NAFTA trucking heats up

NAFTA trucking heats up

NAFTA truck trade expands

The trucking industry hauled $453 billion worth of imports and exports between Canada and Mexico in 2004, according to the DOT’s Bureau of Transportation Statistics.

Cross-border shipments via trucking were consistent with overall NAFTA trade expansion year-over-year, as both increased approximately 12%. Railroad trading was slightly higher at just over 13%.

“NAFTA is probably growing more than general domestic volumes because there’s the integration of the three economies—especially with the U.S. and Mexico,” analyst Chris Brady, president of Commercial Motor Vehicle Consulting, told Fleet Owner.

And integration also has the potential to keep cross-border tonnage relatively robust, compared with domestic. For example, many global businesses are using a single manufacturing plant in Mexico to supply both the U.S. and Mexico, whereas previously there might have been one plant for each country, Brady explained. “Such a situation automatically increases NAFTA trade,” he said.

When asked about bottlenecks related to border security, Brady responded that up to this point it hasn’t had much of an impact on trucking’s share of NAFTA trade.

“In the short term this doesn’t appear to be the case,” Brady said. “But if it drives up logistics costs, a plant that once looked competitive across the border might not be anymore.

“However, I see the use of new technologies to prevent a real bottleneck at the borders,” he continued. “If [shippers and carriers] see their operations getting severely hampered due to bottlenecks at the border, they’d apply enough pressure on the government to reduce these bottlenecks.”

Indeed, trucking remains extremely competitive, accounting for more than 71% of the total value of NAFTA trade, with the much of remainder moved by rail (17%).

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