Importing From Mexico to the US
No matter the industry, importing can be a valuable step to help your business grow and expand. Whether you currently import products or are looking to begin, there are many items to consider. Establishing your supplier, finding a carrier and navigating customs all play into your company’s logistics. However, many of your logistics will revolve around the country you import from. Accordingly, making the best decision will impact your business tremendously.
China has long been one of the United States’ largest supplier of imported goods. But for many U.S. companies, Mexico has become an optimal choice for imports. According to the United States Trade Representative, the U.S. imported $371.9 billion from Mexico in 2018. This total ranked Mexico as the United State’s second-largest goods importer in 2018, but the recent trade war between the U.S. and China has been pushing Mexican imports even higher.
With Mexican imports on the rise, your company may be able to find a profitable import solution close to home. Take a look at some of these benefits to determine if importing goods from Mexico to the U.S. might be right for your business.
Why Do so Many Businesses Import From Mexico to the US?
In 1994, the United States entered a trade and investment relationship with Canada and Mexico known as the North American Free Trade Agreement (NAFTA). The parties involved with NAFTA enjoy fewer trade barriers, which makes importing between these countries advantageous.
The United States initiated a renegotiation of NAFTA in 2017. These negotiations eventually led to the new United States-Mexico-Canada Agreement (USMCA) that was signed by all three countries on Nov. 30, 2018. Though all three countries have agreed to USMCA, it will not take effect until it is ratified in each country.
The changes from NAFTA to USMCA are subtle, but a recent International Trade Commission report predicts USMCA will promote a 3.8% increase in imports between the U.S. and Mexico. For now, businesses benefit from importing from Mexico under NAFTA. In the future, these benefits may expand under USMCA. Whatever the case, businesses can capitalize on this opportune time to import from Mexico.
Based on trade agreements and other logistical concerns, importing goods from Mexico offers several business advantages:
- Affordability: When you import from Mexico, you have the ability to pick the transportation method that works best for you. Whether you need trucking or air freight, both options are readily available. This offers increased budget flexibility compared to importing from countries that require ocean or air freight only. In addition, NAFTA and USMCA grant some goods a duty-free or reduced-tariff status. This can lower your overall importing costs compared to other countries.
- Proximity: Take one look at a world map and you’ll see that Mexico is much closer to the U.S. than Asia or Europe. This proximity is an asset when it comes to shipping costs. Products imported from Asia will travel a greater number of miles, which may rack up increased shipping costs and time. Importing from Mexico offers a closer solution that may pose a lower-cost and quick shipping time.
- Logistics: In general, importing involves detailed logistics. Importing from Mexico may offer a more convenient flow. For example, if you need to travel to your supplier’s facilities, a flight can have you there in a few hours. The similar time zones can also simplify coordination efforts.
Though there are many benefits to importing from Mexico, working out the details can be challenging for business owners. This is where Universal Cargo steps in.
Mexico to US Services
When importing, you need knowledge and experience to help address detailed trade laws and processes. At Universal Cargo, that’s our specialty. We strive to be your one-stop shop for international shipping and logistic needs. Universal Cargo can partner with your business along every step of the logistics cycle to keep you informed and effective.
Some of our Mexico-to-U.S. services include:
- Finding trucking companies: Finding a trucking company to haul freight long distances can require detailed coordination and connections. Universal Cargo has trucking partners all across North America to help you move your freight from Mexico to the U.S. We’ll handle all the logistics directly with the carrier, so you won’t have to worry about any paperwork.
- Determining LTL or FTL: When importing and shipping via trucks, you’ll either use a less-than-truckload (LTL) or a full truckload (FTL) carrier. LTL shipments are priced according to the weight of the freight, whereas FTL shipments are priced per mile. Universal Cargo can help you figure out which method is most economical when transporting your goods from Mexico.
- Product sourcing: Establishing a supplier in Mexico from whom to import can be difficult without connections. Some businesses have to invest additional capital to partner with sourcing organizations, but that isn’t necessary when you work with Universal Cargo. We can help you find trustworthy business partners in Mexico and maintain a healthy supplier relationship in addition to handling logistical concerns.
- Warehousing: Depending on your business, you may need to store your imported goods in a warehouse. Universal Cargo is equipped to store and ship your goods at a moment’s notice. Our warehousing service is one more way you can streamline your supply chain for smooth operations.
These are just some of the ways Universal Cargo can assist with your Mexico to U.S. importing. If you aren’t sure what your business needs to improve your supply chain, submit a form for more information and assistance.
Is Mexico a Destination to Consider for Importing to the US?
In short, yes. The ongoing U.S. and China trade war has opened doors for increased imports from Mexico. A study conducted by the United Nations Conference on Trade and Development (UNCTAD) cites that Mexico has increased its U.S. exports by $3.5 billion as a result of the trade war.
Mexico’s gain during the trade war has been influenced by tariffs and foreign direct investments (FDIs). Put simply, the U.S.-imposed tariffs on China make it more expensive for U.S. businesses to import Chinese goods. Both American and Chinese business owners want to avoid tariffs, and they have both turned to Mexico.
Under NAFTA, business owners can import many goods duty-free. China has capitalized on this statute with FDIs — that is, Chinese-owned companies operating in Mexico. Between 2014 to 2016, China invested over $4 billion in more than 40 FDI deals with Mexico. These businesses allow China to export goods duty-free and without the China-to-U.S. tariffs.
In essence, the trade war has prompted the flow of goods from China to Mexico to the U.S. This has and continues to provide opportunities for affordable and reliable imports from Mexico to the U.S.
If you’re importing from Mexico, Universal Cargo has the connections and experience to assist. Whether you need Mexico-to-U.S. trucking or help with customs, we can help you establish and refine your logistics cycle.
In addition to our comprehensive services, Universal Cargo has more than 30 years of experience in the industry. Our dedicated team is ready to provide prompt, helpful and friendly service in whatever area you need. All of our services feature reliable customer service, detailed tracking information and a partnership with an operations account manager.
To request a rate or find out how Universal Cargo can serve your cargo needs, contact us today!