Officials in Laredo, the major Mexican-U.S. border crossing in Texas, doubt that the recent Supreme Court ruling that opens all U.S. roads to Mexican trucks will have a major impact on logistics in the Texas corridor. Mexican long-haul carriers seeking to cross the border directly are expected to face a customs nightmare, a factor that would negate any efficiencies gained, officials say.
State, Federal & International Affairs Director Rene Gonzales in Laredo, TX, told Fleet Owner that in the short run, the current practice of short-haulers crossing the borders is here to stay at the Texas border.
“If you are a long-hauler, waiting in customs for two to three hours and facing immigration restrictions doesn’t make your operation cost-effective,” Gonzales said. “The reality is that there’s still going to be a border and time is money.”
Mexican carriers that consider long-haul routes across the border will be much more likely to be held up by inspections for several hours, as well as be delayed because of lack of familiarity with the regulations or the roads than their more-experienced short-haul counterparts, Gonzales said. “They know the system and how to get to the bays and the roads.”
Although short-haul truckers are subject to the same inspections as other carriers, long-haul truckers will present new faces to border auditors and would be more apt to arouse suspicion, Gonzales said.
“That short hauler has the time factor working to his advantage— the short hauler knows the system and the customs agents know the truck driver because they see them every day,” Gonzales said. “When they come across someone they’ve never seen before, it sends out red flags.”
Much of the economy of Laredo, the self-proclaimed “gateway to Mexico,” relies on truckers as the city claims significant tax revenues from fuel and hotels from the segment. However, in that city truck volumes have stagnated in recent years compared with the rising activity of railways. Gonzales does not anticipate the NAFTA fulfillment will spark any change in trucking activity within the city.
“Margins are low for trucking companies, and because of this, the trucking industry has to be careful of what it does,” Gonzales said.
In Texas, Gonzales does not anticipate the Mexican truckers will have a severe impact on American jobs either— a concern that the International Brotherhood of Teamsters has lobbied for. Mexican carriers are likely to charge rates that are similar to American carriers simply because they could enjoy the higher rates, he said. “If I’m a Mexican citizen and I could work [drive] for the U.S., my worth just increased two-fold. They are going to go with the market rate.”
The American Trucking Associations (ATA) told Fleet Owner in an earlier interview that that there wouldn’t be any stiff competition between Mexican and American carriers because they are only permitted to handle international— not domestic freight. Additionally, ATA cites over 500,000 trucking companies in the United States compared to 7,800 in Mexico.