MISSION, RGV – At the request of the U.S. and Mexico governments, INDEX, the trade association for the maquiladora sector in Mexico, is undertaking a detailed study of the time it takes trucks to cross the border.
Emilio Cadena, president of INDEX, spoke about the study during a speech to members of INDEX Reynosa at the Club of Cimarron in Mission.
“Logistics is so important. We need to be faster and better. We need to be able to predict better how long our shipments are going to take to go from Mexico to the U.S. Our problem is not only time. It is how unpredictable the time is,” Cadena said.
“We did a study, starting in Nogales and we have seen that our shipments to cross from the Mexican side to the U.S. side takes us anywhere from 30 minutes to 600 minutes. It is this uncertainty that kills us. I think as manufacturers we are okay with risk but uncertainty is not something we want to deal with.”
The study came about because INDEX is part of the Consejo Coordinador Empresarial, the business council of Mexico. The CCE and the U.S. Chamber of Commerce are working together on various projects with the blessing of the U.S. and Mexican governments. “One of the key projects we have is optimizing cross-border trade. It is part of the national agenda. We had U.S. Secretary of Commerce Penny Pritzker approving the agenda and the strategic plan. We are taking it to the next level,” Cadena told the meeting.
Cadena gave more details about the cross-border study in an exclusive interview with the Rio Grande Guardian after his speech. He said it makes sense for Mexico and the U.S. to work together on optimizing border crossing times because both countries benefit.
“Manufacturing in Mexico is more linked to the U.S. than it has ever been. I do not believe there is competition between Mexico and the U.S. What I believe is, what are the synergies we have together to make the region as competitive as possible for manufacturing, compared to other regions in the world. If we think as a region from this perspective then we can become much, much more powerful, much more productive, and support growth for the region.”
Specifically about the study, Cadena said:
“The U.S. Chamber of Commerce, along with Mexico’s CCE, Consejo Coordinador Empresarial, has a joint initiative which is part of the high level economic dialog between Mexico and the U.S. They have transferred some initiatives to the private sector. What this dialog does is discuss different issues, proposes solutions for the different problems that we have for both Mexican and U.S. governments. We are part of CCE. They have assigned us to be one of the co-chairs of one of the working groups. This group is charged with studying the optimization of cross-border trade. What initiatives can we propose to both governments for two main areas? One is to expedite logistics, the physical logistics of goods coming in and out of Mexico and the U.S. The second is how we make simpler the paperwork between the two countries. How do we have the same documents, the same reporting, so we can impact the logistics time, which, at the end of the day is the overall goal?”
Cadena said he hopes there are systematic changes to the process of trucks crossing international ports of entry, once the results of the INDEX study is complete.
“Analyzing the process it is clear we have a silo approach to border crossing. Every agency looks only at its area of control. The guy from the bridge cares only that you pay the toll, FTA, Customs, CBP, Mexican customs do their things but nobody looks at the overall process. We have the same information being transmitted to different government agencies. There is no communication among them. And then, the physical infrastructure does not match the technology. It varies from bridge to bridge. You have some bridges that have great infrastructure but the process itself is really lousy. And you have others where the process is a little bit better but the infrastructure does not work. One of the key proposals that we have to do is to analyze the overall process of logistics, 15, 20, 30 miles before you get to the border, because that is where the problem can be solved. And then, when you are 20, 30 miles on the other side of the border. That is what we are analyzing.”
Cadena said the team studying border crossing is currently mapping the process using GPS technology.
“We started with a pilot program in Nogales. We wanted to learn how long it takes at every single step so that we can find the bottlenecks and make the correct proposals. By the end of the year we are going to have the first big sample of data so that we can start drawing some conclusions. The idea is for us to set up a world class metric on how long it takes to cross the border. We say in manufacturing, what you don’t measure, you can’t control. That is the beginning of the problem, we do not have a metric that says this is what we are going to shoot for and then we can work around that.”
Cadena said major corporations like FedEx and UPS which do a lot of cross-border trade are assisting with the study. “We have companies on both sides of the border heavily involved. FedEx, UPS, all the rail companies, all the manufacturing companies, it is nice group. We have received big support from Secretary Pritzker in the U.S. and big support from CBP. I think we are getting traction. To get a bilateral initiative like this up and running and to get traction takes some doing. It is a big wheel that you have to start turning. But I think the wheel is in motion and I think we are going to get some great things done.”
Editor’s Note: This is the second in a two-part series on the remarks INDEX Mexico President Emilio Cadena made at an INDEX Reynosa event at the Club of Cimarron in Mission on Aug. 12, 2015. Click here to read Part One.