Borderlands Mexico: Carrier says transition to zero emissions critical to better air quality

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Borderlands is a weekly rundown of developments in the world of United States-Mexico cross-border trucking and trade. This week: Carrier says transition to zero emissions critical to better air quality; Texas waterway receives $357M loan to improve shipping channel; Sinoboom plans to build $150M factory in Guanajuato, Mexico; and Grupo Mexico Transportes set to acquire Mobile-based CG Railway.

Transitioning freight transport vehicles to green technology is currently expensive, but worth the effort.

That was the message from Juan Baez, director of San Diego-based trucking company Bali Express Services at the North American Development Bank’s 2024 summit in San Antonio.

Bali Express is a carrier with 357 diesel trucks, 32 natural gas trucks and three electric trucks.

“Each electric truck costs almost half a million, so the investment is huge,” Baez said. “Right now, the most challenging part of the electric trucks is the mile range, the amount of range is minimum. It could go from 120 miles up to 220 miles for a truck that costs half a million, which is very, very expensive, even though providing better air quality to the border communities is the most important thing right. We have to act. We have to start thinking, thinking about our future. We need to start thinking about the younger generations.”

NADBank’s annual summit included federal, state and municipal authorities, along with business organizations, academia, financial institutions, investors, project developers and experts, from both the U.S. and Mexico.

The theme of the 2024 summit held Thursday and Friday was “Innovation for Sustainability in the U.S-Mexico Border Region.”

The “Creative Proposals for Sustainable Mobility” panel discussion Thursday included Baez; as well as Jefferson Smith, president and CEO of EVerged; and Gilberto Ramirez, director of strategic planning and business development for Volvo Group Mexico.

Moderating the panel was Diana Avalos Morales, the general director of the Mexican Association of Electric Vehicles.

Avalos said decarbonizing the freight industry is something that the trucking sector must consider going forward.

“In the case of Mexico, for example, 25% of carbon emissions comes from cargo transport,” Avalos said. “That’s a lot and it keeps increasing.”

Juan Baez, director of Bali Express Services, from left, Jefferson Smith, president and CEO of EVerged, Gilberto Ramirez, head of strategic planning and business development for Volvo Group Mexico, and Diana Avalos Morales, general director of the Mexican Association of Electric Vehicles, take part in the “Creative Proposals in Sustainable Mobility” panel Thursday at the North American Development Bank’s 2024 summit in San Antonio. (Photo: NADBank)

In April, Bali Express Services made history using a Class 8 electric truck to haul freight between the U.S. and Mexico. It was the first-ever border crossing for a heavy-duty EV.

The Bali Express truck carried a load of goods into Mexico through the Otay Mesa Port of Entry, which connects Southern California to the Mexican city of Tijuana.

Baez said that even though the electric trucks cost more than a diesel truck, shippers don’t want to pay higher freight rates to cover the cost of operating them.

“Customers, they don’t want to pay more,” Baez said. “Probably next year, where we’re going to try to convince the people that this is the right direction.”

Baez said another challenge is that their business involves cross-border shipments, using multiple trucks.

“We pick up raw material cargo from the Port of Long Beach, then take it into Tijuana maquiladoras in order to assemble TVs, build trailers,” Baez said.

In order to make their deliveries across the border, Bali Express Services uses three different trucks.

“One electric vehicle in order to pull the container from the Long Beach terminal to our Long Beach yard, one compressed natural gas truck to bring the container down from Long Beach to San Diego, and another EV to do the border crossing,” Baez said. “You are using three different trucks, three different drivers, making the operation more expensive. We are spending more money for the same rates. That’s the struggle right now that we are dealing with.”

Carriers in Mexico also have to contend with California’s Advanced Clean Fleets rule, which could begin affecting trucks crossing the border into the U.S. in 2025. The mandate requires fleet owners to remove internal combustion engine vehicles at the end of their useful life as specified in the regulation.

The California mandate affects trucks crossing the border from Mexico into the U.S.

Ramirez said Volvo Group has a target of 2040 for 100% of commercial vehicles produced in its factories to be fossil free trucks and buses.

Sweden-based Volvo has 12 brands in 190 markets. The company has production facilities in 18 countries, producing cars, trucks, buses, construction equipment and marine and industrial engines.

Volvo Group Mexico currently has a factory in Mexico City that produces buses, as well as a factory in Shippensburg, Pennsylvania, that manufactures construction equipment.

On Aug. 23, Volvo Group Mexico announced it had selected the Mexican city of Monterrey as the site of a new heavy-duty truck factory. The company plans to invest $700 million there, according to a news release.

“Today, Volvo produces more than 300,000 vehicles, and the U.S. and Mexico are part of it,” Ramirez said. “By vehicles, I mean bus, trucks, but also construction machines … that can carry more than 100 tons, that will be electric, not fossil fuel. It is difficult, but this is the target, this is the challenge. To make it real, Volvo has established a clear roadmap and has invested in different technologies. The first technology is the battery electric vehicles.”

EVerged is a renewable energy solution integrator. The company is launching an electric vehicle charging platform in Austin, Texas, at the end of the year, Smith said.

“We’re bringing to market the world’s most stable, vertically integrated, cyber, secure charger platform,” Smith said. “We’re also a converged renewable energy provider.”

Smith said they aim to make electric vehicle chargers that attract a wide market.

“We look at the charger itself as not a charger, it’s a technology endpoint,” Smith said. “Think about a charger that can broadcast public safety and weather information, that can have a Smartphone link up to it and find site amenities around. We’re going to create a cult like following with our chargers. We want the charger experience to be that different.”

Texas waterway receives $357M loan to improve shipping channel

The Sabine Neches Navigation District in Beaumont, Texas, was recently approved for a $357 million loan to deepen its waterway, according to a news release.

The Texas Transportation Commission approved the loan from the state’s Ship Channel Improvement Revolving Fund on Aug. 22.

The funds will allow the navigation district to deepen the Sabine-Neches Waterway from 40 feet to 48 feet. The deeper channel will allow larger cargo ships to move through the area.

Products that move through the navigation district and the Port of Beaumont include petrochemicals, liquid bulk materials and military goods.

In addition to Sabine Neches Navigation District and the Port of Beaumont, the channel deepening project will benefit Port Arthur, the Sabine Pass Port Authority and the Orange County Navigation and Port District.

Sabine Neches Navigation District officials expect to see the first stage of the project completed by the end of 2026.

Sinoboom plans to build $150M factory in Guanajuato, Mexico

China-based manufacturer Sinoboom has begun construction of a factory in the central Mexican city of Silao, according to a news release.

The $150 million factory will total over 2-million-square feet and create 700 direct jobs. The facility is scheduled to begin operation in 2025, with its annual output reaching 20,000 units by 2028.

The facility will produce equipment such as slab and rough-terrain scissor lifts, articulating and telescopic boom lifts, telehandlers, vertical mast lifts and other products.

Sinoboom aims to strengthen the company’s presence in North America with the facility, officials said.

“This factory represents a crucial step in our mission to be a globally respected leader in the intelligent equipment manufacturing industry,” the company said in a statement.

Sinoboom was founded in 2008 and is headquartered in Changsha, China. The factory in Silao is the company’s first in North America.

Grupo Mexico Transportes set to acquire Mobile-based CG Railway

Grupo Mexico Transportes (GMXT) plans to acquire 60% of CG Railway after recently obtaining approval from the U.S. Surface Transportation Board.

The acquisition of Mobile, Alabama-based CG Railway gives GMXT control over a rail car-ferry operation linking ports in the U.S. and Mexico.

CG Railway operates a U.S. Class III freight railroad and two ferry ships, transporting up to 10,000 carloads of commodities annually across the Gulf of Mexico.

The rail ferry service offers weekly trips between the ports of Mobile and Coatzacoalcos. The service gives shippers access to 13 ports in the U.S. and Mexico through rail interchanges in both countries.

GMXT is a subsidiary of Grupo Mexico, the largest freight train company in Mexico. The conglomerate, which also includes rail company Ferromex, operates more than 6,835 miles of track that connects Mexican ports to major markets in the U.S. and Canada.

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