European automaker Volkswagen announced Tuesday that Port Freeport will be its new Gulf Coast hub for annual imports of 140,000 vehicles for delivery to over 300 dealers across the U.S.
Volkswagen said it has signed a 20-year lease agreement and will construct new logistics facilities at the port located in South Texas, according to a news release. The new facilities are scheduled to be operational in 2024.
Volkswagen port operations in Houston and Midlothian, Texas, will be consolidated into the hub at Port Freeport. Volkswagen currently utilizes eight ports in the U.S. to provide imports for its 1,000 dealerships in the country.
Financial details of the lease and Volkswagen’s investment in new facilities at Port Freeport were not disclosed.
“Moving Volkswagen Group of America’s major Gulf Coast hub to Port Freeport is part of our network and growth strategy for the United States,” Anu Goel, Volkswagen Group of America’s executive vice president, group after sales and services, said in a statement. “Our new hub at Port Freeport will allow us to serve nearly one-third of our U.S. dealer network more efficiently and more sustainably.”
Port Freeport is located about 60 miles south of Houston in southeast Texas, where the Brazos River empties into the Gulf of Mexico.
The port offers container, general cargo, breakbulk and roll-on/roll-off (ro-ro) services. Carriers offering ro-ro services at the port include Hoegh Autoliners, Glovis, Liberty Global Logistics, Sallaum and Grimaldi Lines.
In recent years, Port Freeport has invested more than $400 million in improvements to its terminals, along with expansion of its rail capacity and ship channel.
“Port Freeport’s strategic investments in new berths, rail infrastructure and channel enhancements, combined with the quick transit times to berth, bolster Volkswagen’s goals for an environmentally sustainable and efficient logistics network solution on the Gulf Coast,” John Hoss, chairman of the Port Freeport Commission, said in a statement.
Watch: Blank sailings are on the rise, while ocean spot rates are declining rapidly.
Click for more FreightWaves articles by Noi Mahoney.
More articles by Noi Mahoney