As the United States, Mexico and Canada begin a formal review of the U.S.-Mexico-Canada Agreement (USMCA) on Wednesday, many shippers have already accepted a new reality: moving goods between the U.S. and Mexico will increasingly depend less on the tariff rate alone and more on how effectively companies can navigate a more complex regulatory environment.
The review comes as bilateral trade between the countries continues to expand, reaching $86 billion in April, according to the U.S. Census Bureau. Mexico remains the top trading partner of the U.S., accounting for 16.6 percent of America’s foreign commerce during the month.
Rather than expecting a return to the predictable trade environment that followed USMCA’s implementation in 2020, companies must instead invest in the operational capabilities needed to navigate changing customs requirements and cross-border regulations.
For many importers, that has elevated the role of customs brokers from administrative necessity to strategic advisor.
“U.S. entries used to be very basic, clear cut, predictable. That isn’t the case anymore,” said said Troy Ryley, president of Echo Mexico at Echo Global Logistics. “Having a broker that’s capable of reacting quickly in this environment and giving good consultation based on information that’s available has become a critical element.”
At the same time, Mexican customs authorities have strengthened compliance requirements, increasing documentation demands on both importers and logistics providers.
“That has driven more clients toward mid-size and large logistics companies…that are able to afford and put that type of infrastructure in play,” Ryley told Sourcing Journal.
Those changing customer needs have also shaped Echo’s investment strategy in Mexico. Earlier this year, the company launched its cross-border customs brokerage unit, EchoXBorder, offering customs clearance at U.S. and Mexican airports, ocean ports and major land crossings.
In 2024, nearly a decade after it began managing southern border shipping solutions, the third-party logistics provider (3PL) established localized operations in Mexico City, Monterrey and border-based trade hub Laredo, Texas. From there, the company further expanded on its warehousing, distribution and logistics services in the country.
Earlier this month, Echo broadened that strategy by launching comprehensive intra-Mexico transportation services, allowing customers to manage freight movements between Mexican ports, factories and distribution centers before crossing into the United States.
“We’ve spent millions of dollars in structural investment to ensure that we have the structures required by our clients as they continue to move forward and grow their businesses in this market,” Ryley said.
Those investments reflect a broader shift taking place across North American supply chains. Nearshoring, once viewed primarily as a cost-saving strategy, has increasingly become a resilience strategy as manufacturers seek shorter, more predictable supply chains amid geopolitical instability.
“As global markets become more unstable…it forces companies to shrink their supply chains closer to the Americas region,” noted Ryley. “Instead of having your freight on the water for 15 to 20 days and having to forecast out beyond that point, you could load at a factory in Monterrey and be in most U.S. cities within 24 to 72 hours for delivery. It’s a totally different dynamic, especially in a very volatile trade situation.”
Even as the negotiations regarding USMCA’s future remain uncertain, Ryley said he does not expect widespread disruption comparable to the supply chain shocks seen during the pandemic. While some importers may accelerate shipments ahead of potential policy changes, he believes the industry will have sufficient visibility into negotiations to avoid major bottlenecks.
According to Ryley, the more lasting impact of the USMCA review should come through tighter enforcement of rules governing regional content and country of origin. Under the current agreement, Mexico faces 25 percent duties on goods that do not meet USMCA rules of origin.
“The U.S. wants to make sure that there’s not a back door to the U.S. markets,” Ryley said, pointing to concerns that products assembled in Mexico with predominantly Chinese components could continue receiving preferential treatment under existing trade rules.
That could require manufacturers to increase the amount of value-added production performed within North America to maintain preferential tariff treatment, particularly in industries that rely heavily on imported components.
For logistics providers, the result is an operating environment where transportation alone is no longer enough.
“Compliance is going to become a bigger part of the realm,” Ryley said. “There’s more management involved in cross-border trade. The companies that don’t have the infrastructure or wherewithal to provide those compliance functions are probably going to go out of business, receive stiff fines or adapt.”
