North American Cross Border

Shippers face cross-border hurdles

C.H. Robinson cross border freight market update

U.S.–Mexico

Newly announced tariffs

On February 1, 2025, the U.S. administration announced a broad 25% tariff for all goods coming from Mexico. On February 3, 2025, it was announced these tariffs would be on hold for a one-month period while further negotiations could take place. If a deal is struck during this period, it is possible this tariff may be removed or reduced. If not, a 25% increase in tariffs would be very impactful as Mexico is the largest importer into the United States.

Mexico’s investment in manufacturing

President Claudia Sheinbaum's "Plan México" is a strategy aimed at enhancing Mexico’s position in global supply chains by attracting $277 billion in investments and promoting manufacturing relocation to Mexico. The plan includes incentives such as $30 billion pesos in tax benefits and aims to increase domestic production by 15% in industries like automotive, aerospace, and semiconductors. This strategic move aims to position Mexico among the world's top 10 economies by 2030.

Mexican exports grew 4.1% in 2024, with manufacturing continuing to dominate the trade landscape at 92.1% of total exports. Five northern states (Chihuahua, Coahuila, Nuevo León, Baja California, and Tamaulipas) account for 55% of the country's exports, strongly influencing cross-border freight activity in these regions.

The automotive industry remains a cornerstone of Mexico’s economy achieving remarkable growth, producing nearly four million vehicles in 2024—a historic record—and a 5.4% export increase compared to 2023. With 80% of exports destined for the U.S. market, this industry remains a crucial driver of cross-border freight demand.

Carrier challenges in Mexico

Carriers in Mexico continue to face persistent challenges. Truck driver shortages, difficulty recruiting, and rising cargo theft (up 16% in 2024) are among the top concerning issues. In addition, recent toll increases on major routes, including México-Cuernavaca, México-Querétaro, and México-Puebla, are raising the cost to operate.

Current market conditions show equipment availability for northbound freight is high, suggesting potential imbalances in trade flows that could impact carrier profitability, but provide opportunities for shippers.

While December 2024 showed typical seasonal declines in trade volumes (-2.3%), the expanding manufacturing base and government incentives for nearshoring suggest strong potential for freight demand growth. However, security concerns and infrastructure challenges remain significant obstacles for carriers operating in the market.

Reach out to your C.H. Robinson representative to discuss how to create a flexible strategy and manage the risk of your cross-border Mexico freight. C.H. Robinson has been operating in Mexico for 35 years, our unrivaled scale and unmatched expertise are your advantage.

U.S.–Canada

Newly announced tariffs

On February 1, 2025, the U.S. administration announced a broad 25% tariff for all goods coming from Canada, with an exception for commodities for energy or energy resources, which will be subject to a 10% tariff.

Canada responded swiftly with 25% retaliatory tariffs for $30 billion worth of goods, announced February 3, 2025. Later that day it was announced that these tariffs would be on hold for a one-month period while further negotiations could take place. If a deal is struck during this period, it is possible this tariff may be removed or reduced. These tariffs would certainly be impactful, as Canada is the U.S.’s second largest trade partner.

The potential impact of a 25% tariff on Canada exports to the United States, as mentioned by the current U.S. administration and Canada’s retaliatory response, is an ongoing challenge for cross-border shippers.

Market capacity

For several months leading up to the Christmas holiday, the freight market favored northbound loads into Canada, which were highly sought after by carriers. After the holidays and as shippers and receivers in the United States resumed operations and pushed out holiday backlogs, the market shifted, making southbound loads more desirable while northbound freight quickly piled up with limited capacity. Exacerbating the situation is the effect of the recent snowstorms across several parts of the United States.

Shrinking carrier capacity

Reduced shipping capacity, caused by normal carrier attrition during the soft market, has affected cross-border freight in both directions. Contributing to this recent trend is the considerable number of truck drivers taking vacations at this time of year to avoid winter weather. In fact, many South Asian drivers, who comprise nearly one-fifth of the Canadian truck driver population, return home during the winter. This driver shortage, combined with the already shrinking carrier capacity, has led to higher prices as shippers scramble to find available transport.

Railway labor strike averted

The Canadian Pacific Kansas City (CPKC) railway issued a customer advisory on January 28, 2025, announcing they reached a tentative agreement with the teamsters Canada Rail Conference Maintenance of Way Employees Division (TCRC-MWED) that would prevent a strike from occurring.

A similar strike occurred in August 2024, which resulted in freight hikes for Intra-Canada moves and a disruption to supply chains inbound and outbound, so the agreement is welcome news to the industry. 

*This information is built on market data from public sources and C.H. Robinson’s information advantage—based on our experience, data, and scale. Use these insights to stay informed, make decisions designed to mitigate your risk, and avoid disruptions to your supply chain.

To deliver our market updates to our global audiences in the timeliest manner possible, we rely on machine translations to translate these updates from English.