study: U.S.-Mexico truck dispute costing
American jobs, billions in lost exports
The U.S. government’s decision earlier this year to end a cross-border trucking program with Mexico, and subsequent economic retaliation by the Mexican government, has already
resulted in 25,000 lost American jobs, $2.6 billion in foregone
U.S. exports, and $2.2 billion in higher costs for U.S. businesses
and consumers, according to a U.S. Chamber of Commerce
study released Sept. 15.
In March, Congress and the Obama administration ended
funding for a two-year program that allowed 100 Mexican
trucking firms to operate in the United States beyond a 25-mile
commercial zone along the U.S.-Mexico border. In retaliation,
Mexico slapped $2.3 billion in penalty duties on 89 U.S. import
products, with an immediate duty cost to American consumers
of about $421 million, according to the study.
In addition, the study said the decision to end the program
means truckers operating between the United States and
Mexico must continue to rely on costly short-haul drayage to
pull cargo-laden trailers across the border, where they are
picked up by long-haul trucks on the other side for delivery to
their destinations. Drayage services cost $739 million in 2008,
the study concluded, costs that were eventually passed on to
consumers in the form of higher prices for Mexican imports.
The 1994 North American Free Trade Agreement (NAFTA)
required an eventual phase-out of access restrictions on
Mexican trucks operating in the United States. Under the original schedule, the United States was to have opened its roadways to Mexican truckers on Jan. 1, 2000. However, the United
States has blocked implementation of that provision, citing
environmental and safety concerns.
According to the study’s authors, while the so-called “input
costs” of drayage and the Mexican retaliation totaled approximately $1.15 billion, their cumulative impact on U.S. economic
activity is more than $1 billion higher.
The study calculated that 0.02 percent of all American jobs, or
25,557 positions, have been lost as a result of the United States’
actions and Mexico’s retaliation. The calculations were based on
total U.S. full-time equivalent employment of 127.8 million in 2008.
Others see it differently. For instance, the Teamsters Union, which
has opposed the opening of U.S. highways to Mexican truckers,
says responsibility for the job losses lies elsewhere. NAFTA alone
has cost at least 1 million U.S. jobs by giving U.S. businesses incentives to relocate production to lower-cost Mexican locations, said
Teamster spokesperson Leigh Strope in an e-mail. Strope also
blamed the Mexican government for imposing retaliatory tariffs
that were “manifestly excessive” and “a violation of trade rules.”
The Teamsters maintain that Mexican truckers continue to
pose a safety and environmental threat. “If the Mexican government wants our border opened to its trucks and drivers,
then it can live up to its responsibility to make sure those trucks
and drivers meet U.S. highway standards,” said Strope.
—M.S.
alliances
; A sweet strategy. The Swiss Colony, a manufacturer and catalog retailer of sweets, spreads,
and pastries, has upgraded to the Kewill Flagship
parcel and LTL shipping solution. Swiss Colony,
which has been a Kewill customer since 2000, is
upgrading to the enterprise solution in order to
capitalize on opportunities to cut its transportation costs through zone skipping.
; Green grocer. Genco Supply Chain Solutions
has purchased 136 GenDrive hydrogen fuel cell
power units from Plug Power Inc. on behalf of
one of its clients, grocery retailer Wegmans.
Genco will use the units in a three-phase project
to convert the lift trucks used at Wegmans’
Pottsville, Pa., distribution facility from lead-acid
batteries to hydrogen fuel cells.
; Border control. Procter & Gamble has selected
Ryder System Inc., a supply chain and logistics
solutions company, to manage cross-border
transportation operations within the company’s
U.S.-Mexico logistics network.
; In the pipeline. Viastore systems has completed the installation of its viad@tWMS warehouse
management system (WMS) at four facilities
operated by Viega, a manufacturer and distributor of piping, plumbing, and heating products.
The WMS, which can accommodate both automated and manual operations, is now in use in
Viega facilities in Kansas, New Hampshire, and
Nevada as well as a warehouse in
Niederwinkling, Germany.
; Safe and secure. Coscon Logistics, a subsidiary
of Cosco Container Lines Co., has teamed up
with Savi Networks to offer customers real-time
GPS tracking and monitoring of their containers.
In addition to providing real-time visibility of
cargo location, the Savi sensor devices report on
the security status of the shipments as well as
environmental conditions—such as temperature
and humidity levels—inside the containers.
; Making a connection. Rexel, a distributor of
electrical parts, recently implemented Activant’s
Eclipse ERP software throughout its U.S. operations. The software will eventually replace the
various ERP systems currently operating across
the company’s various divisions.
