Congestion, capacity and complexity all concerns for cross-border logistics

As OEMs, tier suppliers and logistics companies navigate the complexities and changes of automotive trade with the US at a time of changing policy, trade wars and supply chain flows, experts at the 25^th anniversary edition of Automotive Logistics & Supply Chain Global in Detroit shared insights on optimising cross-border logistics and global trade.

Cross-border trends

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Outlining the current state of cross-border logistics in North America, Ana Lucia Ochoa Lorenzini, global director of supply chain management for the driveline division at tier one supplier American Axle Manufacturing (AAM), acknowledged the strategic importance of Mexico to AAM's operations and highlighted some of the challenges it has faced in transporting goods over the US-Mexico border. "Mexico is central to our logistics network," she explained, adding that AAM has standardised documents in partnership with its carriers and brokers in Houston to reduce dwell time at the US-Mexico border.

"We've seen some challenges with congestion, infrastructure limitation and also the variability in Mexico's carrier capacity affect our operation lately," she noted. "Additionally with the regulatory changes that we have seen in Mexico and the security risk, we have been dealing with that."

To address these challenges, Agustin Sustaita, chief commercial officer at D-Troy Logistics, highlighted the value of real-time visibility. He explained his view that communication and collaboration with customers is vital to fully understand their requirements and the reality they face on a day-to-day basis. "From that standpoint we can figure out ways of being close to them so that we can provide solutions, integrated solutions," he elaborated.

In addition to this, Sustaita said that "sustainability consciousness and awareness" is an important trend today, noting that aligning plans to improve sustainability with supply chain partners can be advantageous.

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The cross-border logistics landscape has changed significantly over the past few years, according to JJ Feregrino, director of strategic sales and supply chain solutions at Agramont Worldwide Logistics. "I think a few years ago, cross-border logistics was mostly about cost efficiency – companies were focused on traditional just-in-time models, predictable flows from Mexican manufacturers into US assembly plants," he explained. "I think today, however, the approach is more strategic and digitally-driven."

He identified three key shifts in cross border-logistics: a move towards nearshoring, stronger emphasis on digitalisation and visibility, and growing concerns over security at the US-Mexico border. "In short, I think cross border logistics today is less about moving goods cheaply and more about moving them smartly," he said. "It's got to be with visibility, compliance, resilience and speed."

Thinking beyond North America,  Antonio Fondevilla, global head automotive at logistics giant Maersk spoke of some wider trends in global trade that are having an impact on cross-border logistics. For example, he noted the shift in China's role within global trade over the past decade. "Ten years ago China was the main importer, today is the main exporter," he said. "Now what we are seeing is a lot of intra-regional inflows – intra-Asia, intra-Americas,  Africa is getting a lot of inflow from Asia... in relation to trading – so we are adapting constantly, I would say daily, to what is going in the market."

Data-driven cross-border planning

One common thread that became apparent as speakers shared their insights into cross-border logistics was the opportunities that technological developments have provided to improve operations across borders. "We have invested in technology [and] data integration between suppliers, carriers [and] our own systems to improve the visibility," Lorenzini remarked. "However, we have seen that reducing the handling of the cargo is also one of the benefits [of this investment] — to reduce the dwell time and the waiting time in these locations."

Feregrino added that, to his mind, "an efficient crossing is one that's consistent and predictable". He emphasised how having the ability to share all relevant shipment information prior to or immediately upon departure can allow customs brokers to begin working on pre-clearance, helping to minimise delays.

Regulatory compliance and tariff complexity

Changing regulation and tariff fluctuations has created a lot of uncertainty when it comes crossing borders, requiring supply chains to be flexible, agile and resilient. Feregrino shared a unique take on how to deal with constant tariff-related news and rumours: "Policy noise is constant, so what we do is we treat it like weather – you watch it, you plan for it, and then you move early." He gave examples of action that can be taken in response to tariff news, such as pre-buying critical SKUs, staging inventory in the US and creating smoother production processes to avoid last minute spikes. "Let's not react to the announcement, act on the signals," he added.

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Sharing this sentiment, Fondevilla said that "changing from reactive to proactive" should be a top priority for supply chains in order to remain resilient in the face of disruption – weather that be from tariffs or other unexpected events like natural disasters.

Sustaita reinforced his view that communication and collaboration is key to ensuring smooth operations, saying: "What we must do is to be very close with our customers in terms of communication so that we can react and we can adapt to what the requirements in that specific period of time is."

Jeffrey Peterson, director of global trade and logistics at automotive parts manufacturer and distributor DRiV, highlighted another issue caused by constantly fluctuations and regulatory complexity: the impact on customs brokerage. "Customs brokers are under a lot of scrutiny. " he said. "They have to learn things in very short order and they have high volumes that are coming in, so we have to have a large degree of sensitivity to what our customs brokers are going through."

Documentation challenges

With regulatory compliance becoming more difficult as a result of changing regulations, the need to ensure correct documentation is provided has never been clearer. This is vital to avoid cargo being held up by customs, adding costly delays to logistics operations. "In the past, some of our freight forwarders trusted us enough to be able to pick up a load without all documents on-hand at the time of pickup," Fondevilla shared. "What I see different now is – and I'm enforcing this within my team – [not to] ship until you have all the documents and we've all verified they're perfectly filled out [because] we don't want any of those loads to get stuck in customs or have to pay fees."

Likewise, Feregrino stresses that it is crucial to "send complete paperwork validation prior to departure so that you avoid delays when you get to the border".

Impact of driver shortages

Driver shortages have long been an issue and that issue still persists today, requiring firms to adjust their strategies in order to ensure that freight can continue to move efficiently across borders. Lorenzini said that AAM, as a customer, is deliberately partnering closely with carriers that have certified operators to cross the US-Mexico border, as well as investing in more planning tools that allow it to gain more visibility and increase the predictability of the freight.

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Feregrino concurred with this sentiment of strengthening relationships with trusted carriers that specialise in cross border operations to limit the impact of driver shortages on freight movement. He added that pre-clear driver pools is another "very important" means of mitigating the impact of this issue. "We've got to build a dedicated pool of pre-clear bilingual drivers, experienced in those US-Mexico routes," he said.

Incentive programmes aimed at improving the retention of drivers was another strategy Feregrino pointed towards as key to addressing challenges around driver shortages. "You have to offer competitive compensations and incentives to retain those cross-border, bilingual, qualified and certified drivers," he said.

Sustaita agreed, explaining that D-Troy Logistics has taken a 360-degree approach it refers to as "the circle of wellness" in which it strives to go beyond a basic relationship with drivers and ensure they feel engaged and part of a team. He noted that part of this is working with its customers to cut waiting times at the border and make the job easier for drivers. This, he said, is "a win-win situation for all stakeholders". 

Port congestion

Mexico's ports have experienced higher-than-average volumes this year, partly driven by exporters from Asia rushing to get stock into Mexico before additional tariffs come into effect in 2026, with data from Mexico’s Ministry of the Navy (Semar) showing that the National Port System registered almost 6.3 million TEUs from January to August this year – a 1.4% increase compared to the same period in 2024.

As such, there has been concern over congestion at ports in Mexico, further exacerbated by inadequate infrastructure to cope with increased volumes. "We have seen the for the last decade, [a] lack of investment in ports [and] in infrastructure, so that is causing some of the delays in the ports and the congestion," explained Lorenzini.

Feregrino noted that, from his experiences, it's not just the big ports that are "super busy"; he pointed out that as well as large ports like Manzanillo, he's seen delays at smaller ports like Ensenada. He recommended an approach that prioritises preparation over fear, taking action such as mapping local rules, yard hours and key port contacts, then using that information to create a plan.

Sustaita emphasised the merit of this kind of approach, but noted that it's important to avoid cost impacts. "It's a balance between those types of solutions but not going up in terms of cost, so it's a pretty interesting challenge " he said.