Ryder recently opened a massive warehouse in Laredo, Texas, to take advantage of the fruits of post-pandemic nearshoring.
The pandemic exposed uneven and sometimes unreliable supply chains during the pandemic. And the West Coast bottlenecks that ensued as the health emergency waned only confirmed what logistics experts and major retailers suspected: the U.S. needed plants closer to the border.
Mexico has emerged as a significant economic winner and Ryder opened a 228,000-square-foot warehouse and cross-dock facility in Laredo that supports 102 truck docks and room for upwards of 143 trailers. The facility is located approximately 3 miles from the World Trade Bridge. The trucking operation has another hub only six miles away and plans to expand warehouse infrastructure on the other side of the border in nearby Nuevo Laredo, Mexico.
“If you look at the market, truck border crossing activity between the U.S. and Mexico is up more than 20 percent annually since the pandemic, as more businesses look to nearshoring to diversify their supply chains and shorten lead times,” Ricardo Alvarez, vice president of supply chain operations for Ryder Mexico, reportedly stated. “The savings from manufacturing overseas can be offset by inventory sitting on ships or in seaports incurring storage fees; and, of course, by the product being unavailable to meet demand. With Mexico, you put what you need on a truck, and it can be in a final-mile distribution center within days, not months.”
Ryder’s calculations appear to support its massive truck transportation investment along the U.S.-Mexico border. According to the U.S. Census Bureau, imports from Mexico plummeted from $356,093 billion in 2019 to $323,476 billion in 2020. As supply chains were jump-started and companies ramped up the production of goods and materials in Mexico, imports climbed to the following.
- $382,588 billion in 2021
- $454,774 billion in 2022
- $475,606 billion in 2023
While soaring imports appear to be a boon for truckers and logistics operations, the U.S. deficit has also spiked. In 2019, the U.S. trade deficit with Mexico hovered around $99,417 billion. By the end of 2023, it was just above $152,378 billion. Based on its current trajectory, the 2019 U.S. trade deficit will double within two years.
Reports indicate that foreign investment into Mexico may exceed $30 billion this year alone. Companies such as Tesla, Nissan, Honeywell, AT&T, Mattel, and Lego rank among the household name players. For its part, Ryder’s strategy is to speed up cross-border freight transportation, and that means more CDL opportunities for truckers.
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