Jaime Tabachnik
CEO and Co-Founder
Solvento
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Expert Contributor

Mexico's Trucking Industry Demands Regulations

By Jaime Tabachnik | Wed, 11/16/2022 - 10:00

The freight trucking industry in Mexico represents 3.34 percent of Mexico’s Gross Domestic Product (GDP) and provides service to 71 economic activities, while also generating 2.73 percent of employment nationwide, according to information from the National Chamber of Freight Transport (CANACAR).

Road transport continues to be key in cargo distribution in Mexico. It covers 84 percent ​​of services and moves around 551 million tons per year, compared to 9 percent for maritime, 7 percent for rail and 0.02 percent for air, reported the Statistical Manual of the Transport Sector (IMT). 

Road transport is very important for the Mexican economy and those in charge of logistics, so it is necessary to implement strategies that support the industry in the country as there are serious issues that hinder its operation.

The new head of the General Directorate of Federal Road Transport (DGAF), Laura Nohemi Muñoz Benítez, and the  directors of CANACAR and the Ministry of Infrastructure, Communications and Transportation (SICT) had a meeting to solve urgent matters about the operation of the federal freight trucking industry. 

The president of CANACAR, Ramón Medrano Ibarra, explained the problem of the over-regulation of freight transport in the country. He recalled the proposal for the General Law of Road Transport made by the chamber in 2020, which, in addition to updating the legal framework of freight transport, included several points that must be adapted in the New Mobility Law.

Among the issues, he highlighted the importance of having a regulation that organizes the costs and guidelines for  towing services, in addition to closing any possibility of extortion related to the costs of that assistance.

The result is that companies dedicated to towing services, salvage and storage units charge users and carriers up to 100 times more than the value authorized in the official tariff, according to the National Confederation of Mexican Carriers (CONATRAM). In some cases, carriers must pay up to MX$150,000 per 10 kilometers for the dragging of their units.

For this reason, CANACAR explained the relevance of updating the new routes, as established in the current Weights and Dimensions Regulations.

Delays in Vehicle Procedures

Another relevant issue is the renewal of the vehicle fleet, so it is important to simplify and digitalize all possible processes to make the renewal of licenses, registration and deregistration of trucks, replacement of license plates and express authorization faster and safer.

It is necessary for the metropolitan center to adapt to the times established in the National Catalog of Procedures and Services and in the Procedures Manual of the DGAF, as there are procedures that take up to months. In the last decade, the renewal of heavy vehicles has increased by 2 percent, while the population has increased by 38 percent and the fleet registered with the SICT grew by 30 percent.

According to data from the National Association of Bus, Truck and Tractor Producers ( ANPACT), more than 250,000 heavy vehicles should no longer be circulating on Mexico's roads. For this reason, CANACAR points out the need to implement a limit on years of operation, as well as a program that encourages the withdrawal of obsolete equipment from circulation and economic support for fleet renewal.

Mexico Freight Shipping at the Border

Another theme is Mexico Freight Shipping at the border. Every day, nearly 35,000 trucks cross the Mexico-US border. Though a vast majority of shipments move without issue, shipping in Mexico has unique risks. On average, there are more than 17,000 annual incidents of cargo theft from  Mexican trucks, according to the FBI

To protect cargo, it is important to use multiple sources to verify and validate carriers to make sure they comply with all rules and regulations. They should be instructing drivers to take safer routes and where to stop for breaks and fuel. Using Customs-Trade Partnership Against Terrorism (CTPAT) as a source is a good way to add security.

The number of high-risk areas is increasing and certain highways have emerged as top targets for cargo theft, so it is necessary to work with an experienced provider that has a planned route that avoids higher risk areas. Some shippers even change routes and schedules to avoid establishing predictable routines.

As well, it is important for shippers to have an insurance policy that covers freight while it travels in Mexico, to use GPS and other technology to monitor shipments in real time and provide visibility and to become familiar with the safety protocols for loading and unloading.

If the regulations are implemented, Mexico's trucking industry will grow and, as a consequence, so will the country's economy.

Photo by:   Jaime Tabachnik