Mexico-based supplier establishes position in global manufacturing

Borderlands Is a weekly summary of developments in the world of cross-border trucking and trade between the United States and Mexico. This Week: Mexico-based suppliers have established themselves in the global manufacturing industry. John Deere has transferred some of its US operations to Mexico. Texas authorities have established the Gulf Joint Operations Center. A truck driver has been charged with attempting to smuggle $ 18 million worth of stimulants.

Mexico-based supplier establishes position in global manufacturing

While China and other Asian countries are still important components of the global supply chain, procurement bids for Mexican suppliers are skyrocketing, said Jim Bureau CEO. JaguarA US-based technology provider of cloud-based business automation software.

“In the United States, from 2020 to 2021, procurement from the Asia Pacific region decreased by about 30% and in Latin America increased by about 150%, which is quite important,” Bureau told Freight Waves. rice field.

Based in North Carolina, Jaggaer provides automated sourcing solutions to 1,700 global customers, including manufacturers such as Siemens and Hitachi.

According to Bureau, Jaguar manufacturing customers are not necessarily completely abandoning Asian suppliers, adding Mexico-based suppliers to their customer base to diversify their supply chains. ..

“What our customers are doing is adding suppliers to the mix, which complicates things because we have to manage a wider supply base,” says Bureau. .. “But looking at how these people are currently managing things, there are so many moving parts in the supply chain. Companies also have responsible procurement and nearshoring to stop the turmoil. I’m trying to manage. “

Recently based in Germany Siemens publication Plans to build a $ 35 million electrical components plant in Nuevo Leon, Mexico. The products are exported to Siemens customers in North America and Europe. Nuevo Leon is just outside Monterrey, Mexico, about 139 miles from the US-Mexico border.

Siemens has facilities in more than 200 countries, including 10 in Mexico. Its customers include aerospace maker Raytheon and truck maker Navistar, which recently opened a major factory in San Antonio.

The agency said the move to find more suppliers in Mexico was due to higher shipping costs from Asia and longer waiting times for goods.Some COVID related Blockade More global delays and route adjustments have occurred in China in recent months.

“We need to be able to get the goods from point A to point B, even after procuring the goods,” says Bureau. “Currently, it costs twice as much and takes twice as long to get from the Asia Pacific region.”

As of Friday, the cost of moving a loaded container from China to the west coast of the United States (FBXD.CNAW) Was $ 9,573.72, an increase of 55% compared to the same period in 2021, according to the Freightos Baltic Index (FBXD.CNAW). Fares on the west coast of Asia have fallen dramatically since May 3, when the spot rate was $ 16,365.74.

Chart (FBXD.CNAW): Freight Waves sonar. Click for more information on FreightWaves SONAR. here..

As manufacturers diversify their logistics chains with both Asian and Latin American suppliers, maintaining quality control, inventory management and risk management can be more difficult, Bureau said.

“The reason we have one or two major suppliers is that we have real-time inventory managed by the vendor and quality assurance programs are available. Duplicating with suppliers from multiple countries is not an easy task,” said the bureau. Says. ..

“That is, what Jaggaer does is the big picture. We connect buyers and sellers through what is called a self-guided B2B commerce model, and if possible, self-guided enable machine learning. Set parameters, or artificial intelligence to enhance sourcing events and enhance purchase and vendor-managed inventory. ”

John Deere transfers part of US business to Mexico

John Deere plans to move the tractor cab assembly from Waterloo, Iowa to Ramos Arispe, Mexico by the recently announced 2024.

The decision to relocate the business was based on labor market costs, according to John Deere officials.

“John Deere’s plan to introduce a new product program into its business in Waterloo, Iowa requires integration of cab manufacturing. [Waterloo] To [Ramos Arizpe].. The decision to relocate cab production allows the company to balance labor needs in a tough labor market, while at the same time allowing Waterloo to increase floor space to produce new products. “We will do so,” the company said in a statement emailed to the media.

The Waterloo plant has approximately 1,500 employees, including 1,100 production workers. The number of jobs affected by moving the production line to Mexico is not clear.

According to United AutoWorkers Local 838, which represents about 3,000 workers in the Waterloo region, production workers at the Waterloo plant can earn about $ 22 to $ 33 per hour.

John Deere (NYSE: NYSE: based in Moline, Illinois DE) Is a global farm and construction machinery manufacturer. The company has more than 100 factories in 30 countries around the world.

Texas authorities establish joint Gulf Operations Center

Texas officials recently announced the establishment of a Joint Information Operations Coordination Center (JIOCC) in Houston with the goal of creating a unified response to coastal disasters and crime prevention initiatives.

JIOCC will be a joint management center that coordinates the operations of the United States Coast Guard between the Houston-Galveston sector. Homeland Security Investigation Houston (HSI), US Customs and Border Protection; Houston and Transportation Security Administration (TSA).

“By combining and leveraging the unique strengths, powers and capabilities of each agency, we are in a good position to protect ports and waterways in southeast Texas and southwest Louisiana,” said Coast Guard Jason. Captain Smith said in the announcement.

The center will be staffed by the Coast Guard, HSI, CBP and TSA. JIOCC staff will include a full-time Texas Military Forces counter-drug analyst whose focus will be on providing analytical support for HSI components.

JIOCC also serves as an event command post in the event of a natural disaster or other emergency.

Tracker was charged with attempting to smuggle $ 18 million worth of stimulants

According to Texas officials, a 33-year-old truck driver was charged with trying to import more than £ 881 of methamphetamine.

A federal grand jury in Laredo, Texas, recently charged Luis Alberto Garza Cisneros with two charges. release From a US law firm in Southern Texas.

Officials said Mexican citizen Cisneros attempted to enter the United States from Mexico on May 6 by driving a tractor trailer carrying stainless steel scrap. Officers of the World Trade Bridge in Laredo reportedly discovered methamphetamine in 24 5-gallon buckets in the tractor’s diesel tank.

Officials say the estimated value of these medicines is $ 18 million.

If convicted, Cisneros faces life imprisonment and can be fined up to $ 10 million. No trial date has been set.

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