Delays at U.S.-Mexico border crossing hits autos, trucks still lining up

border slowdown

CIUDAD JUAREZ/MEXICO CITY -- Long delays at the U.S.-Mexico border crossing for goods destined for American plants and consumers are hitting the U.S. auto industry, and the gridlock reduced by half the number of northbound trucks that crossed the entry point last week

Washington's decision to move some 750 agents from commercial to immigration duties to handle a surge in families seeking asylum in the United States has triggered the delays at crucial ports on a border that handles $1.7 billion in daily trade.

"The situation in Ciudad Juarez is very serious because these auto parts go to plants in the United States and obviously they put at risk the operation in the United States," Eduardo Solis, the president of the Mexican Auto Industry Association (AMIA), said on Monday.

The North American auto industry is highly integrated and many car parts cross the border several times before they are finally installed on a vehicle.

Seventeen 17 hours before the crossing to El Paso even opened on Monday morning, trucks were already lining up in Ciudad Juarez to avoid the fate of some 7,500 trailers that failed to cross last week, said Manuel Sotelo, vice president at the Mexican National Chamber of Freight Transport's north division.

That is roughly half the number of trucks per week that usually cross there, carrying everything from car and plane parts to refrigerators, washing machines, TVs, cellphones and computers.

"This is not normal. We had never seen this before in Ciudad Juarez," said Sotelo.

Despite elevated costs, some Mexican exporters are turning to air freight to avoid the mile-long lines at the border.

"We're using charter (planes) which cost between $35,000 and $100,000 depending on the volume and merchandise," said Pedro Chavira, who heads the manufacturing industry chamber INDEX in Ciudad Juarez.

Air freight is typically a last resort used by automakers and suppliers to get parts to an assembly plant for just-in-time delivery.

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Ventus Global Logistics operates out of every port in Mexico and we can reroute your goods through other ports even with a border slowdown or shutdown. In addition to land freight, our air and ocean freight services cover both consolidated shipments (LCL) and containers (FCL). Call us today for a FREE quote or fill out our online form.

Border wait times swell amid customs officer shuffle to handle migrant crisis

border slowdown

NUEVO LAREDO, Mexico - U.S. President Donald Trump hasn't followed through on his threat to shut the border with Mexico, but one crossing here that connects this Mexican city with Laredo, Texas provided a glimpse of the chaos and economic disruptions that it would likely ensue.

Lines of 18-wheeled semi-trucks carrying auto parts, produce and other goods for U.S. consumers and businesses stretched more than six miles into Mexico Wednesday after the Trump administration shifted Customs and Border Protection agents from Laredo and other Texas border crossings to El Paso and the Rio Grande Valley to deal with the flood of asylum seekers from Central America. Waits to cross the World Trade Bridge, which normally run 30 minutes, reached more than three hours.

The impact of the delays was being felt on both sides of the Rio Grande, with those who depend on U.S.-Mexico trade barely able to consider what would happen if the Trump closed the border. Ernesto Gaytan, president of the Laredo company Super Transport International, which has 200 trucks on the American side of the border and 300 more on the Mexican side, said he couldn't put a number on it, but knew the delays were costing him money. A complete border shutdown, he estimated, would cost his company $200,000 a day.

On the other side of the border, Roberto Hernandez was idling at the back of the line with hundreds of 18-wheelers ahead of him. Hernandez doesn't get paid by the hour, but rather by the number of loads he delivers.

Usually, he makes four cross-border runs a day, earning the equivalent of about $15 per load. But he was only able to make two trips on Tuesday and his is daily pay fell to $30 from $60.

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Ventus Global Logistics operates out of every port in Mexico and we can reroute your goods through other ports even with a border slowdown or shutdown. In addition to land freight, our air and ocean freight services cover both consolidated shipments (LCL) and containers (FCL). Call us today for a FREE quote or fill out our online form.

The retail apocalypse, omnichannel and supply chain analytics

supply chain analytics

Three of the most important themes in retail right now are the retail apocalypse, omnichannel and supply chain data analytics. In our view, this is not a coincidence: the industry is abuzz with talk about the tools that will bring retail into the future and improve customer experiences; meanwhile, we're bearing witness to the destruction of numerous brands that have failed to adapt. In this piece, we explore how these three themes are interwoven in an attempt to articulate exactly what the challenges and opportunities are in contemporary retail.

What is the retail apocalypse? CB Insights, the leading intelligence platform and media company on high-growth private companies, has studied the phenomenon better than any other company. The 'retail apocalypse' is a catch-all term for the nearly 80 major retail bankruptcies since 2015. This year has already seen bankruptcies of nine major brands – Beauty Brands, Charlotte Russe, Diesel, FullBeauty Brands, Gymboree, IMS (Innovative Mattress Solutions), Payless Shoesource, Shopko and Things Remembered.

More illuminating than the number and names of the restructuring companies, though, is the insight into the reasons why the companies failed. David's Bridal cited its struggle to keep up with online competitors when it filed Chapter 11 in November 2018; the month prior Sears pointed to the challenge of personalizing the customer experience and improving operational efficiency; in August 2018 Brookstone hired liquidators to close 100 stores due to declining mall foot traffic.

"Retailers who survive the e-commerce disruption by executing on omnichannel will do so by executing a fulfillment strategy that is as nimble as possible," said Chris Kirchner, CEO of Slync. "Survivors will have to find solutions that provide real-time supply chain data in order to balance competitive threats and ever-shifting consumer demands."

In general, companies that recently expanded their brick-and-mortar footprints were the worst off. Doubling-down on physical retail stores indicated a lack of commitment to e-commerce and blindness to the fact that physical locations were less and less productive. Plus, the debt used to finance growth in real estate holdings quickly became burdensome.

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Making the Autonomous Supply Chain a Reality

Supply chain

Supply chains are evolving in the face of greater customer demand, soaring expectations, and endless purchasing opportunities. Retailers, manufacturers and third-party logistics companies are having to move quicker and produce more with shorter turnarounds and greater transparency. Companies are digitizing their supply chains to meet these new challenges, but this alone isn’t enough to answer the questions businesses are asking every day: what’s going to happen tomorrow, next week, next month and next quarter?

An autonomous supply chain can help businesses respond with immediacy and decisiveness. This technology is designed to deliver on-demand, navigate disruptions months in advance and help keep your business ahead of any changes in customer buying behavior. The three core tenants for an autonomous supply chain are:

Reading the signals

The more information a business has access to and uses, the more it can help understand any changes in supply and demand. In the past, the main challenge was having the processing capability necessary to collect reliable data and harness it to represent the realities of changing conditions. The capacity to measure and recognize external conditions is critical to predicting supply and demand. The autonomous supply chain requires a significant increase in external signals, which relies on the reporting of evolving climate and market conditions in real time.

So how can you read the signals? Using artificial intelligence (AI), machine learning (ML) and IoT, you can manage and interpret signals such as weather events, temperatures jeopardizing fresh products and any online social trends influencing customer demand. Businesses need to make use of as many signals as possible, because if dimensions are missing it will difficult to get a clear picture.

It sees everything

To truly understand their entire supply chain, businesses need to manage the complexity and volume of intelligence — billions of pieces of information that are time-stamped with their own varying amounts of information. Let’s set the stage: imagine sensors inside a lorry, which is on its way to deliver fresh goods to a grocery retailer. Sensors are able to detect the temperature inside and outside of the lorry, the speed it is travelling at, and if there are any road works which will slow the delivery down. Every detail is pinpointed with time and date stamps.

Read the entire article here.

Doing Business in Mexico

NAFTA

NAFTA boosted the centuries-old business relationship between Mexico and the United States by allowing both countries to benefit from a seamless workshop that undoubtedly made the pie larger. As with any 25-year-old contract, however, NAFTA needed to be revised. Negotiations required delicate balancing between technical and political issues, with motor vehicles and auto parts requiring the lion´s share of the modifications.

In this article, we take stock of the revised agreement and, at the same time, look ahead at what the 2019 business calendar may bring in Mexico through the following top four issues:

  1. The (possible) execution of the US-Mexico-Canada Trade Agreement (USMCA), and what it means, particularly, for motor vehicles and auto parts manufacturing and sales in North America
  2. The newly elected (2018-2024) Lopez-Obrador administration
  3. New Product Safety Requirements and Recall Procedures
  4. The New Mexican Anti-corruption Law

Read the entire article here.
Originally publish in The National Law Review.

Ventus Global Logistics has 30 years of experience providing freight and distribution services for international companies that do business in Mexico. Contact us today to find out how Ventus Global Logistics can facilitate seamless import and export of your goods across North America.

Mexico Trade Spurs Largest Regional Spec Build

Laredo, TX

Laredo, TX is the third largest port in the U.S. after Los Angeles, and New York City and 60% of U.S. / Mexico trade occurs in Laredo, TX. Last year trade in Laredo surpassed $300 billion. This robust trade has driven the need for the largest regional class-A industrial spec space to be developed. It is no wonder why international companies are looking to Laredo to establish logistics operations.

Read the full article here.

Published in GlobeSt.com