BY CLIFFORD F. LYNCH
fastlane
Better late than never
ON JULY 6, THE UNITED STATES AND MEXICO SIGNED AN
agreement that will finally open the doors for Mexican trucks to
begin hauling cargo into the United States. In return, Mexico will lift
over $2 billion in tariffs it had slapped on certain import products in
retaliation for the United States’ failure to honor commitments made
under the North American Free Trade Agreement (NAFTA).
Signed into law in 1993, NAFTA was supposed to eliminate barri-
ers to trade among the United States, Canada, and Mexico. As part of
the deal, the United States agreed to give both Canadian and Mexican
truckers full and free access to U.S. highways by Jan. 1, 2000. While
The first signs of trouble appeared back in 1995,
when the Clinton administration put the trucking
provisions of NAFTA on hold—but only for the
Mexican truckers—citing concerns about their
ability to meet U.S. safety standards. With the issue
still unresolved three years later, Mexico took the
matter to a NAFTA dispute settlement panel,
which ruled in 2001 that the United States was in
violation of the agreement. But that wasn’t enough
to clear the way for the program. Various legislative and legal chal-
lenges kept the initiative tied up in court until 2004, when the U.S.
Supreme Court resolved the matter (we thought), ruling that
Mexican truckers should be allowed into the United States.
It took three years, but in February 2007, the Department of
Transportation (DOT) announced a one-year pilot program that
would allow selected Mexican carriers to make deliveries beyond the
border commercial zones. To participate, truckers had to pass a safety audit by U.S. inspectors, including a review of driver records, insurance policies, drug and alcohol testing programs, and vehicle inspection records.
The plan immediately came under fire from some legislators, the
Owner-Operator Independent Drivers Association, and the
Teamsters. As opposition mounted, Congress in 2009 cut off the
funding for the pilot, and Mexico finally pushed back by levying $2.4
billion in tariffs, as high as 45 percent on some commodities.
The new agreement will bring some relief for importers. Under the
new accord, Mexico agreed to a phased-in elimination of the tariffs.
The United States, in turn, will reinstate the pilot
program. The pact requires Mexican trucks to
obtain authority from the Federal Motor Carrier
Safety Administration (FMCSA) and demonstrate
they meet the same safety standards as U.S. fleets.
Although the agreement was hailed by organizations such as the U.S. Chamber of Commerce,
monitor the movements of Mexican trucks.
Although the plan will never be universally
popular, it’s time to move forward. The benefits
of NAFTA cannot be denied. In 2010, imports
and exports between the United States and
Canada totaled $528 billion, and U.S.-Mexico
trade totaled $393 billion. Well over $2 billion in
trade moves among the three countries every day.
The DOT has taken the steps necessary to ensure
that Mexican truckers who wish to cross the border meet U.S. safety requirements. Let’s keep our
commitment and move on. ;
Clifford F. Lynch is principal of C.F. Lynch & Associates, a
provider of logistics management advisory services, and author of
Logistics Outsourcing – A Management Guide and co-author of The Role of
Transportation in the Supply Chain. He can be reached at
cliff@cflynch.com.
