Target, Walmart Investments Show South Carolina’s Port Appeal
At the Wando Welch Terminal in the Port of Charleston, South Carolina, massive blue cranes tower above while colorful containers sit nearby, stacked like a child’s blocks. As a massive container ship approaches, workers dart about, preparing to remove more containers from its deck.
This scene plays out dozens of times each week across the port’s five terminals: Wando Welch, Leatherman, Union Pier, Veterans and North Charleston. And the South Carolina Ports Authority is intent on increasing that number, making major investments to create new facilities, upgrade existing ones and make it easier for larger ships to access port terminals.
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As of 2022, Charleston ranks eighth among United States ports, four spots below regional competitor Savannah, Ga., and just two behind Norfolk, Va. That year, Charleston processed 2.8 million twenty-foot-equivalent units (TEU), an increase from 1.6 million TEUs in 2013. The busiest U.S. port, Los Angeles, processed 9.9 million TEUs last year.
And while the logjam issues at West Coast ports have mostly resolved, other issues such as potential labor strikes have made some nervous. The Pacific Maritime Association and the International Longshore and Warehouse Union finally struck a tentative deal on June 15 after two weeks of worker slowdowns and stoppages that impaired port productivity up and down the West Coast.
These labor issues, along with shifts in where imports originate, have ports such as Charleston positioning themselves as a more viable alternative to West Coast competitors.
“Beyond the near-term labor challenges, this isn’t new. Even on a good day, it’s challenging to do business on the West Coast,” said Byron Miller, chief commercial officer, South Carolina Ports Authority. “And Southeast Asia production has grown, which favors Southeast United States ports.”
The South Carolina Ports Authority has an owner-operator model, which Miller said allows them to run more efficiently. The bulk of its workers are non-union, making labor disputes less of an issue.
“Compensation is based on productivity—the more they move, the more they get paid,” said Travis Frank, commercial sales, South Carolina Ports Authority
To compete with not only the West Coast but also other Southeast ports such as Savannah, Norfolk, Jacksonville and Wilmington in North Carolina, Miller said the Port Authority has made significant investments in upgrades. The Port of Charleston has seen more than $3 billion of capital investment over the past 15 years.
“It’s a wholistic approach to our growth, whether it’s expanding existing facilities, building new facilities or deepening the harbor,” he said.
The Ports Authority recently completed a dredging project on Charleston’s harbor that deepened the port by 52 feet, making it the deepest on the East Coast until Norfolk completes its inner channel dredging, which is scheduled to begin next year. And the Charleston Port took the dredging project as an opportunity to improve the area’s natural environment, as well.
“We took the dredged material and used it to plant native plants to create new wetlands,” Frank said.
The Ports Authority also recently rolled out a new 10,000-unit chassis fleet after the pandemic heightened the need for chassis availability.
“We invested $210 million in the new chassis fleet,” Miller said. “Now that pool is modern, fully GPS-tracked and properly sized for the needs of the market.”
The port’s market expanded significantly in 2022 with the opening of facilities by two of the nation’s largest retailers. Walmart opened a 3-million-square-foot distribution center in nearby Ridgeville, which processes product for 850 Walmart and Sam’s Club locations across the Southeast.
Target also opened a distribution facility in the area last year, launching a portable cross-dock hub built on a future expansion site at the North Charleston terminal. The facility was set up in partnership with Dockzilla, a Minnesota-based company that builds portable loading systems and warehouses.
“We’re seeing growth in retail successes, companies wanting to build that in the Southeast,” Miller said.
South Carolina’s seaside ports connect with two inland ports, one in Greer along the I-85 corridor and the other in Dillon, along the I-95 corridor. The facilities are served via daily and overnight rail and offer gates that operate 24 hours a day, seven days a week, with 12-minute truck turns.
Miller said Greer is positioned to be an alternative to Atlanta and Charlotte inland ports, which also sit along the I-85 corridor. The facility has handled more than a million containers over the past decade, serving brands such as Adidas, Dollar General and BMW.
The South Carolina Ports Authority also runs a smaller operation at the Port of Georgetown, about 60 miles north of Charleston. The Georgetown Port serves as the state’s dedicated breakbulk and bulk cargo port.
Along with inland support, South Carolina offers monetary incentives to draw business to the Port of Charleston. A South Carolina Ports tax credit gives businesses up to $100 per TEU for new business each year, along with reductions in employee withholding or state income taxes.
In April, the Port of Charleston reported an 11 percent increase in volume month-over-month, moving 214,101 TEUs and 119,572 pier containers. And as companies look for alternatives to the West Coast or simply want to tap into the ever-growing Southeast United States regional market, Charleston and the South Carolina Ports Authority are ready to step in to meet their needs.
“We see that there are a lot of advantages in the Southeast, and in Charleston we have immediate container availability,” Miller said. “As companies continue to invest and grow their businesses in South Carolina, we’re prepared to grow with them.”
