The challenges inherent to running a successful motor carrier year after year in Mexico, the nation that boasts the world’s 15th largest economy are not all that different from those dealt with north of the border. In many cases, the differences are a matter of degree. On the other hand, there are some distinctions that are starkly different.
From an article that appeared in truckinginfo.com, I’m going to share some highlights of the article that showcased a roundtable discussion with some of the top motor carrier executives in Mexico.
Here are the three fleet speakers and a brief description of how they described their operations:
- Alex Thiessen, director of logistics solutions for FEMSA Logística, based in Monterrey, NL. FEMSA Logística is a subsidiary of FEMSA, the largest Coca-Cola bottler worldwide and the second-largest shareholder of Heineken Beer. As a multinational company, the logistics firm offers “integral logistic solutions” in Mexico, Panama, Brazil,Columbia, Costa Rica and Nicaragua. Its extensive roster of brand-name clients includes GlaxoSmithKline, Johnson & Johnson, Fiat, Nestlé, Purina and Whirlpool. Employing over12,000. FEMSA Logística is ranked as the largest freight-logistics company by sales in Mexico.
- Ramón Medrano, director general of Frio Express, based in Aguascalientes, AG. The company specializes in reefer freight. Launched in 1980 with two trucks, its all-Freightliner fleet now run some 400 tractors on 1300 routes. It hauls domestic and cross-border freight. Maintenance is handled in-house and GPS helps ensure guaranteed delivery. Per Frio, the company owes its success to its strategic location, sophisticated operations, experience and to “positioning itself as one of the best.”
- Miguel Gómez, president of Fletes México, based in Juárez, CH. Started as a family business in 1988, the general-freight hauler now fields a fleet of 750 trucks, all Freightliners, distinguishing it as one of the largest fleets in Mexico. The company’s top customers include Chrysler, Colgate, Daimler and Walmart. According to Fletes México, its stated goal is to provide “a top-class freight transportation service.”
During the Q&A, the panelists commented on everything from driver pay to why they don’t seek operating authority north of the border.
Frio’s Medrano touched on how cultural traditions can impact doing business in Mexico, even for Mexicans. “I’ve been working at this for 30 years and it is painful for us to have to lose a customer who is not operating efficiently. We get very mad when a driver has to wait a whole day.”
On the other hand, he said the carrier finds that “efficiency is contagious— we want to work with those customers and they want to work with us.”
Medrano pointed out that Mexico is “very far from where we should be with infrastructure.” FEMSA’s Thiessen agreed that is a key issue going forward, for the industry and the country.
As for all those older trucks mentioned frequently, the panelists concurred that they have to go as drive up accidents and maintenance costs, not to mention blackening the industry’s image.
“We have to improve the age of the fleet to be safer and more efficient,” said Thiessen. He said to do that would require “FEMSA and others” to push OEMs to establish a secondary truck market in Mexico. “A single truck operator could buy a newer truck if more were available.” Frio’s Medrano said there is no question that “maintenance costs increase exponentially with aging trucks.”
Then there’s the matter of government regulation. In the panelists’ view, there is such a thing as too little of it being imposed. FEMSA’s Thiessen called having no hours-of-service rules “difficult” because his company wants to compete safely. “Lots of truck drivers are driving more than the hours they should, which makes them more competitive,” he said, adding that “the playing field isn’t level as it is in the U.S.”
Fletes México’s Gómez noted that Mexico “does not have an agency that tells us what a driver’s record is. Each time we hire a driver, we have to call every company” he worked for.
None of the panelists is planning to seek U.S. operating authority. “We’ve done trailer interchange for the last 20 years and are very happy with it,” said Gómez. He added that not having cabotage rights in the U.S. takes all the interest out of [cross-order trucking] for me.”
While driver pay is much lower than in the U.S., FEMSA’s Thiessen pointed out that being a trucker in Mexico is “still a high-paying job, but it’s still hard to find them.” Frio’s Medrano said that “drivers make less [here], but they spend less. Our drivers are able to send their children to college.”
The panelists blamed the growing driver shortage on several factors, including a dearth of driver-training schools and, yes, drivers jumping ship for the higher pay offered by U.S. carriers.
There’s another cause similar to what’s been happening demographically in the U.S. As the growth in manufacturing continues to grow Mexico’s middle class, young adults are finding more career opportunities to explore.
“The driving profession was highly valued at one time,” pointed out Fletes México’s Gómez. “Today, it has taken on a bad image. Families do not want their children to become drivers now. The old school of fathers and uncles teaching sons and nephews how to drive a truck is over. Now, we must teach them from the beginning. And even if it is a well-paying job, it no longer has the right image to attract new drivers.”
It’s an interesting article that you can read in its entirety, H E R E!
This post is part of the thread: Mexico Trucking – an ongoing story on this site. View the thread timeline for more context on this post.