Twenty-five years ago, Mike Gamel, co-founder of Mexpress Transportation, had a vision for how he could improve cross-border transit between Mexico and the United States.
Gamel knew that cross-border trucking often got bogged down by the border-clearance process. He believed he could get around these snarls by creating a bonded road-feeder service between the U.S. and Mexico. A bonded road-feeder service involves moving cargo by truck between airports. Such a service, Gamel surmised, would allow the shipment to bypass the traditional border clearance process and instead clear customs at the airport—just as if it had been shipped by air—reducing delays and lowering costs.
It was a bold move that paid off. Mexpress currently provides full truckload (FTL) and less-than-truckload (LTL) service between the United States and 14 Mexican airports.
To honor his vision and the work Mexpress Transportation has contributed to the transportation industry, the Council of Supply Chain Management Professionals (CSCMP) awarded Mexpress the 2022 Gail Rutkowski Transportation Excellence Award (GR-TEA) this past September at its annual EDGE Conference in Nashville, Tennessee.
Created in 2021 to honor shipper, carrier representative, and consultant Gail Rutkowski for her lifetime of service to the industry, the GR-TEA award recognizes companies or individuals who have excelled in using their knowledge, connections, and industry expertise to educate, support, and create long-term impacts in transportation-related fields.
For Mexpress Transportation, the past 25 years have served as an opportunity to create a unique company—one dedicated to improving supply chain inefficiencies between the U.S. and Mexico. According to the company, its transit times between the U.S. and Mexico are comparable to deferred air freight and are more cost efficient and consistent than air.
In this conversation with Supply Chain Quarterly’s Managing Editor Diane Rand, Gamel talks about the company’s vision and what the future looks like for cross-border trade between the U.S. and Mexico.
Mexpress has a unique business model. Can you explain what a “borderless” LTL and FTL road feeder service is?
Mexpress has a special “bonded” authority that allows our trucks to cross to and from Mexico without clearing Mexican customs at the border. Instead, the freight clears at the airports with exactly the same process as air freight. All other trucking companies have to deliver the freight to the importers—Mexican brokers’ warehouses—for clearance before entering into Mexico. This creates lots of delays and extra costs, not to mention that once the freight is cleared at the border, the truck can only have one broker per truck. Mexpress bypasses this process, so we can put multiple brokers on the same truck and go directly to the destination airport for clearance by the importers’ Mexican broker upon arrival.
How did the idea of creating such a service come about? What sparked the idea?
I received a call one day from Carlos Duron, now my partner and president of Mexpress, wanting to discuss a consolidation project he was working on for a client of his in Mexico. We got to talking about the border bottlenecks and all the other issues that U.S. truckers face every day to move freight in and out of Mexico. The more we talked, the more the idea emerged. That’s when we decided to approach the Mexican government to get their input. Although it took three and a half years of meetings, here we are!
What sort of hurdles did you face in setting up such as a service?
The biggest hurdle was establishing a process for paying duties and taxes to the Mexican government. All duties and taxes must be paid electronically on each shipment moving by traditional truck before it can cross the border. With Mexpress, a shipment cannot leave the Mexican airport until these duties and taxes are paid. The second issue was security. To ensure the security of the shipments on our trucks, we have had to take certain precautions like only using the toll roads that have military security check points and using satellite-tracked equipment that are monitored 24/7 with a “kill switch” in all power units. We also use a special bolt seal issued to us by the Mexican government, which cannot be broken by anyone but Mexican customs officials at the airports.
What advice would you give to someone who is interested in setting up their own company in the logistics space?
Base the company on service and honesty, not price. Service always wins out. The other advice I would give is to remember that the employees are the key to making your vision come true. So pick wisely and take great care of them!
How has cross-border trade between Mexico and the United States changed since you started Mexpress?
When we first started, Mexico was hardly a blip on anyone’s radar. Carlos and I knew that with the issues overseas, prices of air and ocean, along with the delays associated with getting the product to the U.S./Canada market, that Mexico was going to play an important role in future growth of our economy. When we started Mexpress, Mexico wasn’t ranked high as a trading partner with the U.S. In the last two months, however, it was ranked as the No. 2 trading partner, with Canada being No. 1 and China No. 3.
Do you expect to see an increase in nearshoring to Mexico in the next five years? Why or why not?
There is no doubt! Mexico trade with the U.S. and Canada is booming and is not going to stop.
How will such a shift affect your business?
It will definitely just increase our business.
The driver shortage has been a challenge for trucking companies for many years. What steps is Mexpress taking to recruit and retain good drivers?
We have not had an issue with driver shortages, as we have done a good job taking care of our team members. We have avoided some of the pitfalls facing other companies because we’ve put the focus on our employees.
You have been very involved with industry associations such as CSCMP and NASSTRAC over the years. Why has involvement in these groups been so important to you, and what do you think your company has gained from those efforts?
Not only has our involvement with CSCMP/NASSTRAC gotten us more business through meeting companies, referrals, and learning the needs of other members, we have made friendships that will last forever. CSCMP has a super supportive team, and we are proud to be a part of the organization for more than 35 years.