Mexico Transportation

Market Update

January 27, 2023

Mexico Transportation Market Update

This Market Review Update is intended to provide you with high-level macroeconomic and general industry data that
may be relevant to your business. This update should not be used for any other purpose. This update does not state or
imply anything about Schneider’s performance, results, operations, strategy, projections or plans. The purpose of this
update is to relay statistical and relevant facts from various industry professionals. This update does not predict or
forecast any economic or industry outcome or results. This update has been prepared on the basis of information made
available by third parties; Schneider has not attempted to independently verify any such third-party information.

For the latest information and updates, visit Schneider’s Trending Topics page.
Schneider receives first Frieghtliner eCascadia battery electric trucks
Schneider recently received the first of almost 100 Frieghtliner eCascadia
class 8 battery electric vehicles (BEV) that will be used in their Southern
California Intermodal operations. These trucks are manufactured by
Daimler Truck North America, at their Portland, Oregon plant.

The addition of these trucks to the fleet significantly increases the

number of zero-emissions heavy-duty trucks available for goods
movement while achieving necessary emission reductions. The new
eCascadias have the potential to avoid over 81,000 pounds of carbon
dioxide emissions per day and over the course of a year that is
equivalent to removing 2,400 gas-powered cars from the road.

Schneider is tracking to become one of the largest battery electric truck fleets in North America and expects all 92
BEVs to be operational in its fleet by the end of 2023.

Read More
Schneider fully transitioned to Union Pacific for western rail service
Schneider recently completed the transition of all its western rail operation to
Union Pacific Railroad, making it the largest company driver dray fleet on
the rail network.

Schneider and Union Pacific have been collaborating closely over the
past year to ensure operations, technology, sales and customer teams
were aligned to ensure there were no disruptions for customers during
the transition. Schneider’s decision to work with Union Pacific moves
Schneider closer to its goal of doubling its intermodal size by 2030,
thus reducing CO2 emissions by 700 million pounds per year, by 2030.

Beyond sustainability benefits, Schneider’s intermodal fleet, one of the largest in

North America, now has access to more rail lanes and direct connections on
transcontinental freight as a result of the partnership with Union Pacific.

Read More
In the News: CVSA announces 2023 enforcement dates
The Commercial Vehicle Safety Alliance (CSVA) has announced the dates for the annual
enforcement campaigns in 2023. These campaigns are held throughout North America,
in the U.S., Canada and Mexico.

The first event will be International Roadcheck, scheduled from May 16-18, 2023.
This is an annual three-day event where CSVA-certified inspectors target different safety
initiatives for motor carriers and driver vehicles. This event is the largest targeted
enforcement program for commercial motor vehicles in the world, with roughly 15 trucks
or buses are inspected every minute across North America.

The other two events scheduled are Operation Safe Driver Week from July 9-15, 2023, and
Operation Airbrake Program, from August 20-26, 2023. It is important for shippers to plan
ahead of these enforcement campaigns in advance, as capacity is usually less available
during these times.

Read the article Source: ccjdigital.com; 11/16/22

In the News: Shippers require new cross-border strategies
For the past few years, shippers have felt more challenges on their
supply chains. It has become increasingly difficult for manufacturers to
secure the parts they need for products. Therefore, making it difficult for
shippers to get their products to their destination, especially when
shipping overseas.

Many shippers are looking for opportunities to shorten their supply chain
timelines, which is often done through nearshoring. Schneider recently
held an event for shippers in Mexico City where more than 50% of them
noted that their North America international shipment volumes increased from Q1-Q2 in 2022.

Cross-border shippers will need to develop a long-term strategy with experienced carriers to solve their capacity challenges.
This is a good time for shippers to look into where it makes sense to have a nearshoring location or warehouse based on
network and locations.

Read the article

Source: t21.com; 1/02/23
Learn more about new cross-border transportation strategies with this on-
demand webinar series: The Cross-Border Capacity Evolution

Watch Now

• Gain an understanding of ally-shoring and nearshoring, their trends in transportation and how other
organizations are incorporating them into their strategies.
• The value in mode diversification – such as intermodal or dedicated transportation solutions – to meet
capacity needs.
• How to utilize network engineering to optimize your supply chain network and develop your cross-border
strategy.
In the News: Nuevo Leon sells record abroad

The National Institute of Statistics and Geography (INEGI),

reported that Nuevo Leon exports increased 30% year over
year in the third quarter of 2022 – the highest amount
in history for any quarter of the year. INEGI also reported that
in the third quarter of 2022, Nuevo Leon was ranked third in
exports, behind Chihuahua and Coahuila.

Read the article Source: wsj.com; 1/10/23

In the News: US, Mexico and Canada North American Leaders’ Summit results in
collaboration and initiatives to improve supply chain resiliency
Leaders from the U.S., Mexico and Canada– U.S. President Joe
Biden, Mexican President Andres Manuel Lopez Obrador and Canadian
Prime Minister Justin Trudeau, among others – recently met in Mexico City for
the tenth North American Leaders’ Summit, a series of bilateral and trilateral
meetings to help align and discuss regional priorities.

The three countries agreed to plan to produce 25% of what is currently imported
from Asia to North America. This will all happen under a new plan to promote
the integration of the region’s economies, though it is unclear how quickly the
region plans to achieve this goal.

The three also agreed to collaborate on five initiatives to improve North American supply chain resilience and grow industries
such as electric vehicles and semiconductor manufacturing.

Read the articles here and here Sources: reuters.com; 1/12/23

supplychaindive.com; 1/11/23
In the News: Mexico’s tequila exports hit a record high

According to the data from the Ministry of Economy and the

Agricultural Markets Consulting Group (GCMA), Mexican tequila
exports – growing over the last decade reached record-breaking
levels in 2022. Numbers in the US grew from $849 million in 2012
to over $3.6 billion between January and October in 2022, a 34%
increase over the same period in 2021.

Read the article here Source: mexiconewsdaily.com; 12/26/22

In the News: Growing demand for Mexico road freight transport with a CAGR of
7% from 2022-2021, with the manufacturing end-user industry leading the way
Mordor Intelligence, market intelligence and advisory firm, reported in their recently released Mexico Road Freight Transport
Market Report that from 2016-2021 the Mexico freight market experienced a Compound Annual Growth Rate (CAGR) of 7%.
During 2021, the pandemic resulted in a decline, but has since substantially recovered.

Long-haul trucking services dominate the short-haul trucking industry as Mexico's

road transport, which accounts for more than 85% of the country's total freight
transport, including import, export, and national distribution of products to their
destinations.

Less than Truckload freight is the fastest-growing e-commerce market in North

America with a CAGR (2016-2021) of around 44%.

Read the article here Source: globenewswire.com; 1/19/23

Learn more from the webinar: The cross-border capacity crunch…solve for the
new normal

The freight capacity demand/supply imbalance between Mexico and the United States does not appear to be going away
anytime soon – in fact, it appears to be a new normal. The lack of freight moving southbound from the United States
leaves shippers that need to move freight northbound from Mexico scrambling to get equipment. Many cross-border shippers
are finding it difficult to secure the capacity they need, and within budget. With the rise of consumer demand due to the COVID-
19 pandemic, shippers need to find more creative solutions to meet demand.

Learn about the USMCA trade agreement, the impacts of the pandemic on trade between Mexico and the U.S., polices that may
hold incentives, or obstacles for foreign investment – and solutions for shippers to gain the cross-border capacity needed to
meet demand, including multi-modal and dedicated solutions.
.
Watch the webinar here
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