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US-Mexico intermodal freight shipping gaining in popularity

US-Mexico intermodal freight  shipping gaining in popularity

The use of US-Mexico intermodal freight shipping resources can speed the border crossing of goods.

While the primary mode of shipping between Mexico and the US has been overwhelmingly motor transport or trucking, rail has made great strides in several ways. US-Mexico intermodal freight movement is becoming increasingly popular. Indications are that use of a combination of truck and rail transport for shipments going back and forth across the US-Mexico border will become more prevalent going forward.

By Rail or By Truck?

Each and every truck that crosses the US-Mexico border must be thoroughly inspected and authorized before proceeding forward to its destination. This commonly results in up to three hours of delay on average per cargo laden trailer. Additionally, Mexico has relatively few paved roads in some areas, and limited percentage of the paved roads that make up the country’s major trade corridors are expressways. When transporting goods from rural areas, it is important to note that most Mexican farmers do not use fencing. As a result, collisions with livestock make up 40% of all transportation accidents. In places that are outside of major trade thoroughfares, truck transportation may not always be the best option that is available.

On the other hand, moving goods by rail can be considerably faster and does not involve the same wait times to cross the border at commercial truck ports of entry. There are far fewer collisions, and a greatly modernized rail system in the past decade means rail is can be a safer and faster alternative for certain routes to market.

What is Intermodal?

Intermodal shipping is an integrative approach to shipping that combines the best of transportation technologies and modes to cut time and loss in shipping goods back and forth across the border. Most US-Mexico intermodal freight transportation–including the border crossing – occurs via rail, with trucking utilized primarily on either end of the journey to deliver goods to and from the railroad. Since Mexican rail companies cooperate extensively with the Mexican government, inbond intermodal freight shipping means shipments are extremely secure and processing times can be greatly reduced.

US-Mexico Intermodal Freight Volumes Rising

With the announcement late last year that BNSF Railway is partnering with Ferromex to launch its first all-rail US-Mexico service, it became obvious that use of rail and intermodal will be more pronounced in the future. As demand for US inputs and Mexican manufactured goods increases, railways like BNSF can expect to experience huge increasing demand for their services. In fact, BNSF has doubled their total rail volume in the years since the signing of NAFTA. In 2013, alone, rail imports into Mexico increased nearly 7% and rail exports from the US to Mexico increased at about the same rate.

Another player that has invest heavily in anticipation of an increase in the use of rail and intermodal freight is the Union Pacific Railroad, that recently launched an intermodal line between Chicago and Monterrey, Mexico and has istalled a new $400 million intermodal terminal in Santa Teresa, New Mexico. Handling the most intermodal cross-border volume of any North American railroad, KCS is in a unique position to measure the rise in US-Mexico intermodal freight traffic. The company reported in the second quarter of 2013 a year-over-year increase in cross-border rail traffic of twenty-one percent.

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