Borderlands: Austin’s manufacturing sector is booming

Borders is a weekly recap of developments in the world of cross-border trucking and trade between the United States and Mexico. This week: Austin, Texas’ manufacturing sector is booming; Mexico’s freight transportation GDP fell last year; reverse logistics company opens facility in Fort Worth; and CBP finds massive drug load in auto parts shipping.

The capital of Texas has a range of inbound factories

With new factories planned by tech giants like Samsung and Tesla, along with a dozen announced facilities from other companies in the works, manufacturing in Austin, Texas is booming.

While Austin has had a strong manufacturing base for decades, the past 17 months have seen a series of victories for the region, most recently Continental AG, Plastikon Industries, Simwon, CelLink, Viking Supplynet, American HVAC Metal Supply Inc and Lanter Delivery Systems.

Ed Latson, founder and CEO of the Austin Regional Manufacturers Association (ARMA), said the region’s unique workforce is one of the main factors attracting new factories.

“I think what’s unique about Austin from the rest of Texas is our advanced manufacturing workforce,” Latson told FreightWaves. “There’s a lot of electronics, instrumentation, and semiconductors being built here, which has really created a vibrant workforce that calls for a lot of these advanced factories coming in, like Tesla. “

Latson founded ARMA in 2013 as a trade association focused on strengthening the Central Texas manufacturing community through advocacy, workforce development, and networking.

ARMA members include some of the largest employers in the Austin area such as Samsung, Applied Materials, NXP, ICU Medical, and National Instruments, as well as 250 small and medium-sized businesses in industries such as food and beverage, bio / pharmacy, automotive, printing and metal fabrication.

“There are about 1,800 manufacturers in Austin [metro region]”Latson said.” It’s a very high tech community. About 50% are computer and electronic products. We also have a very strong bio / pharmaceutical and medical device manufacturing hub. “

When Latson launched ARMA nine years ago, Austin already had a strong industrial presence, he said.

“There were already some strong players here,” Latson said. “There was already about $ 12 billion in annual output produced by manufacturing companies in the region. This production has reached about $ 14.5 billion per year.

The FreightWaves SONAR platform includes the Outbound Tender Market Share Index which measures the relative percentage of outbound tender volumes in each market in the United States, totaling 100. The Austin Market recently accounted for 0.36% of total outbound truckload demand and is growing significantly. compared to previous years.

To learn more about FreightWaves SONAR, click here.

Austin’s manufacturing output is expected to increase significantly when Tesla’s (NASDAQ: TSLA) billion-dollar gigafactory begins production early next year.

Another recent victory for Austin was Samsung’s announcement to build a $ 17 billion semiconductor chip factory in Taylor, Texas, about 28 miles northeast of the city. The facility is expected to open by the end of 2024.

Latson said Samsung’s new factory in Taylor highlights the re-evaluation of its supply chain by the United States.

“We have been exposed in this country for not having enough domestic resources to make chips,” Latson. “There is a lot of interest in having a greater national presence in manufacturing, as well as shortening supply chains, looking for local and regional suppliers that you can have personal relationships with. “

Mexico’s transport GDP fell sharply last year

The gross domestic product (GDP) of freight transportation in Mexico fell 10.1% year-over-year in 2020, according to an annual report titled “Knowing the Freight Transportation Industry” from the Mexican government.

Overall national GDP fell 8.2% in 2020, driven by the effects of COVID-19 on factories and other economic activities, according to the report.

Freight transportation further contributed 3.3% of the Mexican economy’s GDP last year. The trucking industry quickly recovered when the economy reopened in June, boosted by freight from the auto, mining and construction industries.

Employment in Mexico’s trucking industry fell 1.5% year-over-year in 2020 to about 982,000 jobs, with pandemic disruptions taking away about 15,000 jobs.

Reverse logistics company opens facility in Fort Worth

goTRG, which works with manufacturers and retailers to handle the logistics of returned merchandise, is set to open a 250,000 square foot facility in Fort Worth, Texas.

The Miami, Florida-based company operates 15 facilities in six states, as well as one facility in Canada. The Fort Worth facility, which will create 200 jobs, is goTRG’s first facility in Texas.

“We are excited to open our next reverse logistics center in the Dallas area, where there is a large workforce and easy access for product transportation,” said CEO and Founder Sender Shamiss in a statement.

CBP finds massive drug load in auto parts shipment

U.S. customs and border protection officers at the port of Nogales, Ariz., On Wednesday discovered a record amount of methamphetamine, a statement said.

Officers at the Mariposa commercial port of entry seized 3,280 pounds of methamphetamine hidden in a shipment of auto parts from Mexico while inspecting a tractor-trailer.

Officers seized the drugs and the vehicle, while the truck driver was arrested and turned over to Homeland Security Investigations.

Click for more FreightWaves articles by Noi Mahoney.

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