ATA’s Card Visits Mexico to Promote Border Trade

This story appears in the Nov. 12 print edition of Transport Topics.

American Trucking Associations officials recently traveled to Mexico City to urge cooperation among freight transportation companies and governments in building commerce among the United States, Mexico and Canada.

ATA Chairman Michael Card said in an Oct. 23 speech to the Mexican Transport Council that the nations have all prospered from trade, and governments and industry should promote more efficient border crossings in order to facilitate further growth.

“Cross-border trade has grown considerably faster than the economy in general, both for the U.S. and Canada and the U.S. and Mexico, and these are goods that are more likely to be shipped by truck,” Card, the president of Combined Transport Inc., said in an interview after his return.

“Between the United States and Mexico, there are lots of challenges and none of them are easily fixed, but Mexican motor carriers want safe drivers and safe roads and are like us on that,” said Card, who started his one-year term as ATA chairman in October.

The Mexican council to which Card spoke is a group of trade associations representing freight transportation carriers across all modes. The event was the council’s international forum and included Mexico’s transportation secretary, said ATA Vice President Martin Rojas, who accompanied Card.

Card traced the history of cross-border trade back to the beginning of the North American Free Trade Agreement in 1994, when the value of surface trade was about $300 billion. U.S. Bureau of Transportation Statistics figures show that trade rose steadily through 2008, when it hit about $800 billion.

Volume fell in 2009 because of the recession, but by 2011, it hit a new high of almost $900 billion for U.S.-Mexican and U.S.- Canadian surface trade, combined.

Compliance with Nafta on trucking provisions has been a sore spot between the United States and Mexico. A pilot program was set up in the 2000s during the Bush administration, but it was canceled and then reconfigured and begun again. The program is now beginning its second of three years.

“I talked to a woman who is a member of the Chamber of Deputies, and her attitude was, ‘How come we’re not getting our act together in the U.S.?’ I told her we do have a pilot program, and we’re trying to make it work,” Card said.

Card said protracted disagreements have led to tariffs on U.S. goods, which end up reducing trade. He recommends full compliance with Nafta’s provisions because “it’s the law of the land.”

Not all problems involve government disputes, though. Card said that one impediment to widespread cross-border trucking is diesel fuel.

Since late 2006, the United States has required the use of ultra-low-sulfur diesel with a sulfur limit of 15 parts per million. In contrast, Mexico currently requires what the United States used until the changeover, low-sulfur diesel with sulfur of up to 500 ppm.

While a lot of the work to be done between the two countries would be the harmonization of standards, Card said he probably would most like to see the U.S.-Mexican border become as efficient as the U.S.-Canadian border.

“Sometimes, it can take up to 48 hours for a truck to cross the Mexican border. There are some pretty long delays there. Sure, there are delays at times with Canada, but it’s nothing like that,” Card said, adding that he would like ATA representatives to meet with Mexican carrier executives at a crossing such as Laredo/Nuevo Laredo.

The United States has a built-in advantage for trade with Mexico, Card said, because the adjacent nations have a long land border crossed by numerous highways. However, he warned that the advantage is not unassailable.

“If American companies try to ship to Canada or Mexico and we can’t get through the border, but companies from Europe or Asia can get there via ships, then we can’t compete, especially if there’s transloading at the border adding costs and time. You can’t just assume we will automatically be cheaper because we share a border,” Card said.