Mexico Integral to Logistics Leader's StrategyFri, 09/01/2017 - 11:49
Mexico has enjoyed solid growth over the past years but a lack of infrastructure could hinder its potential, says the Managing Director of DACHSER’s Mexican subsidiary, Christian Speit, who nonetheless sees a solid future for the country’s industries. “In this emerging market, we have seen growth for decades and perceive it as the country with the greatest potential in Latin America.”
DACHSER understands diversity. The German company was founded in 1930 during the Great Depression, amid the Wall Street stock exchange’s collapse that took the global economy with it. Today, the logistics provider acts with a long-term vision for business, client relationships and the environment. “Any decision we make is based on achieving sustainable growth. The fact that we achieve healthy year-on-year growth proves that this strategy is working,” says Speit. Now that Mexico has captured nine of the last 11 announced assembly plants in North America, as reported by the Center for Automotive Research, Mexico’s importance has grown for DACHSER, a global leader in logistics, to become a focal location for the company. “We obtained the best results in the history of DACHSER Mexico in 2016, reaching double-digit growth and we expect to do the same in 2017,” says Speit.
Bernhard Simon, DACHSER’s CEO, reiterated the company’s strength at a press conference in April 2017, having maintained a stable global market position through organic growth. “DACHSER continued to grow in fiscal year 2016, generating consolidated gross revenue of around €5.71 billion, representing a consolidated revenue increase of 1.7 percent on the previous year.” Tier 1 and 2s represent the majority of DACHSER’s automotive clients in Mexico, for whom maritime and air freight are the most popular solutions. Speit says the company plans to implement other services, such as road freight and consolidated logistics, that would complement its solutions.
Speit says the company stands out because it adapts to the client, offering a range of solutions for air and sea and additionally offering integrated connection to the company’s comprehensive European road network. Clients have visited the company specifically looking for this personal service after having been disappointed by competitors in logistics, says Speit. DACHSER Mexico is also moving into consumables and pharmaceuticals but automotive continues to represent 60 percent of DACHSER’s local operations.
Environmentalism plays an important role in the company’s strategy. It is driving toward greener operations and calls on its suppliers to follow suit if they want to partner up. As a European leader in environmental activities, DACHSER works with stakeholders throughout Europe to reduce air pollution. “This is more difficult in Mexico because we do not operate our own logistics facilities here,” says Speit. The company would ideally implement more environmentally friendly engines in its trucks as it does among its subcontractors in Europe. “But we take care to choose suppliers that share our green perspective and comply with emissions restrictions.”
Working in Mexico has its challenges and chief among them for many logistics companies is the local infrastructure. according to Speit. Transport companies have expanded and serve the emerging and established industries effectively but without investment in ports, airports and railroads, the country will fall behind. “Using cargo trains would reduce pollution because there would be fewer trucks on the highways,” he says. “Mexico is already investing in the Lazaro Cardenas port and in the new airport in Mexico City but the economy is growing even faster than the transport links.”
To ensure smooth operations, whichever mode of logistics is chosen, DACHSER offers another transport management system that links all activities on the ground and warehousing, which tracks every delivery. Labeled Othello, it was rolled out in Mexico in April 2017 to ensure uniform operations across sea and air freight. “Having standardized processes that are well integrated with our global, selfdeveloped IT systems has been the key to DACHSER’s worldwide success,” says Speit. “Our goal is to be the best integrated logistics option for our clients, so we want to grow in line with them,” says Speit.