Crain’s Detroit Business recently published an article that highlights a report prepared by Ford School students. The students found that stringent policies and enforcement by the CBP office in Detroit-–compared with the office in Chicago, which regulates Ohio ports–has resulted in economic losses for the Port of Monroe and the State of Michigan more broadly.
The students, Nathan Lindfors, Monica Pagani, and Brandan Pierce, did their work through the Program in Practical Policy Engagement (P3E).
Lindfors, Pagani, and Pierce explored two case studies. The first highlights a pilot program by the Ford Motor Company to export Mustangs to Germany. On two occasions in the summer and fall of 2016, Ford sought to export 100 and 120 Mustangs respectively through the port in an effort to “limit how often cars were touched in transit and to reduce emissions from rail or truck transit” to other seaports. In both instances, CBP’s inspection requirements, and inability to effectively staff the Port of Monroe led to the diversion of the vehicles to other ports, and the subsequent cancellation of pilot program. With European purchases of Ford Mustangs exceeding 15,200 in 2016, and expected to grow, the failure of the pilot is significant setback for the Port of Monroe.
The second case highlights efforts by Arauco to import supplies for the construction of its new particleboard mill in Grayling, MI. Once completed, the facility is expected to be the largest particleboard mill in North America. To complete construction of the facility, Arauco planned to import 14 ships full of construction material from Europe, traveling through the St. Lawrence Seaway. In a last minute interpretation of its statute, CBP Detroit altered course on crated cargo set to be unloaded in Monroe, and instead all shipments were diverted to ports in Cleveland and Toronto.
The U-M report concluded that these CBP changes created additional costs to various partners totaling $1.9 to $3.1 million, increased transit emissions, and resulted in approximately $15.4 million in lost revenue for the Port of Monroe that was diverted to Ohio and Toronto instead.
The study is available here.
The article, “Michigan ports closed for business? 2 case studies,” by Tom Henderson with Crain’s Detroit Business, is available here.
The Program in Practical Policy Engagement (P3E) is a university–wide resource housed at the Ford School where it can leverage existing expertise and interdisciplinary approaches to generate policy–relevant research, analysis and learning, as well as improvements in organizational practice.