UPS expands Preferred LCL service in Mexico

UPS recently announced it has expanded its UPS Preferred Less-Than-Container Load (LCL) expedited ocean freight service between Asia and three Mexico-based locales in Monterrey, Mexico City, and Guadalajara.

This service, said UPS, provides shippers with time-in-transit improvements that leverage its existing North American freight network.  UPS initially launched the UPS Preferred LCL Ocean Freight service in the fall of 2010 from Japan. In roughly two years, customer demand for this product has led to the expansion of Preferred LCL customers importing into the United States from 27 Asian ports and seven Western European ports to the U.S., Canada and now Mexico. UPS officials said that with this expansion it will have the most origins and destinations for expedited LCL service.

“UPS made enhancements to the Preferred LCL offering in order to meet customer demand mostly resulting from the growth of U.S. near-shoring in Mexico, as Mexico is quickly becoming a preferred near-shoring location for U.S.-based companies looking to manufacture and produce goods for the North American market. The cities of Monterrey, Guadalajara and Mexico City form the “triangle” where Mexico manufacturing for industrial, automotive and high tech industries are concentrated,” said Keith Andrey, vice president, UPS Ocean Freight Services, in an interview.

Andrey noted that Mexico continues to gain momentum and strengthen trade with Asia as ocean lane imports are forecasted by Seabury Group to grow at a CAGR of 12.1 percent through 2016, compared to 6.5 percent growth projection globally.

UPS began to evaluate the feasibility of adding these three destinations last year, shortly after the introduction of the UPS CrossBorder Connect service (a contractual service provided by UPS Supply Chain Solutions that provides an affordable alternative to conventional ground or air freight) in April of 2012, he said.

In terms of how freight moves through Preferred LCL, Andrey said that after reaching West Coast ports, Preferred LCL ocean shipments are moved through the UPS North American ground network utilized for air freight shipments. And in the case of Mexico, the ground shipments utilize the UPS CrossBorder Connect service, which integrates UPS’s brokerage capabilities to reduce customs delays associated with border regulations, inspections and lengthy paperwork.

The top shipper benefits of this expansion cited by Andrey include speed, pricing, and enhanced shipment visibility and reliability.

“The service can potentially cut a typical 3-to-4 week LCL ocean transit time by up to 20 percent (transit times vary based on origin, destination and commodity and are not guaranteed) and offers a cost savings of up to 60 percent versus standard UPS air freight,” he said.  “Additionally, UPS PLCL offers customers a level of shipment visibility beyond what is typically available for ocean shipments. Customers utilizing the UPS PLCL service can take advantage of the innovative visibility technologies used for UPS package shipments, ensuring they can better anticipate and control their inbound supply chain operations.”

The PLCL expansion to Mexico does not impact UPS’s current LCL service to and from Mexico, said Andrey, explaining that it continues to enable its customers to reach multiple countries from Mexico— and vice versa with regular LCL service with the convenient option of not having ship full containers through:
-offering 25 regular, direct LCL services from 15 countries to Mexico
-offering 20 regular, direct LCL services from Mexico to 14 countries; and
UPS PLCL provides between 19 and 33 percent faster transit times than existing LCL services