If you’re thinking about expanding your supply chain into shipping to and from Mexico, you’re not alone. Business between the U.S. and Mexico is booming. Currently, Mexico is the U.S.’s second largest trading partner, after China. The U.S. is Mexico’s largest trading partner, with 80 percent of Mexican exports going to the United States. Since the North American Free Trade Agreement Implementation Act (NAFTA) in 1994, U.S. exports to Mexico have risen 517 percent and Mexican exports to the US have grown a huge 797 percent!
Any goods to enter or leave Mexico is subject to a customs classifications. When shipping to and from Mexico, you’ll have to classify your goods based on the function you’re goods will have either in Mexico or abroad.
If you’re looking to export your finished goods into Mexico for sale or consumption – this is called “definite” importation. Alternatively, maybe you’d like to temporarily ship raw goods into Mexico to be assembled into a final product which will be imported back into the US – this is called “IMMEX” importation, and it allows you to avoid being taxed on the imported goods, since they are not staying in Mexico permanently. On the other hand, perhaps you’re importing materials from Mexico in order to manufacture your products here in the US. No matter the situation, compared to shipping domestically, there are a lot more factors you’ll need to consider when arranging the transportation of your goods.
When you ship a truckload of freight within the United States, it’s a pretty simple process, even though it may not feel like it sometimes! In general, your freight is only loaded and unloaded once with the same truck driver and trailer bringing your goods from door to door and you don’t need to involve any third parties, besides the carrier or freight broker. However, when you’re shipping to and from Mexico, it’s a little different.
In its journey from country to country, a different carrier will be delivering your freight than the original carrier who picked it up. Depending on whether you select “door-to-door” or “door-to-border” service, your freight may be loaded and unloaded multiple times onto different trailers. The services of a customs broker and freight forwarder will be required to assist with customs clearance. If you elect to use a third party-logistics company (3PL) for the arrangement of your shipments, many of these details can be taken care of for you, although you can choose to elect a customs broker or freight forwarder of your choosing if you’d prefer and if the freight is being delivered to you. The provider responsible for making these third-party arrangements depends on which direction you are shipping.
To break it down a little more simply, here’s a run-down of the process when you’re shipping TO Mexico (exporting):
Because it’s a little different going the other direction, here’s how it goes down when you’re shipping from Mexico to the U.S. (importing):
There’s one other important thing to note. The insurance liability for freight moving into Mexico is very different from the insurance liability in the U.S. All U.S. carriers offering door-to-door service have limited or no liability coverage for shipments once they cross the border into Mexico. It’s important to arrange additional cargo insurance for the Mexican portion of the journey, which you can usually arrange either through your logistics service provider or through the customs broker.
If you’ve never shipped to or from Mexico before, learning the process to do so can be a little confusing or overwhelming at times. However, through having offices in bordering cities, Team Members fluent in Spanish, and years of experience in shipping to and from Mexico , Trinity Logistics is your ideal partner to help you with this process and assist you with any of your Mexico shipping endeavors.
Find out what you need to know in the freight market update of May 2022.
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