltimore on Tuesday, but most commercial shipping remains blocked by the collapsed bridge and stranded container ship Dali that brought the structure down a week ago.
"We have estimated that the aggregated provisional total financial impact on EBITDA of the situation is in the range of $5-10 million, assuming the disruptions last for up to a month," Wallenius Wilhelmsen, one of the world's leading vehicle carriers, said in a statement on Wednesday.
"We currently expect the closure to last for weeks and have based our impact estimates on that assumption," it said.
"Once open, we anticipate the terminal will also promptly resume normal cargo operations as vessels begin to make port calls as previously scheduled."
"There is of course risk of delays to the anticipated reopening, or unforeseen challenges in the salvage operations."
The Port of Baltimore ranks first in the U.S. for the volume it handles of autos and light trucks, farm and construction machinery, imported sugar and imported gypsum, according to the state of Maryland.
Some terminal operations outside the affected area have resumed.
"Cargo on the water bound for Baltimore is currently being re-routed to other U.S. ports such as Newport News, Newark, and Savannah," Wallenius Wilhelmsen added in its statement.
Insurers and reinsurers could face billions of dollars in claims, analysts said, with one putting the cost at as much as $4 billion. That would make the tragedy a record shipping insurance loss.
In an April 1 filing with a Maryland district court, the Dali's owner Grace Ocean Private Limited and its manager Synergy Marine Pte petitioned to limit their liability to a maximum of $43.6 million.
"The casualty was not due to any fault, neglect or want of care on the part of the petitioners," the filing said.
Insurance industry sources said this was an opening effort to limit exposure.