Borderlands: Mexican auto production revs up; Trump OKs new international rail bridge

Auto manufacturing and sales in Mexico rebound in July

Automotive production in Mexico broke out of a four-month slump in July, according to data from several Mexican industry trade groups.

The sale of commercial cargo trucks jumped 80% in the month, according to figures released Friday by Mexico’s National Association of Producers of Buses, Trucks and Tractors (ANPACT).

Total wholesale sales of commercial cargo trucks (Class 4 to Class 8) were 2,412, an 80% improvement over July 2019, when truck makers were faced with new diesel fuel regulations from Mexico’s government.

Class 8 trucks represented the largest segment of sales, with 1,025 sold, followed by fifth-wheel tractors at 1,054 units.

Retail sales of commercial cargo trucks fell 18% to 2,478 in July, compared to the same month last year. It was an improvement over retail sales in June, which registered a drop of 48% compared to June 2019.

Most passenger carmakers in Mexico also saw improvement last month, according to figures released Thursday by Mexico’s National Institute of Statistics and Geography (INEGI).

A total of 294,946 passenger vehicles were produced in July, 0.65% more than in the same period of 2019.

From March through June, both manufacturing and exports of passenger cars plummeted, with the largest drops occurring in April and May, when the year-over-year decline exceeded 90%.

Mexico also shipped 256,098 vehicles abroad in July, a 5.47% decrease compared to the same month in 2019. BMW, Ford, Mazda and Toyota were the only automakers with export gains in July compared to the same period in 2019.

July represents the second full month Mexico’s auto production industry resumed after the Mexican government suspended businesses across the country March 30 to stem the spread of the coronavirus.

Julio Santaella, president of INEGI, said Mexico’s auto production industry has turned a corner.

“The production of light vehicles shows a direct recovery since registering only 3,722 units produced in April 2020, the first month of confinement; in July 294,946 units were registered, almost the same production as a year earlier (293,035),” Santaella tweeted.

Santaella added, “the export of light vehicles — registered 27,889 units exported in April 2020, the first month of confinement, to 256,098 units registered in July, the year-over-year decline went from 90.2% in April to 5.5% in July.”

Carmakers with production increases in July include:

BMW — production increased 229%, manufacturing 6,013 vehicles
Ford — 59%, 27,009 vehicles
Toyota — 29%, 16,304 vehicles
Mazda — 23%, 10,116 vehicles
Volkswagen — 19%, 38,394 vehicles
Nissan — 12%, 43,010 vehicles
General Motors — 6.2%, 82,156 vehicles
JAC Motors — 1.7%, 401 vehicles
Audi — 0.7%, 13,134 vehicles

Automakers that had production declines in July include Fiat-Chrysler at 43%, KIA at 35% and Honda at 15%.

Trump signs KCS permit for second international rail bridge in Laredo

Kansas City Southern (NYSE: KSU) will soon have a new international rail bridge between Mexico and the United States.

President Donald Trump approved Kansas City Southern’s (KCS) application for the United States Presidential Permit July 30 for the construction of a second rail bridge in Laredo, Texas.

The bridge will be constructed adjacent to and just south of the current rail bridge, west of downtown Laredo, according to Warren K. Erdman, executive vice president of administration and corporate affairs at KCS.

“On a given day the bridge will serve crossings of anywhere to 23 to 30 trains per day. It is reaching its capacity,” Erdman told the Laredo Morning Times.

The second bridge will allow for operation in both directions simultaneously, moving trains out of Laredo faster, Erdman said.

KCS is currently conducting design and engineering studies on the structure and won’t know the final cost of the project until the studies are completed in eight to 12 months’ time.

KCS officials said they hope to have the rail bridge completed within three years.

KCS applied for the permit March 3 and was approved less than five months later. Trump signed the permit without prior notice to KCS or Laredo officials during a fundraising visit in Midland, Texas.

Mexican carrier acquires 25 new Scania trucks

The Santa Lucía Cargo Transport Co. recently acquired 25 new Scania tractors, giving the cross-border carrier a total of 53 Scania trucks in its fleet.

The new tractors are Scania’s R450 A6x4 midsize tractor models. Headquartered in Sweden, Scania, is part of Volkswagen’s Traton Group. The company has production facilities in Sweden, France, the Netherlands, India, Argentina, Brazil, Poland, Russia and Finland.

With the purchase of the 25 tractors, the Santa Lucía Cargo Transport Co. is one of the largest Scania customers in Mexico.

The company was founded in 2001 and is located in Ensenada, Mexico, around 90 miles south of San Diego.

It has a fleet of 150 trucks and offers flatbed and dry van services across Mexico and up to the California-Mexico border.

Border officers seize more than $2.4M at San Diego ports

U.S. Customs and Border Protection (CBP) officers seized more than $2.4 million in undeclared cash over the past several months across Southern California ports of entry on the U.S.-Mexico border.

CBP officials said all the cash was bound for Mexico and seized in different incidents between April and June at ports of entry including Calexico, Otay Mesa, Cross Border Xpress, San Ysidro and Tecate.

One of the largest cash seizures occurred in May when a truck was stopped at the Otay Mesa port of entry near San Diego. Officers discovered money hidden in boxes with other items in the cargo area of the truck.

“These various interdictions by our vigilant officers are just a fraction of the regular attempts we see during the year,” said Pete Flores, director of field operations for CBP in San Diego. “This is a demonstration of our officers’ efforts in stopping the illegal movement between our borders.”

Click for more FreightWaves articles by Noi Mahoney.

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