22 >> 21 Am eri c an N


Issue 5 2021 - FBJNA o rth


automotive supply chain that is competitive with Asian counterparts. Canadian


agricultural


commodities like corn, beans, wheat, and canola will find new export routes into Mexico and to Gulf of Mexico ports. Rob Reilly, CN’s executive vice president and chief operating officer, pointed out to investors and journalists in a recent online presentation that that


CN’s customers would gain access


///US-MEXICO-CANADA


CP and Maersk are building a transloading facility in Vancouver to reduce multi-modal handoffs and to promote inland routing flexibility, better velocity, and cost savings. (CP photo)


to 11 new bulk and intermodal international ports, and KCS customers would gain access to


five new international


intermodal ports. When it comes to auto


manufacturing, some believe that USMCA may have a negative


effect, thanks to


more stringent rules of origin and new labor-rate standards. But developing a


North American rail network would create efficiencies and provide additional options for automotive industry shippers. The addition of KCS’s network to CN’s will allow automotive shipments to bypass Chicago on their way from Mexico to western Canada. New single-


line routes made possible by the merger could spawn new intermodal offerings from Dallas to Chicago, Detroit, and Montreal and from Mexico City to St. Louis and Toronto. “A combined CN-KCS


network will create faster, safer, and more economical rail options for shippers who currently rely on trucks,” said Reilly.


Experts estimate that rail


transport efficiencies could slash up to $200 in costs per vehicle. KCS has access to 16 auto


plants in Mexico, noted Michael Naatz, the carrier’s executive vice president and chief marketing officer. The recently-released World Bank Container Port Performance Index reports that KCS serves 2,600 miles along Mexico’s Gulf Coast to Veracruz, a large auto shipping port, and the Pacific Coast’s Lazaro Cardenas, the Americas’ top- performing port. KCS also has a terminal in Laredo, Texas, where 44% of U.S.-Mexico


trade clears the border. “This network,” Naatz said,


“covers some of the fastest and most-exciting industrial growth markets in North America.” The interest of both


Canadian rail carriers in a merger with KCS represents a big bet on USMCA, which “makes the efficient integration of the continent’s supply chains more important than ever before,” said Keith Creel, CP’s president and chief executive officer. The KCS- CN merger would facilitate that integration, according to CN’s Reilly, with “greater access to more ports, new markets, and greater choice for importers and exporters needing to connect to different geographies.” A container offloaded


in Prince Rupert, British Columbia, for example, could travel seamlessly to many points in Canada and the U.S. heartland. “Kansas City, St. Louis, and M em p his ,”


23 >> Bullet-proof niche


The Canadian National-Kansas City Southern merger may produce additional intermodal offerings that take trucks off roads, but one trucker has developed a bullet-proof niche not likely to be affected by the rail combination. Mexpress Transportation,


headquartered in Santa Clarita, California, provides in-bond truckload and LTL services to airport locations in Mexico, bypassing normal border clearance processes. Clearing Mexican customs at the airports avoids the usual costs and delays. “The border crossing in


Laredo is a black hole,” said Carlos Duron, president of Mexpress. “We provide a way to avoid that mess,” and cutting two to three days off transit times to boot. Mexpress’ expedited


trucking service lends itself to some interesting applications. U.S. air carriers may need to deliver cargo from Asia to Mexico City, for example, but opt to land the cargo in Dallas. Mexpress provides second- day service to Mexico City, and the cargo clears customs on time at the airport. Shipments from Brazil to


Mexico City and Guadalajara, many including auto parts, oſten land in Miami, because of a lack of capacity to Mexico, and are then trucked to their destinations by Mexpress. Liſt capacity issues were exacerbated during the pandemic, Duron noted, as many airliners were grounded. Mexpress’s secret


sauce is the special permits it holds from the Mexican government to carry cargo in bond and clear customs at the airports. “We’ve had those since we were founded in 1998,” said Duron. The process works


in the opposite direction and for ocean freight, too. Extreme congestion at southern California ports has led some Asian shippers to direct cargo destined for the U.S. heartland to Manzanillo. Mexpress’ service gets those shipments, oſten industrial goods, across the border to plants in Tennessee.


“Shippers are trying


to shorten ocean transit times and avoid airfreight fees,” said Duron. “We use the Mexican land bridge to meet production schedules in the U.S.” -- Peter Buxbaum


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24