Nearshoring to Mexico was expected to begin in 2020 when the USMCA replaced the North American Free Trade Agreement, but the move didn't ramp up until 2021. In 2022 the US is seeing an explosion of companies interested in moving to Mexico. And one major benefit of these moves for companies is the ability to capitalize on freight movement.
CFI's cross-border operations access five major entry points, running tractors to and from the Mexican border, including its largest facility in Laredo, Texas. Greg Orr, President of CFI, explains, "I think with the labor rates in Mexico being competitive, versus what it is in China, minus the transportation costs that you would have coming across the Atlantic Ocean versus crossing the border, I definitely think Mexico is positioned well to partake in attracting more companies." But he also hopes to see a balancing out of where manufacturing is located.
"I've heard a lot of stories and rumors that there's quite a few companies that are looking to bring stuff back into the United States, and I hope that there's just a good balance or combination of manufacturing on both sides of the border," Orr said. "Because truth be told, as great as it is to have the northbound freight coming [to the U.S.] from Mexico, the hard part is getting the southbound freight to [Mexico] to be able to capture that freight going north. Right now, it's definitely a lopsided ratio. I would hate for it to become even more lopsided."
To learn more about CFI's cross-border and intra-Mexico services, visit our website
here, and to learn more about current predictions on nearshoring, check out FreightWaves article
here.