Francis Key Scott Bridge & Financial Impact

On March 26th, 2024 a container ship caused the collapse of the Francis Key Scott Bridge. Maintenance crew working on the roadway lost their lives and two were successfully rescued from the river. This tragedy caused the unexpected passing of six loved ones for their families and with the collapse of a key bridge it is estimated it’s going to cost nearly 2 Billion dollars to make the necessary repairs.?

Whenever you drive over a bridge, I doubt that most people ever think twice about what a marvelous innovation it is. Think about it: if you’re traveling over a bridge, you would most likely have to drive an alternative route, take a boat, or a waterplane before the bridge was built. The amount of time bridges save travelers is astonishing and bridges allow shipping around the world to be more efficient.?

For example, the Francis Key Scott Bridge is a key area for coal companies and their shipment levels.

With the bridge being demolished, the supply chain for this important product is going to put these items into disequilibrium. The port is a major hub for cars, forest products, farm equipment, and sugar. This can cause price spikes because if the supply of a product is decreased and the demand remains the same, from an economic standpoint, the price would have to increase.

Not only are consumers possibly hurt by this tragic event, but the economic impact of the Francis Key Scott Bridge is part of the lifeblood of the state of Maryland. The port supports around 150,000 jobs and gives Maryland an economic value of almost $5 Billion per year. Think about it like this…

You’re driving to work, you show up on time, and your office has been completely demolished. How would you react in that situation? Intrusive thoughts may creep into your mind.?

Such as:

“What Happened!?!?”

“Is anyone hurt?”

“Am I going to still have a job?”

Essentially what is going to happen is the amount of output from the port is going to decrease and the input they have to provide their workers in the form of benefit will remain the same. Thus, affecting the business's ability to produce revenue. Bridges and their economic impact aren’t missed until there is a key event that brings it to people’s attention. Just like we need oxygen to breathe, the United States and the world economy require bridges to be efficient in providing people with the items they need in their everyday lives.?

Not only is the economic impact grave but let's talk about the negative effects it will have on traffic. Increased traffic means increased travel times. Annoying to most and this is a reason why A.I. has been taking the mainstage in the investment world. Efficiency and productivity matters.

Let’s say a trucking company is transporting eggs.

Now, instead of taking 2.5 hours to travel, it takes 3 hours to travel. Now, to one person, it may not seem like an extra 30 minutes is a big deal, annoying yes. However, when you take into account goods and services, let’s say this egg company has 1000 drivers. This means that these 1000 drivers would take about an extra 8 hours a day to transport and deliver the same goods to their final destination.?

Not only that, with more traffic, diesel trucks in particular probably are burning more gas. Just like your car is most efficient at highway speeds, these vehicles are no different. This means the trucking company is spending more money on gas, decreasing the speed at which they deliver products, and then these additional costs trickle down to the consumer in the form of higher prices.

This is exactly what happened in 2020 during the pandemic, where the supply chain was like a tornado that hit a filing cabinet. Shear chaos.?

To Growth, Family, and Philanthropy,

Joshua Krafchick | 369 Financial