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Borderlands: Mexico’s automotive production rises 31% in August

Total exports of Mexican-made passenger vehicles increased 17% year-over-year in August to 248,704 units. Pictured is the General Motors factory in Ramos Arizpe, Mexico. (Photo: General Motors de Mexico)

Borderlands is a weekly rundown of developments in the world of United States-Mexico cross-border trucking and trade. This week: Mexico’s auto production rises 31% in August; Mission Produce and NatureSweet enter 3PL partnership; Automated bookkeeper for trucking gets backing from Google; and CBP makes largest meth seizure in Del Rio port of entry’s history.

Mexico’s auto production rises 31% in August

Mexico’s production of passenger vehicles registered its highest monthly total of the year with 316,815 units in August, a 31% year-over-year (y/y) increase.

Total exports of Mexican-made passenger vehicles increased 17% y/y in August to 248,704. The U.S. remains the main export market at more than 80% of units produced, followed by Canada, Germany, Colombia and Puerto Rico.

The increase in production was due to supply chains and parts inventories improving from earlier this year, said Guillermo Rosales, deputy director general of the Mexican Association of Automobile Dealers.

“The circumstances that have arisen in the Mexican market in recent months indicate that greater availability of inventories is on its way, and we are reporting greater product availability in many brands,” Rosales said Wednesday during a monthly press conference.

He and other automotive industry officials cautioned that supply chain issues could arise again later this year and in the early part of 2023, disrupting production across the industry. 

“We are still in a phase of slow recovery — this will give us a better perspective for the start of 2023,” Rosales said. “However, uncertainty continues to be present in the global panorama of the automotive industry.”

Fausto Cuevas, director general of the Mexican Association of the Automotive Industry, said shortages of semiconductor chips continue to affect the global automotive industry.

“Our expectation is still that there will be a slow recovery; we don’t expect to return to 2019 pre-pandemic levels until the end of 2024,” Cuevas said during the same press conference as Rosales.

Mexico’s automotive production industry — which includes passenger vehicles as well as heavy-, light- and medium-duty trucks — has more than 30 foreign-owned factories across the country. It includes automakers such as Chevrolet, General Motors, Ford, Mazda, Nissan, Toyota, BMW and Volkswagen.

GM was the top auto producer in Mexico in August. The company assembled 70,874 units during the month, a 119% y/y increase. Exports of GM vehicles from its Mexican factories increased 202% y/y to 65,695 units. GM produces its Chevy Equinox, Blazer and GMC Terrain in Mexico.

Stellantis produced 43,626 units in August, a 12% y/y increase. Exports of Stellantis vehicles declined 9% y/y to 31,521. In Mexico, Stellantis produces its Jeep Compass crossover, Ram 1500 and Ram heavy-duty pickup trucks.

Toyota, which makes its Tacoma in Mexico, increased production 41% y/y to 24,214 units, and exports increased 23% to 18,342. Ford Motors produced 22,457 units, a 16% y/y increase. Ford makes its Maverick, Bronco Sport and Mustang Mach-E in Mexico.

Nissan produced 35,203 units in August, a 25% y/y decline, and exported 18,224 units, a 49% y/y decline. In Mexico, Nissan makes its Versa, Sentra, Frontier, NP300 and Renault Alaskan pickups.

Mercedes Benz recorded a 223% increase in production during August at 9,833 units. The German automaker also exported 8,584 units.

According to FreightWaves’ SONAR platform, outbound freight volumes in Laredo, Texas, (OTVI.LRD) are up about 3% since Monday but down 6% from the same period in 2021. The U.S.-Mexico port of entry in Laredo is one of the busiest inland ports for cars and auto parts in the country.

Chart: FreightWaves SONAR. To learn more about FreightWaves SONAR, click here.

Mission Produce and NatureSweet enter 3PL partnership

Mission Produce and NatureSweet Tomatoes recently announced a long-term 3PL partnership aimed at leveraging the avocado company’s 261,000-square-foot distribution center in Laredo.

The partnership will support the expansion of NatureSweet’s greenhouse produce portfolio, which includes tomatoes, cucumbers and bell peppers.

Mission Produce (NASDAQ: AVO) will provide NatureSweet with cold storage, cross-docking, repackaging, inventory management, inspections and other services. NatureSweet plans to consolidate about 70% of its total volume of produce from Mexico at Mission’s Laredo facility and distribute it to U.S. customers throughout the Southwest, Midwest and east of the Mississippi.

Oxnard, California-based Mission Produce is a major producer and distributor of avocados and other fresh produce. NatureSweet Tomatoes is a San Antonio-based tomato grower.

Automated bookkeeper for trucking gets backing from Google

Dallas-based DUKE.AI was recently awarded a $100,000 grant from Google’s Startups Black Founders Fund, according to Dallas Innovates

DUKE.AI, founded in 2019, is an automated bookkeeping and accounting software platform designed for the trucking industry. The technology aids document processing workflows for office payment processing and accounting. The company was founded by Marcus Cooksey.

“We’re excited to get to work with Google support to scale DUKE.AI’s automated invoicing and payments solution to both banks and carriers in the $800 billion trucking industry,” the company said in a LinkedIn post.

The Google for Startups Black Founders Fund provides non-dilutive cash awards to Black led startups that have participated in Google’s programs or have been nominated by a partner community or previous recipient. Recipients receive $100,000 in capital along with Google Cloud credits and support to help their startup grow.

CBP makes largest meth seizure in Port of Del Rio’s history

U.S. Customs and Border Protection (CBP) officers at the Del Rio port of entry in South Texas recently discovered more than 1,300 pounds of methamphetamine in a tractor-trailer from Mexico.

The Del Rio port of entry is along the border about 152 miles west of San Antonio. 

CBP officers were inspecting a tractor-trailer hauling a shipment of diesel tank reservoir containers on Monday. Officers discovered 320 packages of alleged methamphetamine within the shipment.

The narcotics had an estimated street value of $11.9 million and was the largest seizure in the port’s history, according to officials.

CBP officers turned the case over to Homeland Security Investigations.

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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]