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Report says Teamsters file U.S.-Mexico cross-border trucking lawsuit

By Jeff Berman, Group News Editor
September 06, 2011

Following the July announcement that the United States and Mexico had reached a cross-border trucking agreement, a Wall Street Journal report indicated that the Teamsters union has filed a lawsuit against the White House that intends to block the deal.

In July, U.S. Department of Transportation officials said that U.S. Transportation Secretary Ray LaHood and Mexico’s Secretaría de Comunicaciones y Transportes Dionisio Arturo Pèrez-Jàcome Friscione signed documents which will resolve the long-standing conflicts over cross-border trucking between the countries.

In June, Bloomberg reported that Mexican Economy Minister Bruno Ferrari said his country would soon sign a formal agreement to end a cross-border trucking dispute with the U.S, setting the stage for the Latin American country to remove punitive tariffs.
In 2009, the pilot program for cross-border trucking was eliminated as part of the White House’s $410 billion Omnibus Appropriations Act, H.R. 4105. Even through this program-killing measure was approved, that Obama administration said it would work to create a new cross-border, long distance trucking program between the U.S. and Mexico. Soon after the program was eliminated, the Mexican government said it would place tariffs on roughly 90 American agricultural and manufactured exports as payback for the U.S. decision to shutter the program.

These tariffs amount to $2.4 billion of American goods, ranging from fruit juices to pet food to deodorant, among others, ranging from 10 percent to 45 percent, with affected products coming from 40 states.

The WSJ report stated that the Teamsters’ suit was filed in the U.S. Court of Appeals for the Ninth Circuit in San Francisco by the Teamsters and Public Citizen against the DOT and the Federal Motor Carrier Safety Administration.

According to the report, the complaint alleges that the “pilot program sets standards that aren’t stringent enough for Mexican trucks and drivers,” adding that the cross-border trucking program, which is expected to kick off with a pilot program in the next 30-to-60 days, waives a law requiring trucks to display proof of meeting federal safety standards. 

And it added that the Teamsters maintain the program is “faulty,” because it includes standards that are impossible for Mexico to meet, including providing comparable access to U.S. trucks, which is required, because ultra-low-sulfur diesel fuel is not widely enough available in Mexico.

The July agreement between the two countries is focused on a safety-first program, coupled with lifting the tariffs, which DOT said will in turn provide opportunities to increase Mexico-bound U.S. exports and create job opportunities. And it will also ensure that Mexico will suspend 50 percent of the retaliatory tariffs within ten days and also suspend the remainder of the tariffs within five days of the first Mexican trucking company receiving its U.S. operating authority. Tariffs ranging from five to 25 percent on various U.S. agricultural and industrial products would be halved immediately and disappear within months.

Other components of the deal include:
-Mexican trucks being required to comply with all Federal Motor Carrier Safety Administration (FMCSA) safety standards and trucks must have electronic monitoring systems to track hours-of-service compliance;
-the U.S. DOT reviewing the complete driver record of each driver and require drug testing samples to be analyzed in Department of Health and Human Services-certified laboratories located in the U.S.;
-DOT will require drivers to undergo an assessment of their ability to understand the English language and U.S. traffic signs; and
-the agreement ensures that Mexico will provide reciprocal authority for U.S. carriers to engage in cross-border long-haul operations into that country.

In January, LaHood shared “an initial concept document” with members of Congress for a long-haul cross-border Mexican trucking program. This document prioritized safety while satisfying the United States’ international obligations.

LaHood said at the SMC3 Winter Conference in January it was likely there will be a final agreement by mid-year for the cross-border trucking program, adding that there is pent-up demand from both Mexico and the U.S. to get a final plan in place. He added that this new plan was done without input from the Mexican government and was based largely on feedback from Congress and industry stakeholders.

Wayne Johnson, manager, carrier relations at Owens Corning, told LM that from a shipper’s perspective that this agreement is a good thing and there should not be too much initial pain from either side.

“I don’t think the agreement is going to change too much for shippers other than there are a few Mexican carriers who will try to come into the country as best they possibly can in certain parts,” said Johnson. “I think it will be a slow impact initially, but it will be a good impact for shippers, because it will bring more competition into the U.S. and reduce freight rates heading down into Mexico, as Mexican carriers move freight up here and also head back home. It is good for U.S. shippers and the U.S. economy and Mexican and U.S. carriers, too.”

About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


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Article Topics

News · Trucking · FMCSA · DOT · Teamsters · Mexico · Cross-border Trucking · All topics

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