CEO Column

Supply Chain Resiliency and the Broader U.S. Automotive Workforce

Jennifer Safavian
April 29, 2024

The tragic collapse of the Francis Scott Key Bridge in Baltimore shone a spotlight on the critical role our nation’s ports play in international trade. The effects of the collapse were immediate: transport routes were disrupted, deliveries were delayed, and costs for rerouting and setbacks increased. Access to the port, the 18th largest in the U.S., and second largest for autos, has remained limited since the collapse, and thousands of port workers, contractors, and other employees have been affected.

While Autos Drive America’s member companies have so far experienced minimal disruption from the port shutdown, the disaster illuminated the potential long-term risks associated with such major disruptions and serves as an important reminder of the indirect careers supported by international automakers and other trade-focused industries. Autos Drive America’s members alone indirectly support more than 1.5 million jobs, thousands of which are in shipping, logistics, and port maintenance, and it’s imperative that we ensure the underlying system that our industry and its workforce rely on is safe and secure.

The supply chain network for the U.S. auto industry is a complex web that stretches across the entire country. International automakers specifically have spent decades expanding their supply chains into the South and across the East Coast, in large part to diversify and protect their networks and minimize the impact of disruptions. Whether from global pandemics or material shortages, disruptions have profound ripple effects, threatening job security, economic stability, and the livelihoods of the millions of American workers in sectors supported by the automotive industry. Moreover, the interdependencies of the auto industry with other sectors, such as steel production and electronics, highlight the widespread impact of any single disruption.

To address threats to the supply chain network and the millions of jobs it supports, we must focus on a multipronged approach, starting with critical infrastructure investment. The American Society of Civil Engineers estimates that if the U.S. doesn’t quickly address its investment gap in its infrastructure, the economy is expected to lose more than $10.3 trillion in GDP, including $2.4 trillion in exports and $1.8 trillion in imports, by 2039. At Autos Drive America, we advocate for robust federal and state investment in our nation’s infrastructure and were supportive of the Infrastructure Investment and Jobs Act, legislation that invested $1.2 trillion in America’s infrastructure. Upgrading and maintaining our nation’s bridges, roads, and port infrastructure is essential to prevent future bottlenecks and maintain trade fluidity.

Another way international automakers are ensuring supply chain resilience is by reducing over-reliance on single suppliers or geographies.  After the disruptions caused by the global pandemic, automakers have assessed where risks and bottlenecks exist, and have set up new processes to ensure that they have sufficient supply of the parts at greatest risk of supply disruptions. In addition, advanced technologies that enhance visibility and responsiveness in supply chain management are being developed to help predict and mitigate disruptions before they unfold.

The U.S. automotive industry is made up of so much more than just our manufacturing sector. Millions of workers in industries like shipping, logistics, port and harbor maintenance, and road management keep international automakers’ operations running smoothly and support the global trade ecosystem. Investments in securing and shoring up our nation’s supply chain will have widespread benefits for decades to come—not only for the U.S. automotive industry, but for the strength and resilience of our national economy.