Borderlands is a weekly summary of developments in the world of trucking and cross-border trade between the United States and Mexico. This week: Are the United States and Mexico Winning Globalization? Fleetmaster Express has received its first two Volvo VNR electric trucks; a Texas seaport announces new ro-ro service from Asia; and a Houston multimodal park signs two tenants.
Are the United States and Mexico winning globalization?
The era of globalization may slow down as businesses continue to grapple with supply chain challenges and relocation continues to be a discussed trend across all kinds of industries.
Bringing production closer to end users in the United States – relocation and proximity initiatives – could make supply chains more resilient by eliminating long shipping routes while bringing more manufacturing jobs back to North America, said Tasneem Manjra , CEO and co-founder of Caravan.
“Reshoring is huge, and I hear that trend a lot when we talk to potential customers,” Manjra told FreightWaves. “[Companies] want to make decisions about relocation for a number of reasons – for political reasons, to ensure that the countries they work with are politically sound. They also don’t want to have the labor crisis China is having, for example, or they want to make sure they’re closer to home for environmental purposes, creating a smaller footprint.
Caravan, based in San Francisco, is a supplier relations platform that aims to streamline and optimize the way manufacturers and retailers interact with their suppliers.
Nearshoring often explains when a company transfers its work to another organization located in a nearby region or country. Relocation is the process of returning the manufacture of domestic products from a foreign country to the country of origin where the commercial products are sold.
A recent example of nearshoring is California-based toymaker Mattel, which announced in March that it was consolidating all North American manufacturing at its plant in Monterrey, Mexico.
Mattel said it was also investing $47 million to expand the Monterrey plant, where it employs nearly 3,500 workers, becoming the company’s largest manufacturing site. Mattel closed two of its factories in Asia in 2019, as well as factories in Montreal, Canada, and another in Tijuana, Mexico, in 2021, before expanding its Monterrey factory.
“We believe that Mexico, given its geographical position, has a unique opportunity to position itself as a toy hub in the world. To contribute to the development of this industry in Mexico, we have supported local suppliers and motivated international suppliers to set up in [Mexico]said Ynon Kreiz, CEO of Mattel, according to El Financiero.
The January announcement by California-based semiconductor maker Intel Corp. of a $20 billion investment to build two chip factories near Columbus, Ohio was a major recent win for US manufacturing.
Construction of the factories is expected to begin later this year, with production commissioning in late 2025. The two Ohio factories are expected to create 3,000 direct jobs.
Intel, which employs 116,000 people worldwide, has more than a dozen research and manufacturing facilities around the world, including the United States, France, Germany, Italy, Ireland, Poland, in Israel, India, Malaysia and Vietnam.
While North America has had recent successes in terms of manufacturing returning, US imports of manufactured goods from Asian low-cost countries (LCCs) have actually increased in 2021, according to the ninth annual Kearney Relocation Index.
The Kearney Relocation Index tracks trends in manufacturing returning to the United States from 14 LCCs and regions where sourcing, production and assembly have been relocated.
Manufacturing from LCCs totaled 14.49% of U.S. gross manufacturing output, up from 12.95% in 2020, according to Chicago-based global management consulting firm Kearney.
However, Kearney officials said that “there are strong indications that attitudes and strategies are changing, thanks to the pandemic, trade wars and tariffs, and the ongoing supply chain disruptions that result from it. result.
“American companies are increasingly seriously considering adopting expanded versions of offshoring. Much offshore manufacturing could soon return thanks to companies combining their nearby production in Mexico, Central America and even Canada, with manufacturing and assembly in the United States,” Kearney said.
Manjra said he’s heard from many customers that the tide may be turning, with companies looking to create a supply chain closer to home – rather than a lower-cost supply chain.
“I just think about it over the last 20 or 30 years, companies have almost been rewarded for basically sending American jobs overseas,” Manjra said. “It has been very detrimental to the national economy because we have fewer skilled workers today than we have ever had in the country.
“I’m really encouraged when I see manufacturers say, ‘No, we want more jobs here, we want to keep the jobs here, we want to bring our operations back to…America or Canada.’ I think that’s super encouraging.
Fleetmaster Express receives first Volvo VNR electric trucks in Texas
Fleetmaster Express recently received two Volvo VNR Electric Class 8 trucks in Texas as part of the company’s plan to transition from a diesel to an electric fleet.
The Roanoke, Va.-based carrier said the two electric trucks will be based at the company’s terminal in Fort Worth. Eight additional Volvo VNR electric trucks are expected to be delivered in early 2023.
The two Volvo VNR Electrics are the first battery-electric Class 8 trucks in its fleet, and “the rollout of zero tailpipe emissions Volvo VNR Electrics is the next big step in our efforts to create the most sustainable and as energy efficient as possible,” Travis Smith, COO of Fleetmaster Express, said in a statement.
Fleetmaster operates over 300 trucks with 1,000 trailers from 13 terminals across the country. The company offers dedicated transportation services, as well as freight brokerage, warehousing and tracking services.
Volvo Trucks North America is based in Greensboro, North Carolina.
Seaport of Texas announces new ro-ro service from Asia
Ocean shipper Nippon Yusen Kabushiki Kaisha (NYK Line) made its first port call in Port Freeport, Texas on May 16 to begin scheduled service.
Based in Tokyo, NYK Line is a roll-on/roll-off (ro-ro) service provider, including vehicle dispatch and logistics, distribution management of cars, trucks, rolling stock and bulk freight.
“Port Freeport’s proximity and efficiency to regional and global markets, combined with the opportunity for expansion, make the port a strategic hub for vehicle imports and exports,” said Phyllis Saathoff, executive director and CEO of Port Freeport, in a statement.
Opal Leader of NYK Lines unloaded OEM vehicle units and heavy cargo at Port Freeport. The service will also call at ports in Mexico, Panama, Colombia and Brazil and will call at Port Freeport monthly.
Port Freeport is located approximately 60 miles southeast of Houston along the Gulf of Mexico.
Houston Multimodal Park signs 2 tenants
The Greens Port Industrial Park, along the Houston Ship Channel, has two new tenants: JD Fields & Co. and ZL Chemicals.
Houston-based JD Fields & Co. is a global supplier of steel products. ZL Chemicals is a Houston-based manufacturer of chemicals used in the oil and gas industry.
The 735-acre multimodal industrial park is owned by Watco, a transportation services and supply chain company with operations in North America and Australia.
Steve Pastor, NAI’s vice president of global supply chain and port/rail logistics, said operators are looking for locations that help drive efficiency. Pastor was part of the team that represented Watco in the transaction.
“Over the past 18 months, logistical tasks as simple as unloading cargo from ship to shore have become increasingly time-consuming and costly at many ports,” Pastor said in a statement. “For this reason, Greens Port Industrial Park stands out as it provides direct access to [Port Houston]one of the most important ports in the country.
Watch: FreightWaves’ carrier updated for May 27.
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