19 | MAY | 2019
Delays at US-Mexico border cause multi-million dollar losses for both countries
Trailers now have to wait between 4 and 7 hours to cross the border - Photo: Jorge Duenes/EL UNIVERSAL

Delays at US-Mexico border cause multi-million dollar losses for both countries

09/04/2019
15:16
Newsroom & Agencies
Mexico City
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The U.S. Congress will not ratify the USMCA until Mexico issues a labor reform, which could be approved before May 1

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Long delays at the U.S.-Mexico border crossing for goods destined for American plants and consumers are hitting the U.S. auto industry, and the delays also drastically reduced the number of northbound trucks that crossed the entry point last week.

The U.S. government’s decision to move 750 agents from commercial to immigration duties to handle a surge in Central American families seeking asylum in the United States has triggered the delays at crucial ports on a border that handle USD $1.7 billion in daily trade.

“The situation in Ciudad Juárez is very serious because these auto parts go to plants in the United States and obviously they put at risk the operation in the United States,” said Eduardo Solis, the president of the Mexican Auto Industry Association (AMIA).

The North American auto industry is highly integrated and many car parts cross the border several times before they are finally installed on a vehicle.

Seventeen hours before the crossing to El Paso even opened on Monday morning, trucks were already lining up in Ciudad Juárez to avoid the fate of some 7,500 trailers that failed to cross last week, said Manuel Sotelo, vice president at the Mexican National Chamber of Freight Transport’s north division, roughly half the number of trucks that usually cross there per week, carrying everything from car and plane parts to refrigerators, washing machines, TVs, cellphones, and computers.

“This is not normal. We had never seen this before in Ciudad Juárez,” said Sotelo.

Despite elevated costs, some Mexican exporters are turning to air freight to avoid the mile-long lines at the border.

“We’re using charter (planes) which cost between USD $35,000 and $100,000 depending on the volume and merchandise,” said Pedro Chavira, who heads the manufacturing industry chamber INDEX in Ciudad Juarez.

So far, business leaders have reported losses calculated at USD $1,000 million per day on both sides of the border, as a result of the delays.

Octavio de la Torre de Stéffano, the vice-president of the Canaco trustees, said that officials from the Finance Ministry will meet with members from the Department of Treasury to discuss the issue.

On the other hand, the U.S. Congress will not ratify the USMCA until Mexico issues a labor reform, which could be approved before May 1.

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