Mexican truck capacity concern ticks up over tractor trailer rule

Mexican truck capacity concern ticks up over tractor trailer rule

A driver shortage combined with a new regulation could lead to higher trucking rates in Mexico. Photo credit: Shutterstock.com.

A Mexican government mandate intended to reduce accidents by requiring that all double tractor trailers meet new certification requirements is sparking shipper fears of higher rates. The rule will reduce available truck capacity and may spur some shippers to move more cargo by more expensive single-trailer trucks or convert cargo to intermodal rail.

Police at the start of the month began more vigorously enforcing the mandate, which took effect on June 26, and truckers say that some drivers who have not been able to meet the deadline are staying off the road rather than face penalties if they are caught. Under the regulations, truck owners must submit paperwork to the government that demonstrates tractor trailers used in a double-trailer formation are fitted with certain features, including anti-lock brakes, a global positioning satellite system, a regulator that restricts the vehicles to 80 kilometers an hour (about 50 mph) and low emission levels.

The demand for certification comes as the trucking industry already faces what two truckers described as a capacity shortage, mainly due to a difficulty in finding drivers. The number of trucks carrying cargo grew by about 6 percent in 2017, government figures show.

Although the certification is free, truckers say the cost of upgrading older trucks to meet its requirements can be prohibitively expensive in a low-wage country such as Mexico. That hit hard on owner-operators — which account for about one in four trucks in Mexico, and small companies, which also control about a quarter of the market.

“It’s a big problem,” said the director of sales at one of Mexico’s largest trucking companies, who said the trucking industry doesn’t have the capacity to cope with the loss of a significant volume of double trailers from the market.

The government has resisted suggestions that it extend the deadline to enable truckers to fulfill the law’s requirements, and truckers say part of the problem is that the government’s five document processing centers have been slow to complete the process. Truckers caught driving a double trailer without the required certification can find the truck removed from the road, and face penalties of more than $1,000.

The law took effect ahead of the Mexican government’s new regulation limiting driver time behind the wheel that begins in late August. Truck drivers are required to take a 30-minute break every five hours, and the law limits them to driving no more than 14 hours, after which they must take an eight-hour break. Drivers also must keep a logbook documenting their driving hours.

While the Secretariat of Communication and Transportation, which oversees the transportation industry in Mexico, says the law will reduce accidents and improve highway safety, trucking groups say that Mexico doesn’t have the rest areas to enable truckers to comply with the law.

A few days after the double-truck certification requirements took effect, truckers outside the Port of Lazaro Cardenas and in the State of Sinaloa stopped work for two days to protest the certification requirement, said Abelardo Lozano Herrera, head of the Association of Federal Cargo Transporters of Lazaro Cardenas. About 1,000 truckers took part in the port action, and some drivers started using only a single trailer to avoid getting stopped, he said.

“We are entering the high season. The clients want their goods as fast as possible,” he said, adding that the shortage of certified trailers was restricting the ability of the trucking sector to meet shippers needs, and was pushing up the cost of moving goods.

Double trailers, due to their ability to carry larger cargo volumes, have proven competitive against rail, which is cheaper but slower. Railroad leaders say trains in Mexico become competitive with trucks on trips longer than 400 kilometers. The use of twins can improve truck efficiency, in some cases making the cost of moving cargo 25 percent cheaper than the cost of moving it with a regular truck.

Eric Gantier, country manager for DHL Global Forwarding, Mexico, said the company, which uses double trailers to carry dry boxes, said in late June that the company was watching the impact of the mandate closely.

“We are also monitoring how the government will apply these new regulations,” he said. “In particular, keeping a close eye on the requirements of shippers to get permission from the government to use these types of vehicles to transport cargo on the roads that connect to their plants or shipping centers to the main highways.”

Contact Hugh R. Morley at hugh.morley@ihsmarkit.com and follow him on Twitter: @HughRMorley1.