At 1:27 a.m. EST on March 26, Dali, a container ship built by South Korean shipyard Hyundai Heavy Industries (now renamed HD Hyundai Heavy Industries HD HHI), hit a key pillar of the Francis Scott Key Bridge (Francis Scott Key Bridge) in Baltimore, Maryland, and six people were killed.
Container Ship and engine are both built by HD HHI
Korean media reported on the 29th that HD HHI is “a little bit panicked” by the collision of Dali. In particular, there are concerns about the impact on the listing of HD Hyundai Marine Solutions, a subsidiary of HD Hyundai Group, which has identified the bridge collision as a potential case for litigation and investigation, and is collecting information related to the incident.
Data show that the “Dali” was built by HD Hyundai Heavy Industries (formerly Hyundai Heavy Industries) Ulsan Shipyard in 2015 and delivered to the shipowner, classed by Nippon Kaiji Kyokai (ClassNK). The container ship is 300 meters long and 48 meters wide with a capacity of 9,962 TEU, including 1,400 reefer slots. Notably, it is equipped with B&W 9S90ME-C9 main engines and HIMSEN 9H32/40HD auxiliary engines for power generation, also manufactured by HD HHI.
HD HHI argued that there had been no major problems with Dali in the eight years since it was delivered and commissioned in 2015, and therefore there were no defects with the container ship itself. The warranty period for the ship itself and the engines, which lasted from one to two years after delivery, has now expired.
Power failure may have been a cause of the accident
The container ship alerted the Maryland Transportation Administration shortly before it collided with the bridge that it “may lose control of the vessel and collide with the bridge,” according to the outlet, which reported that one of the reasons for the loss of control of the ship was allegedly an electrical problem.
According to a voyage data recorder recovered by the National Transportation Safety Board (NTSB), Dali suffered a power failure for 63 seconds as it approached the bridge, and the pilot attempted to avoid a collision by dropping the port anchor. The U.S. Coast Guard also confirmed that Dali’s engines had been routinely serviced during the port call, while Baltimore port authorities stated that the vessel had suffered a “severe power outage” in the days prior to the loss of power.
As HD Hyundai Marine Solutions has warranty obligations for Dali and is based on HD Hyundai’s engine technology, the company’s IPO plans may also be affected by this incident. However, some analysts believe that the HIMSEN 9H32/40 engines equipped on Darley have been installed on many container ships over the years, so it is unlikely that there is a design flaw in the engines.
Some members of the shipping industry believe that Dali was over-operated and under-maintained due to reduced utilization during the 2020 refit. There is also a possibility that the Dali’s use of poor-quality, low-sulphur fuel in Latin America has led to equipment damage, since it is difficult to control the quality of the ship’s fuel during voyages in Asia and the Americas, such as through the Panama Canal.
It has been reported that the US media has called the Baltimore Bridge accident the worst bridge collapse in the country after 44 years, which also means that the insurance compensation will be an enormous amount, or will break the record of shipping insurance payouts.
So far, the 2012 Costa Concordia shipwreck and the 2021 accidental grounding of the container ship Ever Given are the biggest casualty claims of the century. The insurance claim for the sinking of the Costa Concordia, which sank twelve years ago in waters off Italy, killing 32 people, amounted to approximately $2 billion.
Marcos Alvarez, managing director of global insurance ratings at credit rating agency Morningstar DBRS, said that depending on the cycle of marine shipping blockages caused by the accident and the nature of the business interruption coverage at the Port of Baltimore, insurers could be required to pay claims in the range of $2 billion to $4 billion. Additionally, removing debris from the collapsed bridge and building a new one would cost another $2 billion.
The accident resulted in the deaths of six workers who fell into the river while carrying out road repairs on the bridge. Currently, the US National Transportation Safety Board has launched an investigation into the incident, and the Maritime and Port Authority of Singapore (MPA), the Singapore flag administrator of Dali, has also begun to intervene in the investigation.