When automaker BMW announced a massive expansion of its Upstate manufacturing plant on Monday, the move was lauded as a boon for the Port of Charleston.
What wasn't mentioned during Monday's flag-waving was that the State Ports Authority's chief rival, the Georgia Ports Authority, will benefit too — at Charleston's expense.
The German luxury auto manufacturer said Wednesday that it is diverting some of its imported vehicles destined for U.S. dealers from Charleston's Union Pier to Georgia's Port of Brunswick, part of a "rebalancing" of its East Coast operations.
Yet BMW officials maintain that the net number of vehicles that come through Charleston year over year will not decline.
What is lost in imports will be replaced in exports, the company said.
BMW imported about 100,000 German-made vehicles through the local port last year and shipped out roughly as many South Carolina-made models.
In order to better serve its Southeast market, predominately Florida, this year the company will divert about 20 percent of its inbound vehicles to Brunswick, where it already owns an automobile processing center, said Robert Hitt, media and public affairs manager for BMW Manufacturing Co. in Greer.
The move will reduce the costs of transporting the cars to dealers in the Southeast.
"It's not just where you dock the ships. It's the cost after you dock the ships," Hitt said. "At some point you reach saturation and you have to rebalance."
The company imported and exported roughly a combined 200,000 vehicles last year, and there will be at least as many in 2008, Hitt said.
Nevertheless, the move has left some at the waterfront with a familiar feeling.
Six years ago, luxury sports car maker Porsche Cars of North America Inc. closed its North Charleston import center, stating at the time that it would save $6 million a year and be closer to more customers by unloading its sporty vehicles in Baltimore and Brunswick.
Brunswick's Colonel Island Terminal has thrived as a major East Coast destination for foreign car imports. In addition to Porsche, it is now a primary point of entry for about a dozen manufacturers, including Jaguar, Land Rover, Mitsubishi and Volvo.
Ken Riley, president of International Longshoremen's Association Local 1422 in Charleston, said the move by BMW is "very alarming to the maritime community."
"We make our money when ships are at the dock," Riley said.
BMW said Monday it will increase production capacity at its Upstate plant from 160,000 vehicles a year to 240,000 vehicles a year by 2012.
As a result, SPA officials said they expect the volume of finished BMWs exported through Charleston to swell by about 50 percent to about 150,000 vehicles a year. Also, the number of imported containers ferrying automotive parts destined for the carmaker's suppliers will likely double.
But losing thousands of imported vehicles a year, and to the SPA's closest rival, will result in thousands of lost man-hours, Riley said.
When a vessel packed with BMWs calls at Charleston, about 100 ILA members unload the luxury vehicles, Riley said. The process can take about four hours. Riley worries about the lost income for his members.
"And it's very difficult to get that back," he said.
South Carolina has invested tens of millions of dollars in BMW in the form of tax credits, land acquisition and other financing since the plant opened in 1994 off Interstate 85 between Greenville and Spartanburg. The SPA even owns the land under the automaker's 3 million-plus-square-foot factory. The maritime agency leases the site to BMW for $1 a year.
Byron Miller, the SPA's director of public relations, said Wednesday that the local port community certainly would be affected by a decline in imports from BMW, "but there will be growth in other areas."
Hitt said BMW signed a new 10-year contract in 2004 with the SPA that guarantees business with the port, and he expects similar agreements to be in place "until the cows come home."
Charleston remains a vital partner in BMW's operations, he said.
"Is anybody going to look up in two years and say, 'Where are the BMWs?' No," Hitt said.