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Borderlands: Cargamos aims to revolutionize last-mile deliveries across Mexico

Mexico City-based last-mile logistics platform Cargamos has its own fleet of delivery vehicles, but also works with third-party carriers using everything from electric bicycles, motorcycles and cars for deliveries. (Photo: Cargamos)

Cargamos seeks to transform last-mile deliveries in Mexico

Mexico City-based last-mile logistics platform Cargamos has set its sights on next-day deliveries across Mexico by using cloud-based technology and unused infrastructure in Latin America.

The founders of Cargamos saw an opportunity to unlock the potential of Mexico’s growing e-commerce market by turning excess capacity at shopping malls, parking lots and storage facilities into fulfillment centers for not only giant retailers but also mom and pop shops and medium-sized businesses.

“We are shortening the last-mile delivery distances by building personal networks,” Everton Viana, co-founder and COO of Cargamos, told FreightWaves. “We call it a personal network because we are using human delivery hubs, where we sort the packets closer to the clients to the final place where the packet will be delivered. What Cargamos wants to do is to be this enabler of e-commerce, so we can reach the people that normally do not have access to e-commerce because it has been too expensive.” 

Mexico’s e-commerce market enjoyed sales of $20.8 billion in 2021, a 27% increase over 2020, according to the Mexican Online Sales Association (AMVO). The e-commerce market across the country is projected to grow to $60.8 billion by the end of the year, according to Americas Market Intelligence. 

Eduardo Lopez-Soriano, marketing vice president at UPS Capital, told FreightWaves that up to 40% of Mexico’s e-commerce shoppers were buying from U.S. merchants.

Cargamos was co-founded in 2019 by Viana, chief technology officer Fabian Antorveza and CEO Ivan Ariza. Today, the company boasts about 160 full-time employees and has raised over $14 million in seed funding.

Cargamos operates one large fulfillment center in Mexico City along with 20 smaller express distribution centers around the city, with an average delivery time of four hours to the end customer, the company said.

In addition to Mexico City, Cargamos also operates last-mile services in the cities of Monterrey, Guadalajara, Puebla, San Luis Potosi, Queretaro, Pachuca and Merida.

Cargamos sports its own fleet of delivery vehicles and drivers, but its platform allows for third-party carriers to connect to the network, using everything from electric bicycles, motorcycles and cars, according to the company.

“We are improving efficiencies for the whole logistics process by decreasing costs and improving delivery times,” Viana said. “The normal process of last-mile delivery starts normally in the outskirts of the city and then the delivery will go forward using a van, which is traveling around the whole city and spending a lot of hours and gas.

“It’s not efficient because by the middle of the journey they already have a half-empty gas tank. What we are doing is creating additional layers with the delivery hubs that bring us more efficiency in the whole process.”

Viana said the mini-delivery hubs they locate throughout cities in malls and parking garages also allow for smaller vehicles to cross docking with other vehicles, such as cars and motorcycles, bicycles, electric vehicles and electric bicycles.

“The last-mile process that normally takes eight hours, with us in this new infrastructure we’ve created, the last part will be delivered within four hours,” Viana said.

About 80% of the company’s deliveries are smaller packets, but it also delivers electronic items and even some home appliances such as TVs.

Cargamos works with several of Mexico’s largest retailers, including Liverpool, one of the largest department store chains in the country. The company also provides last-mile fulfillment services for small and medium-sized businesses that don’t have their own fulfillment centers, Viana said.

“Now that we already have this infrastructure in place, which is very efficient, we can charge smaller and medium-sized businesses the same price that we are charging the bigger companies,” Viana said. “What we want to do is decrease the cost of logistics, so we can reach more of the population and increase consumption, and then everyone will benefit.”

Pass Automotive to manufacture parts for Tesla in Mexico

German automotive supplier Pass Automotive will provide parts for Tesla from its factory in Irapuato, Mexico, according to Periodico Correo.

The parts produced at Pass Automotive’s Apolo Park facility in Irapuato will be exported to Tesla’s gigafactory in Austin, Texas, where the company is manufacturing Model Y electric vehicles.

Stephan Matz, CEO of Pass Automotive Mexico, said the Apolo Park facility will be expanded by 43,000 square feet and create about 100 more jobs. The plant currently employs 250.

Pass Automotive manufactures automotive plastic hoses, pipes and tubes, as well as some metal components. The company has six global locations and a workforce of more than 4,500. The factory in Mexico is Pass Automotive’s only facility in North America.

Spec truck terminal under construction near Houston

Chicago-based Dayton Street Partners will develop a 164,640-square-foot speculative truck terminal near Port Houston, according to a news release.

The facility will be situated on a 47.4-acre site within the 15,000-acre TGS Cedar Port Industrial Park in Baytown, Texas. The park is located along the Houston Ship Channel. 

The facility will function as a truck terminal as well as a storage and distribution center. The terminal will include 24-foot clear heights, 214 dock doors, 10,000-square-foot maintenance area and more than 6,000 square feet of office space.

“Houston has proven itself as a powerhouse logistics hub,” Dayton Street Partners founder and managing principal Howard Wedren said in a statement. “The opportunity to bring the very first spec truck to the area is tremendous and we look forward to continued involvement in Houston’s logistics market.”

Dayton Street Partners did not provide the project’s cost. The new truck terminal is scheduled to open in 2023. 

Posco International to build EV parts plant in Mexico

South Korean steelmaker Posco has announced plans for an automotive parts plant in the northern Mexican city of Ramos Arizpe.

Posco started construction Wednesday and will produce driving motor cores, a key component of electric vehicles.

POSCO International plans to initially spend about $43 million on construction. The company said it could spend up to $123 million on the facility, producing 1.5 million EV motor cores. 

“Mexico will become our base camp to expand our presence in the North American EV parts market,” Posco International CEO Joo Si-bo told the Korea Herald.

Although the factory won’t open until 2023, the company said it has already received $460 million worth of pre-orders from North American auto companies.

Posco International is a unit of South Korean steel giant Posco Holdings Inc. 

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Noi Mahoney

Noi Mahoney is a Texas-based journalist who covers cross-border trade, logistics and supply chains for FreightWaves. He graduated from the University of Texas at Austin with a degree in English in 1998. Mahoney has more than 20 years experience as a journalist, working for newspapers in Florida, Maryland and Texas. Contact [email protected]