Sunday, January 15, 2012

Texas Manufacturing: Border Crossings and Economic Development

A group of communities around the Southwest are planning completely new and improved border crossings, hoping to bring in new Texas manufacturing jobs in their localities. A new bridge in El Paso County, Texas, could open in 2015. The challenge is demolishing an existing crossing and adding it into the new system -- the Guadalupe Tornillo International Bridge. In Nogales, Ariz., the Mariposa Land Port of Entry -- the principal port of entry for produce coming into the U.S. from Mexico -- is having a large $184 million reconfiguration that's slated to finish in 2014. And leaders in the San Diego area are planning a new freeway and port, the Otay Mesa East project, for 2015 which would cost as much as $700 million.

The hope is that a new crossing can spur commercial growth. American firms utilize low-cost workers in Mexican industrial facilities described as "maquilas" to manufacture textiles, electronic products together with automotive parts. Companies having maquilas will often have nearby corporate offices on the U.S. side, and warehousing along with trucking industries assist the circulation of products arriving north. Laredo, Texas -- the nearest U.S. crossing to Mexico’s commercial center of Monterrey -- hosts more than 1,000 logistics firms.

Over-crowding at border crossings could be a significant problem. Enhanced post-9/11 security measures have significantly increased wait times, and as more producers have moved to a just-in-time shipping and delivery model, backup on the road is often a serious problem. "That's why I think you're seeing so many bridges open up and border crossings open up," says Keith Patridge, president and CEO of the McAllen Economic Development Corp., whose organization is under contract together with the city to persuade organizations to locate to McAllen and Reynosa. "It's really being driven not necessarily by volumes of traffic but the speed at which the traffic needs to move.”

These areas believe that the investment and energy is going to be worth the effort: New crossings bring in new Texas manufacturing jobs new revenue.