Mexico surpassed China in 2023 to become the United States’ top trade partner, with the value of imported goods pegged at more than $475 billion. Mexico’s growing importance to the U.S. can be attributed in part to America’s deteriorating trade relationship with China and the rise of the nearshoring movement, in which manufacturers transfer production operations closer to the end consumer.
President-elect Donald Trump has vowed to implement a 25% tariff on all goods from Mexico, and the country’s president, Claudia Sheinbaum, has threatened to put retaliatory measures in place.
“The response to one tariff will be another, until we put at risk companies that we share – yes, that we share,” Sheinbaum was quoted as saying.
“For example, among the principal exporters from Mexico are General Motors, Stellantis and Ford Motor Co., which arrived in Mexico 80 years ago. Why put a tax on them that will put them at risk? It’s not acceptable,” she continued. “And it would cause inflation and job losses for the United States and Mexico.”
U.S. auto manufacturers could be among the companies hard hit by tariffs on products from Mexico. USA Today cited a Congressional Research Service report that said “the seats that go into vehicles assembled at plants in the U.S. Midwest may first crisscross the U.S.-Mexico border seven or eight times as components are added on one side and the other.”
That’s just the seats.
“For the United States and its trading partners, the resurgence of protectionism in an interconnected world poses a slew of economic, strategic, and institutional risks,” a Brookings analysis said.
State of US-Mexico Trade Relations
ChemAnalyst said that “in a move not inspired by Trump’s threats,” Mexico in December announced it was raising tariffs by 15% on 17 categories of textile goods, including denim and polyester fibers, and up to 35% on 138 types of finished garments.
The tariff hikes, which are to remain in place until April 22, reportedly are designed to protect jobs in Mexico’s textile industry.
Mexico also closed a trade loophole that allowed U.S. companies and e-commerce sellers to avoid paying tariffs on clothing items that were stored in Mexican warehouses before being sent directly to U.S. consumers. That change in the Section 321 rule could force clothing retailers, in particular, to rethink their sourcing and supply chain strategies.
New tariffs imposed by either country could violate the terms of the United States-Mexico-Canada Agreement (USMCA). Trump may be looking for ways to get around that. Although the USMCA is scheduled for renegotiation in 2026, Trump has said he wants that to happen this year.
Still, Hamish Woodrow, head of strategic analytics for Motive, which tracks trucking visits to North American distribution facilities for the top five retailers, told CNBC that Mexico could remain the United States’ top trade partner until at least 2030.
“There will be a need for more factories to produce computer-related machinery and parts and we could see the development of more manufacturing and assembly plants in Mexico,” Woodrow said. “With Mexico’s strategic position and close proximity to the U.S., we can imagine continued growth in this sector and Mexico imports overall as Mexico expands its role in making and sending these products to the U.S.”
Emerging Trade Opportunities
Inc. said for U.S. businesses, the benefits of nearshoring include:
- Product accessibility.
- Risk mitigation.
- Optimized partner collaboration.
- A more responsive supply chain.
“To facilitate a smooth transition to nearshoring supply chains, companies often partner with a third-party logistics provider that is informed and experienced in matters of cross-border operations,” Inc. noted.
A number of benefits of cross-border shipping from Mexico have been identified, including:
- Strategic location. The law firm of Foley & Lardner said in a manufacturing industry advisory that Mexico’s proximity to the United States “makes it an ideal location for nearshoring. Its shared border with the U.S. significantly reduces shipping times, lowers transportation costs, and makes inventory management more agile. With many companies now seeking to reduce their dependency on distant overseas suppliers, Mexico’s position as a neighbor to the U.S. market is a key advantage for industries that depend on quick turnaround times, such as automotive, electronics, and consumer goods.”
- Robust manufacturing sector. Foley & Lardner said Mexico’s manufacturing sector is “well developed and mature, particularly in the automotive, electronics, and aerospace industries. The country offers a strong industrial base and high-quality production capabilities, supported by modern facilities and a cost-effective workforce.”
- Cost-effective solutions. Lower labor costs in Mexico versus the United States and favorable exchange rates can reduce shippers’ overall transportation expenses.
Regulatory and Policy Considerations
International trade is cumbersome, even where countries share borders. Logistics providers and carriers must be armed with a slew of documents to ensure goods are moved across borders without complication – or detention. Electronic documentation minimizes errors and speeds up customs clearance.
The list of documents – paper or electronic – needed to haul freight across the Mexican border into the United States includes a bill of lading, commercial invoice, carrier information, certificate of origin, and U.S. customs declaration.
Infrastructure Developments Enhancing Trade
Infrastructure improvements are making cross-border trade easier. That includes a recently completed 1,170-foot-long, $100 million railroad bridge connecting Laredo, Texas, with Nuevo Laredo, Mexico.
“Completion of this internationally important project more than doubles our capacity to move freight through the border at the largest international trade port of entry in North America,” Keith Creel, the president and CEO of Canadian Pacific Kansas City railroad, said in a statement. “This is an important milestone that keeps Laredo-Nuevo Laredo at the center of North American trade, allowing the secure and efficient movement of more imports and exports across the U.S.-Mexico border.”
The number of trucks at the Laredo border also is increasing. CNBC reported there were more cross-border truck movements in August than ever before, and in September, truck crossings were up 30% year over year.
Strategies for Capitalizing on Opportunities
It’s important to have boots on the ground – and a bilingual staff – near Laredo, the busiest port of entry at the U.S.-Mexico border.
At RJ Logistics, we have a bilingual staff at our Laredo facility dedicated to finding solutions for shippers’ cross-border freight moves and ensuring a headache-free experience. Our team applies its expertise to cross-border rules and regulations, customs compliance, insurance coverage, and cargo security.
“In an era where Mexico’s nearshoring is not just a trend but a strategic pivot for many businesses, our team at RJ Logistics stands ready,” senior international salesman Pablo Illanes said. “With the expansion of nearshoring across Mexico, we’ve been presented with an unparalleled opportunity to leverage our deep-rooted experience with comprehensive resources. Our mission? To deliver the most efficient, reliable, and tailored transportation solutions to our current and future partners.”
Challenges and Risks
In addition to manufactured goods, an estimated 42% of U.S. food imports come from Mexico and Canada. If there is a prolonged International Longshoremen’s Association (ILA) strike at maritime ports all along the United States’ East and Gulf coasts, shippers could divert fruits, vegetables, beer, and more to cross-border trucking.
U.S. retailers also have been looking ahead to potential tariffs and work stoppages. Woodrow told CNBC in October that retailers were “restocking earlier and building extra inventory to shield themselves from unpredictable disruptions.”
In times of uncertainty, it’s more important than ever to work with an expert in cross-border shipping. Real-time tracking and monitoring are absolutely critical. In addition to visibility, real-time tracking and monitoring ensure freight is secure while it is in transit.
At RJ Logistics, our cross-border team provides continuous updates in both English and Spanish. We require all of our thoroughly vetted carriers to be on MacroPoint to give us real-time visibility to all shipments and provide 24/7/365 updates from pickup to delivery. Our carrier partners also are certified through the Customs Trade Partnership Against Terrorism (CTPAT) and have access to the Free and Secure Trade (FAST) lanes to ensure efficient and secure cross-border movements.
Cross-border shipping can be complicated, and we assign dedicated account managers who utilize advanced technology to provide solutions to even the most complex transportation challenges.
RJ Logistics, Your Cross-Border Shipping Partner in 2025 and Beyond
At RJ Logistics, we’re on top of the latest developments in cross-border trade and stand ready to respond effectively to shippers’ every need. And we’re right there where much of the cross-border freight moves are taking place, at our office staffed with international trade experts in Laredo.
We provide:
- Bilingual communication and continuous updates.
- Cross-border shipping expertise to ensure compliance with all international trade regulations.
- Certifications and insurance coverage to guarantee the safety of freight crossing the U.S.-Mexico border.
- Inbound services from the Mexican border throughout the United States.
- Door-to-door and transloading services.
At RJ Logistics, we do whatever it takes to deliver for our customers. We provide simple solutions to complex problems with state-of-the-art technology, industry-favored customer service, and the drive for mutual success. It is our mission to deliver positive experiences for our customers, partners, and community through actions guided by our core values and principles.
In addition to our Laredo office, we have logistics experts at our headquarters in Southfield, Michigan, and at our facility in Indianapolis. Whether it’s cross-border transportation, expedited services, or refrigerated or flatbed freight, RJ Logistics has you covered.
