A year-long pilot program that would expand U.S. cross-border trucking operations with Mexico is receiving mixed reviews from the transportation industry.

 

The program, announced in February by the Department of Transportation (DOT), gives U.S. truckers the ability to make deliveries into Mexico, and grants a select group of Mexican trucking companies the authority to deliver goods beyond the current, limited commercial zones in place along the border.

The pilot aims to simplify current cross-border transport policy, which forces Mexican carriers to transfer goods to American trucks waiting at the border. The extra handoffs cause delays that waste money, drive up the cost of goods, and leave loaded cargo trucks idling inside U.S. borders, according to Transportation Secretary Mary Peters.

Several industry executives have spoken out in favor of the program. "The new trucking provisions will eliminate a cumbersome, outdated, and costly system of moving freight across the border and replace it with an efficient, transparent, and safe cross-border trucking process," said James P. Worthington, president, Con-way Freight-Southern, during testimony in March before the U.S. Senate.

Agreeing with Worthington is Rick Jordon, director, global logistics solutions group at procurement services provider ICG Commerce.

 

"This program will allow carriers to accommodate larger service areas; shippers will be able to leverage carriers that no longer have to coordinate between multiple providers; and consumers will feel the financial impact of more efficient supply chains," he says.

Other transportation pundits, as well as politicians and safety advocates, have voiced resistance to the cross-border pilot, fearing the program bears substantial security risks and grants too much freedom to Mexican carriers.

"It is impossible to know how many hours or days a driver has been behind the wheel of a truck in Mexico, without rest, prior to crossing the border and entering our highways. Anecdotal evidence suggests that working hours for truck drivers in Mexico go far beyond safe, reasonable limits," notes House Transportation and Infrastructure Committee Chairman James Oberstar (D-MN).

The DOT, however, argues that all Mexican trucking companies allowed to participate in the program will be required to possess insurance from a licensed U.S. firm and meet all U.S. safety standards.

 

In addition, Mexican drivers will be restricted to international pickups and deliveries, and will not be able to move goods from city to city within the United States, haul hazardous materials, or transport passengers.

Increased efforts to police Mexican trucks delivering cross-border freight should help quell security concerns and deliver the message to Mexican carriers that non-complying drivers and vehicles will not be tolerated, says ICG's Jordon.

 

"This will help deter sub-standard providers from accepting loads and crossing borders," he explains.

The first Mexican trucks to be authorized under the program were slated to begin traveling beyond U.S. border areas once the initial safety and insurance inspections were complete.

 

U.S. carriers, on the other hand, are not scheduled to receive access to Mexican roads for six months, a point of contention that could delay the entire pilot.

 

At press time, the Bush administration, and Senate and Congress members were still wrangling over the issue.
 

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Supply chain professionals innovate every day to find solutions to a vast array of global logistics challenges. From shipping snafus to inventory concerns, companies continually look to their logisticians to devise new ways of perfecting supply chain capabilities.

 

But what about CEOs -- do they grasp the importance of innovation in solving global business problems?

If IBM's Global CEO Study is any indication, they do. Promoting innovation within their companies is high on CEOs' agendas, finds the annual study, based on in-depth, consultative interviews with 765 global CEOs, business executives, and public-sector leaders.

Two-thirds of CEOs surveyed expect radical change within their organizations over the next two years, so they are particularly focused on making innovative adjustments to operations processes, business models, and products, services, and markets to keep up.

Logisticians will not be surprised that many CEOs rank operational innovation at the top of their priority lists, blaming "high-cost, slow, inefficient, and antiquated" operations procedures for poor company performance.

 

CEOs also understand that implementing operations innovations can lead to competitive and revenue-generating advantages, shows the survey.

Additional CEO perspectives from the report include:

External collaboration is indispensable. CEOs stress the overwhelming importance of collaborating with global business partners and customers to develop innovations, and admit that their organizations do not collaborate enough.

Technology can ignite innovation. Combining technology with business and market insights can be a catalyst for global innovation, CEOs say.

Innovation requires orchestration from the top. CEOs accept responsibility for fostering innovation. They believe creating a team-based environment and rewarding individual innovators can help promote an innovative company culture.