Borderlands is a weekly rundown of developments in the world of United States-Mexico cross-border trucking and trade. This week: Nearshoring draws more U.S. logistics investment to Mexico; Volkswagen issues temporary work stoppage at plant in Mexico; commercial auto supplier TitanX expands Mexican factory; and a truck driver in Texas dies in a collision with a freight train.
Nearshoring draws more US logistics investment to Mexico
Two U.S. companies are making moves south of the border as a nearshoring boom to Mexico continues.
Redwood Logistics recently announced an expansion of operations into new offices in the Mexican city of Monterrey. Redwood Mexico has been operating in the country for about five years, but the expansion of its Monterrey operations reflects the investment manufacturers are making in nearshoring efforts, company officials said.
Redwood Mexico currently has over 100 employees in the country, mainly in the company’s 6,000-square-foot offices in Monterrey.
“The size of our team based in Mexico will grow over 50% year over year during 2023,” Jordan Dewart, president of Redwood Mexico, told FreightWaves. “Going forward we expect double-digit-percentile growth as the revived nearshoring movement continues to gain momentum.”
Redwood Mexico is part of Chicago-based 3PL Redwood Logistics.
Meanwhile, Tampa, Florida-based 3PL BlueGrace Logistics recently announced it is expanding into Mexico by the end of the year.
Scott Schara, chief commercial officer of BlueGrace Logistics, said he’s been doing business in Mexico for more than a decade and has seen Mexico become a “viable option” for more and more shippers.
“I think the pandemic and the 2021 supply chain issues coming out of Asia really got people looking at nearshoring as a viable option,” Schara told FreightWaves. “You’ve got the port congestion and everything over on the West Coast, then you’ve got the unknown of the cost of the containers coming across the ocean. So Mexico has become much more viable.”
BlueGrace has not finalized a location for the new office in Mexico but is considering options such as Monterrey and Mexico City, he said. The company recently hired Jose Fernandez Chavira as vice president and manager of the company’s Mexican operations.
BlueGrace specifically wants to take advantage of expected growth in electronics, appliances and automotive manufacturing in Mexico as more semiconductors are made nearby.
Schara said that the plan to open a location in Mexico was also prompted by customer demand.
“We’ve had a number of our customers ask us when we’re going to get involved with Mexico,” Schara said. “We took the opportunity to listen to our customers and roll out a strategy and hire Jose, somebody that’s done this before, and he’s done it before in a very successful manner.”
Dewart said some of the big drivers of freight are currently sectors such as automotive, home appliances, aerospace, pharmaceutical, HVAC, and food and beverage.
“As shippers of all kinds make the move south of the border, it’s vital that we grow to match their efforts,” Dewart said. “With our expansion in Monterrey, we’re now able to service more cross-border freight.”
Volkswagen issues temporary work stoppage at Mexico plant
Volkswagen will halt operations of its popular Tiguan SUV for at least three weeks at its plant in Puebla, Mexico, officials said on Thursday.
Work is also being suspended for the Taos SUV line at the plant until at least May 8.
The work stoppage is due to a lack of components, according to a statement issued by the Union of Workers of the Volkswagen Automotive Industry (SITAIVW).
This will be one of the longest stoppages in the company’s factory in 2023 and could be extended if components do not become available, SITAIVW said.
The earliest the Tiguan could go back in production is May 21. Volkswagen also manufactures its Jetta sedan line at the plant in Puebla. It will remain in production.
Volkswagen has about 7,000 workers at the Puebla factory, which is in central Mexico. It’s unclear how many workers will be furloughed during the stoppage.
During the first quarter of 2023, the Puebla plant produced 37,764 vehicles, with the United States representing about 56% of its export market.
Commercial auto supplier TitanX expands Mexican factory
TitanX recently expanded its cooling systems manufacturing plant in Ramos Arizpe, Mexico.
The expansion will add 250 jobs, creating a total workforce of 630 people in the factory. Ramos Arizpe is in northern Mexico, about 180 miles from the port of entry in Laredo, Texas.
India-based TitanX is a global supplier of medium- and heavy-duty diesel engine cooling solutions. The company serves global commercial vehicle OEMs, with Freightliner as its main customer in Mexico.
TitanX employs more than 1,000 employees at eight factories around the world.
Truck driver in Texas dies after collision with freight train
A truck driver is dead following a collision involving a flatbed tractor-trailer and a freight train near Corpus Christi, Texas, according to the Refugio County Sheriff’s Office.
The accident happened Wednesday on U.S. Highway 77 in Refugio County. Police said the driver was ejected from the cab during the crash and was not wearing a seatbelt.
The driver of the truck has been identified as 55-year-old Javier Laso of Alice, Texas. Laso was pronounced dead on the scene, according to officials.
The cause of the accident is still under investigation, but Refugio County Sheriff’s Office Patrol Deputy Ty Schultz said it’s important for motorists to remember safety when approaching railroad crossings.
“Don’t ever think you can race a train,” Schultz told 3NEWS. “I would always suggest, anytime approaching railroad crossings, whether they have the guards or the arms or not, always approach with caution. Stop, roll down your windows, listen for a train before you cross. Take the extra steps.”
Click for more FreightWaves articles by Noi Mahoney.
More articles by Noi Mahoney
‘State of Freight’ for April: Overcapacity, weak spot rates
Borderlands: Production, exports of Mexican-built trucks soar in March
US vaccine rules remain as Biden ends COVID national emergency
