Trucking Growth Tied to USMCA, Political Shifts, Nearshoring

Mexico is poised to capitalize on nearshoring and deepen its role as a key player in North American trade, but uncertainties tied to the USMCA and political dynamics in both Mexico and the United States could hinder this development. Redflags such as legal uncertainty, regulatory challenges, and upcoming political elections must be carefully navigated to fully realize this potential, argued experts during the “Nearshoring in North America and its Impact on the Trucking Industry” webinar.

One of the key red flags that the previous Mexican administration left behind is the restriction of private participation, which violates the USMCA, says Kenneth Ramos, Partner, AGON Economía/Derecho/Estrategia. Mexico must address this issue to maintain its standing in international trade, he adds.

Despite these concerns, the Mexican economy boasts structural advantages that should bolster it in the medium term, with nearshoring presenting significant potential. Nearshoring has positioned Mexico to profit from long-term geopolitical tensions, protecting its access to one of the largest markets in the world. Key sectors that could attract investment include automotive, aerospace, machinery, medical equipment, pharmaceuticals, and logistics. Factors like stricter rules of origin and the importance of national security are driving these trends, creating vast opportunities.

The USMCA has modernized NAFTA while preserving free trade in North America. It has already delivered tangible results, with US-Mexico trade reaching US$784 billion in 2022 and US$799 billion in 2023, making Mexico the United States’ top trading partner. Investments are pouring into Mexico from United States and Canadian companies, particularly in logistics, transportation, and fleet development, argued Ramos during the webinar.

Ramos explains that while nearshoring offers many opportunities for growth, China still dominates US trade, though Mexico has an opportunity to substitute it, especially as tariffs rise. Opportunities in machinery, electric equipment, and other sectors give Mexico a competitive edge over China. However, Mexico’s fiscal deficit, legal uncertainties, and previous constitutional reforms create a complex economic context, he adds.

USMCA and the 2026 Review

The upcoming 2026 USMCA review will be pivotal, says Ramos. He argues that if Donald Trump returns to office, the agreement could face aggressive enforcement, potentially impacting Mexico’s position. Trump’s stance on immigration, drug smuggling, and trade tensions with China may increase the value of preferential US access for Mexico. On the other hand, Kamala Harris could prioritize labor issues and cooperation on climate change, fostering the potential for a North American Green Agenda, says Ramos.

Both US presidential candidates, however, signal uncertainty for the USMCA. Trump may pull back from clean energy commitments, creating a window for Mexico to strengthen its position. Harris, in contrast, might push for stronger environmental regulations, which could benefit Mexico’s renewable energy sector. Regardless of who wins, the 2026 renegotiation will likely involve stricter enforcement of trade rules, with Mexico needing to adapt accordingly, says Ramos.

Bob Costello, Chief Economist and Senior Vice President, American Trucking Associations, highlights the importance of trucking to the North American supply chain, with 70% of cross-border trade value between Mexico and the US moved by trucks. Since 2018, Mexico’s role in the supply chain has surged, and the continued rise in nearshoring will only strengthen its position as a vital partner in US trade. Cross-border freight generates significant revenue for US motor carriers and employs nearly 100,000 workers, underscoring the importance of this relationship, adds Costello.

However, infrastructure challenges remain a concern. Mexico’s border infrastructure could be modernized to handle the growing trade volume, while US Customs and Border Protection (CBP) needs more officers and advanced technology to expedite cross-border traffic. Southbound inspections are another issue that requires attention, and modernized, non-intrusive technologies will be crucial in the coming years, says Costello.

Lak Shoan, Director of Policy, Canadian Trucking Alliance (CTA), emphasizes the importance of keeping the USMCA relevant in the face of changing business environments. For the trucking industry, challenges such as transit policies, inefficient paperwork, and customs penalties remain barriers to growth. Shoan called for joint inspections and shared facilities between Mexico, the United States, and Canada to reduce costs and improve efficiency.

The CTA also raised concerns about security and supply chain inefficiencies. Temporary admission of goods, empty trailer repositioning, and visa processing delays are areas where policy improvements are needed. Security, particularly in Mexico, is a growing concern for foreign direct investment. As crime and insecurity rise on Mexico’s roads, businesses are investing heavily in safeguarding their operations.

Modernization and Cooperation

Martin Rojas, Senior Adviser for the Americas, International Road Transport Union (IRU), says that for North America to fully realize the potential of the USMCA, modernization and infrastructure development are essential. Border modernization and cooperation between governments on trade facilitation are key. Mexico is opening new cooperation mechanisms with the United States to enhance trade and border crossing efficiency, which could alleviate some of the logistical bottlenecks companies face.

Tax policy, customs operations, and migration issues will require close collaboration between the three North American countries. The trucking industry, which is the backbone of the USMCA according to Rojas, must continue to work together to identify and address challenges and opportunities in the evolving landscape of North American trade.