{"id":8439,"date":"2025-02-28T16:19:24","date_gmt":"2025-02-28T16:19:24","guid":{"rendered":"https:\/\/apldevnew.wpenginepowered.com\/?p=8439"},"modified":"2025-02-28T18:27:20","modified_gmt":"2025-02-28T18:27:20","slug":"cross-border-solutions-supply-chain-resiliency-with-added-value","status":"publish","type":"post","link":"https:\/\/www.apllogistics.com\/2025\/02\/cross-border-solutions-supply-chain-resiliency-with-added-value","title":{"rendered":"Cross-Border Solutions: Supply Chain Resiliency with Added Value"},"content":{"rendered":"

with Fabio Duque, APL Logistics Chief Operations and Commercial Officer, Americas and EMEA<\/em><\/p>\n

Businesses are constantly being challenged to look within their supply chains to optimize the way they operate, save money, step up efficiency, and reduce their carbon footprints. In recent years, global manufacturing has seen the emergence of the China+1 strategy, a plan that aims to diversify manufacturing and logistics operations outside China\u2019s borders to mitigate risks and realize opportunities.<\/p>\n

Nearshoring Lens on Mexico<\/strong><\/h3>\n

As United States-based companies address rising costs, geopolitical tensions, and supply chain disruptions, \u201cnearshoring\u201d in Mexico is picking up considerable momentum as the favored China+1 (or even China +2) strategy.<\/p>\n

When considering nearshoring strategies against further offshore locations such as Asia, Mexico\u2019s proximity to the United States allows for faster and less expensive transit times, improved supply chain agility, more affordable labor, and easier access to a greater North American market, just to name a few advantages. When U.S. companies can save 20-30 days of transit time by nearshoring, it translates to less capital expenditure across the supply chain, making inventories easier and more cost-effective to control while adding the flexibility needed to respond quickly to changing consumer demands.<\/p>\n

Long before the term \u201cChina + 1\u201d was even coined, APL Logistics was serving its automotive customers with nearshoring solutions for just-in-time parts in North America for nearly 30 years, explained APL Logistics\u2019 Chief Operations and Commercial Office, Americas and EMEA, Fabio Duque. By 2009, APL Logistics formalized its “OceanGuaranteed” service, linking Asian origin ports to major North American markets, including all major metropolitan markets in Mexico, guaranteeing customers oceanic transit times and priority off- and onloading.<\/p>\n

Today, APL Logistics is nearshoring 120,000 loads per year within North America. Duque cited myriad factors that led to Mexico\u2019s nearshoring boom, and it\u2019s a boom that he says shows no signs of slowing.<\/p>\n

“This nearshoring transformation will probably only continue to accelerate,\u201d he said. \u201cAt APL Logistics, we work very closely with our customers to follow sourcing opportunities and new trends in the world, and that is why APL Logistics was created, starting in Asia: To help our customers organize their cargo, consolidate shipments, and improve systems.\u201d<\/p>\n

As times change, sources change, Duque added. Starting about 15 years ago, APL Logistics observed outsourcing expanded outside of China and into places such as India, Pakistan, Bangladesh and across Southeast Asia.<\/p>\n

About eight years ago, U.S.-imposed tariffs on goods from China, and more recently, supply chain disruptions in the wake of the COVID pandemic helped lead to a fortuitous nearshoring boom in Mexico. Consider also that for most of the past 60 years, Mexico and the U.S. have worked together on job creation, technology-sharing, attracting investment for Mexico, and helping U.S. industries compete with those in Asia and Europe through access to lower-cost labor.<\/p>\n

Duque noted that much of Mexico\u2019s explosive foreign direct investment in the last two years is increasingly from China, which has set up more than 1,600 legal entities \u2013 namely manufacturing plants in Mexico to stay competitive with the changing trade landscape. Illustrating the boom, before COVID, about 11,000 trucks crossed the massive Port of Laredo every day; today that number is over 18,000 trucks, Duque added. \u201cAnd that\u2019s just trucks, not even factoring what comes by rail,\u201d he said.<\/p>\n

Shifting consumer behavior is another driver, Duque said. Social media and the influencer culture have proven the power of a post<\/em> to sell 100,000 t-shirts overnight, creating a get-it-fast urgency that requires retailers to reduce lead time by getting the product closer to their markets.<\/p>\n

\u201cNearshoring reduces lead time, gets the product closer, and allows business to react quickly to consumer demand and these will be very key in the strategies for companies,\u201d Duque said. \u201cOnce you have the manufacturing investment in place in Mexico, you’re going to increase your capacity to work 24\/7, and you\u2019re going to add more resources.\u201d<\/p>\n

APL Logistics\u2019 Cross-Border Solutions: A Value-Creator<\/strong><\/h3>\n

APL Logistics\u2019 cross-border solutions deliver proven services and strategies designed to facilitate the smooth movement of goods from trucking, warehousing, compliance and customs clearance, and specialized transportation options.<\/p>\n

About 25 years ago, the company helped pioneer innovations in rail transport using double-stacked containers for its automotive customers. This increased capacity for just-in-time parts to seamlessly flow throughout all three countries in North America to keep production moving for some of America\u2019s best known auto manufacturers.<\/p>\n

\u201cOperational excellence is the focus; part of our control tower order management solution focused on vehicle parts moving, and we\u2019re very strong on this, with around 100 people between the two countries (Mexico and the U.S.),\u201d Duque said. \u201cThe focus is disciplined: Everyday we\u2019re watching all the traffic, orders, staying upfront, and providing stats for customers to keep planning and better execute.\u201d<\/p>\n

APL Logistics\u2019 professionals serve customers with tailored order management solutions designed to maximize revenues and optimize their efficiency and adaptability. The combination of its technology\u2019s advanced machine learning and industry-leading expertise in advanced order-planning and control deliver efficient, cost-effective, and carbon-conscious trade and transportation for its customers. It implemented the same LSS+ technology it uses in Asia to its cross-border solutions serving North America for a uniform customer experience, one that gives full visibility across the entire supply chain. Duque notes this is a difference-maker that helps customers keep inventory moving and to reduce a lot of cost as cargo travels through Mexico.<\/p>\n

Although it may have been APL Logistics automotive customers that helped it innovate these cross-border solutions, this service extends to all industries, from consumer products to chemical transport.<\/p>\n

More Modes of Transport in Nearshoring: Strength in Flexibility <\/strong><\/h3>\n

Duque also highlighted that nearshoring adds flexibility for companies in choosing their mode of transport. Each has its advantages and downsides, and the choice is largely dependent on customer priorities.<\/p>\n

\u201cAnother benefit of nearshoring is getting a choice in how to move cargo: You can go by ocean, by road, or intermodal (such as rail to truck),\u201d Duque said, noting APL Logistics neutrally seeks out the best solutions and partners for as seamless and frictionless an interface as possible. \u201cThe name of the game is to reduce lead time and inefficiencies.\u201d<\/p>\n

Mexico-U.S. cross-border trucking remains the full-speed solution when time is of the essence. Duque observes there is opportunity in the coming years for the Mexican government to improve trucking bottlenecks at the border crossing due to lading reviews and stamping paperwork, and to spur the labor market for more Mexican truck drivers. Truck cargo transport also can require extra security to avert theft, he notes.<\/p>\n

Rail transport offers a more seamless crossing between borders, but it still adds between three and five more days of total transit time. He noted this mode offers higher levels of security because once containers are loaded on rail in Mexico, they are locked during the journey. Rail is also a costlier choice for the customer, but it\u2019s a mode Duque said offers significant conservation benefits for customers committed to reducing their carbon footprint.<\/p>\n

Environmental sustainability as a corporate initiative isn\u2019t one Duque sees going away anytime soon, no matter which administration is leading the United States. Green initiatives are a global concern–as observed in increasingly catastrophic weather events–and global companies are responding conscientiously. Although there is a robust inter-Mexico network of EV trucking, U.S. companies still look to rail as the mode it can utilize to most impactfully cut emissions. APL Logistics helps its customers identify sustainability solutions that align with each customer\u2019s long-term goals.<\/p>\n

Duque reflects that with the introduction of APL Logistics\u2019 \u201cOceanGuaranteed\u201d program in 2009, transport by sea become a welcome alternative for companies looking to cut Transpacific emissions from its cargo shipped by air, even if it added transit time. Customers want options, and if it pencils out for both the bottom line and in achieving sustainability goals, they choose accordingly.<\/p>\n

\u201cIn Mexico, there is enormous opportunity to increase the rail system and infrastructure to support this tremendous nearshoring growth,\u201d Duque said. \u201cWe have U.S. customers with ambitious sustainability goals, some of which want to increase their rail transport from 20% to 50%, and to do that, more investment in Mexico\u2019s rail system is needed.\u201d<\/p>\n

China + 1 Cross-Border Opportunities Abound<\/strong><\/h3>\n

Mexico alone cannot shoulder all the U.S. manufacturing and production demands outside of China, Duque noted. Opportunities to develop multinational cross-border supply chains abound.<\/p>\n

\u201cThe U.S. will need to have established partners in Southeast Asia,\u201d Duque said. “We see big growth in Vietnam because they are close to China, and by being close to China, you can more readily source raw materials.\u201d<\/p>\n

Across these emerging production hubs, the need to invest in the infrastructure to be able to support this this demand is clear. It\u2019s something that Duque notes China has been doing internationally for over 20 years, creating new cities, new ports, and building more capacity for exportation.<\/p>\n

No matter where in the world companies choose to implement their China + 1 strategy, Duque asserts that APL Logistics is advantageously positioned to help its customers avoid and respond to supply chain disruption.<\/p>\n

“If you don’t have very good people on the operations side and the most advanced technology, you cannot react quickly; we strive to be the premier order management provider in the world by offering both,\u201d Duque said. \u201cWe have the people, global footprint, and flexibility to solve our customers\u2019 most complex problems.”<\/p>\n

With its global expertise and network spanning over 120 service locations across 60 countries, APL Logistics is committed to empowering supply chains for success. Cross-border solutions leverage the experience of our committed professionals and cutting-edge order management technology to equip businesses with the tools, information, and supply chain expertise they need to navigate complexity and drive sustainable growth.<\/em><\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

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