• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Trump Tariff Threat: This Mexico Border Town Is Still Feeling the Pain

Trump Tariff Threat: This Mexico Border Town Is Still Feeling the Pain

Trump Tariff Threat: This Mexico Border Town Is Still Feeling the Pain
Source: Bloomberg
June 13, 2019
Bloomberg

The turmoil in Laredo started soon after President Donald Trump’s threat to put tariffs on Mexican goods. It hasn’t let up since — even after he backed down.

“It’s a logistics nightmare,” said Jose Gonzalez, a customs broker in the Texas border town that just this year became the largest U.S. port of entry. He’s hired by companies to ensure goods cross the border in top shape, and would pay any tariffs up front.

Last week, Gonzalez fielded dozens of calls from factories and organized to double some orders before the levies took effect. After Trump lifted his threat Friday night, companies frantically messaged again to resume their regular delivery pace. This week, he was still dealing with a crunch of resources and space, finding that for every truck in Laredo, there were about two loads that need to be moved to their final destinations.

For this city of about 260,000 people, Trump’s eruptions on Mexico over the past two weeks set in motion changes that can’t be easily undone. The town is defined by trade between the two countries, with its industrial parks housing hundreds of freight and truck-rental companies, warehouses, gas stations and operators that lubricate daily commerce. While the immediate tensions have eased, workers still face uncertainty about what comes next from a president who can change policy with a single tweet.

“It’s like a wrestling match: You have someone’s foot to your throat and you can breathe, but only just enough,” Gonzalez said. “The border is the lifeline of our industry.”

Jammed Bridges

The effects of Trump’s threat are already being felt, tariffs or no. At the World Trade and Colombia Solidarity bridges, which carry about a total of 12,000 trucks across the border each day, wait time early this week was still higher than usual because of the increased orders to beat the tariffs.

Ernesto Gaytan, general manager and co-owner of trucker Super Transport International Ltd., said his company was running at full capacity last week. His entire fleet of about 500 vehicles was on the road moving goods across the border. One client quadrupled orders to save $18m in potential tariff costs.

Storage spaces that filled up quickly last week to accommodate the influx are still packed, because there aren’t enough drivers, which meant Gaytan had to turn some clients away.

“We’re still beyond full capacity," Gaytan said Monday. “Everything gets impacted by the tariffs if they ever go in. Everything goes through Laredo. Everybody’s going to feel the effects of it.”

Texas Troubles

Texas, which accounts for more than a third of U.S. trade with Mexico, would be hardest hit by any tariffs on the country. About 117,000 Texas workers would lose their jobs if the full tariff went into effect, according to the Perryman Group. The state is second only to California in labor-market reliance on Mexican trade, data from the Wilson Center show. And 5.9 percent of the gross domestic product is based on Mexican imports, second only to auto giant Michigan.

More than a third of U.S. imports from Mexico actually originated in America, with some items crossing the border multiple times. It underscores just how interconnected and complex the trading relationship is between the countries, and makes it hard to quantify just how much Americans would be hit by the levies.

“When we’re taxing things at the border, we’re actually taxing U.S. goods,” said Katheryn Russ, an associate economics professor at the University of California-Davis. “Consumers may not notice, but it will filter down.”

Fruits and vegetables are among the top traded commodities and the most time-sensitive. Rodolfo Delgado, who owns a 35,000-square-foot refrigerated warehouse in Laredo’s north end, said his clients were worried delays at the border could hurt their produce.

“Importing fruits and vegetables, it’s like importing a trailer of dynamite with a wick on it,” Delgado said. “You cannot hold it, you just have to send it to the final destination to be sold."

Some of his clients were resigned last week to absorbing the 5-percent tariff hit, while others were opting to freeze their goods or looking at selling to Canada instead of the U.S., he said.

“There are many other countries in the world that will buy and sell to Mexico," Delgado said Monday. “What we’ve got is the threat from Trump that’s still looming on us, and people are really getting tired of it."

With a final U.S.-Mexico trade deal still to be worked out, there’s more unease hanging over the region.

“It’s just one thing after another here," said Miguel Conchas, president of the Laredo Chamber of Commerce. “It’s the uncertainty that really plays havoc with business people here in town and in Mexico."

RELATED CONTENT

RELATED VIDEOS

Logistics Global Gateways LTL/Truckload Services Transportation & Distribution Global Supply Chain Management Global Trade & Economics Supply Chain Security & Risk Mgmt
KEYWORDS Global Gateways Global Trade & Economics Transportation & Distribution
  • Related Articles

    Coffee Growers in Crisis Face New Blow From Trump Tariff Threat

    China Bets Vast Supply Chain Can Swallow Trump's Tariff Pain

    Mexico Border Wait Times Spike as Trump Threats Slow Traffic

Bloomberg

FedEx to Cut Management Jobs by More Than 10%, CEO Says

More from this author

Subscribe to our Daily Newsletter!

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • DOCUMENTS BEARING THE INSIGNIA OF US CUSTOMS AND BORDER PROTECTION LIE ON A TABLE

    New CBP Regs Call for Greater Diligence by Brokers in Reporting Security Breaches

    Freight Forwarding/Customs Brokerage
  • A WORKER IN A WAREHOUSE, SUPERIMPOSED WITH GRAPHICS SHOWING SUPPLY NETWORK

    Enabling Intelligent Visibility With Supply Chain Analytics

    Data Management (Big Data/IoT/Blockchain)
  • A GROUP OF WORKERS RANGED IN AN OFFICE, OF DIVERSE RACE, GENDER, AGE AND PHYSICAL ABILITY

    Podcast | The Supply Chain Workforce of the Future Is Already Here

    HR & Labor Management
  • GSCMS-Promo.png

    Watch: Introducing the Global Supply Chain Marketing Summit

    Education & Professional Development
  • A HAND TURNS A LARGE, LIGHTED DIAL WITH THE WORD RISK ON IT iStock-NicoElNino-1364371014.jpg

    Measuring KPIs and KRIs for Comprehensive Supplier Performance Management

    Technology

Digital Edition

Scb nov 2022 sm

2022 Supply Chain Innovator of the Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Honeywell Intelligrated IFM
Infor Inmar Keelvar
Kinaxis Korber Lean Solutions Group 2H
Liberty SBF Locus Robotics Logility
LogistiVIEW Lucas Systems MCA Connect
MPO Nvidia Old Dominion
OpenText ORTEC Overhaul
Parsyl PMMI QIMA
Redwood Logistics Ryder E-commerce by Whiplash Saddle Creek Logistics
Schneider Dedicated Setlog Holding AG Ship4WD
Shipwell Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing