Tuesday, October 30, 2012

AZMEX SPECIAL 29-10-12

AZMEX SPECIAL 29 OCT 2012

Note: Not quite that new, but interesting read.

Hijacked cargo new threat for firms in Mexico
October 28, 2012 12:00 am •
Dale Quinn For The Arizona Daily Star(
http://azstarnet.com/business/local/hijacked-cargo-new-threat-for-
firms-in-mexico/article_47b246c4-df31-5997-a15e-72cd81448ee7.html

GUADALAJARA, Jalisco - International companies that move goods from
Mexico into the United States have beefed up security measures in
response to increasingly organized, well-armed highway robbers.

These hijackers know what they want, which trucks are carrying it and
how to sell stolen products on the black market. As a result, some
companies that carry valuable merchandise - such as computers and
electronics - have gone so far as to use armed guards to escort their
loads through areas known to be particularly precarious.

"These criminals are now considered organized crime and they are more
prepared than in years past," Juan Carlos Aceves, who helps companies
secure their cargo as it travels through Mexico, said in Spanish.
Aceves works for a food company with operations in Central America,
Canada and Mexico.

At times, these organizations infiltrate companies and bribe
employees, Aceves said. Some hijackers are so well-informed they know
when a tractor-trailer is going to leave a location and what route it
will take, which allows them to plan the robbery in advance, Aceves
said.

Companies are tight-lipped about their security processes. A
representative from the computer company Hewlett-Packard, which has
manufacturing operations in Mexico, said its policy does not allow
for any discussion about its security process. Intel, Flextronics and
Jabil, other high-tech companies with operations in Mexico, didn't
respond to requests for comment.

Safe - with precautions

Those who work with international companies in Mexico stressed that
moving merchandise through the country is safe when the proper
precautions are taken. But the topic is clearly on the minds of those
who do business in a country with a reputation that's been tarnished
by violent drug smuggling organizations.

In May, warehouses and vehicle lots of the Mexican snack maker
Sabritas, a subsidiary of U.S. food giant PepsiCo., were hit by a
series of firebomb attacks. News reports said the company's
operations in the Mexican states of Michoacán and Guanajuato had been
targeted for extortion by a drug cartel.

On Aug. 25, criminals set vehicles ablaze at major access points to
Guadalajara - the country's second-largest city - in brazen acts that
clogged traffic and alarmed residents. Drug-smuggling organizations
carry out these blockades, which locals call narcobloqueos, as
demonstrations of power when one of their leaders is captured or
killed. They are especially disconcerting for Guadalajara, as the
city, which has a cluster of high-tech manufacturing companies and is
often referred to as the "Silicon Valley of Mexico," had long been
considered immune from drug-trade violence.

The narcobloqueos do have an impact on the area's image and
demonstrate how important it is that companies use safety measures
and have insurance, said David Toscano, the general director of
SADESPE, a security consulting company in Guadalajara. But they also
show that the authorities are acting against those responsible for
much of the violence, said Toscano, who's also the chairman of the
American Chamber of Commerce's security committee in Guadalajara.

Maquilas not targeted

Nelson Balido, the president of the Border Trade Alliance, called the
attacks on the Sabritas factories an "isolated incident." Balido,
whose organization works to expedite trade between the United States,
Mexico and Canada, said maquilas, or factories where U.S. companies
manufacture their products in Mexico, have not been targeted.

"That's not a widespread issue. Maquilas are not under attack or
under siege," he said.

Even so, security and its impact on transporting goods is a frequent
topics of discussion. In August, it was the theme of a conference in
Mexico City hosted in part by the Border Trade Alliance. Before that,
in March, representatives from about 12 U.S. companies met with
officials in Guadalajara to discuss ways to cut down on cargo theft.
At that meeting, the top law enforcement officer in the western state
of Jalisco said there were 432 incidents of cargo theft in the state
in 2011.

That's more than one per day, with most in the area around Guadalajara.

"And while many of the tractor-trailers and other vehicles hijacked
were recovered, less than half of their cargos were," a news release
from the U.S. Consulate General in Guadalajara says.

Thefts up 72% in 1 state

In another indication of the prevalence of theft, the Mexican
newspaper Reforma, using statistics from the National Public Security
System, reported a 72 percent increase in theft against cargo
carriers in the central state of Aguascalientes in the first half of
2012 compared with the same period the previous year.

Esther Rodriguez Silva, a project manager at Texas A&M's global
supply chain laboratory, said studies have shown that while companies
feel secure within their own facilities, they don't feel secure
outside them. There's a sense of fear traveling to and from a
company's site, and law enforcement doesn't provide much reassurance.

Major concerns for companies include the threat of extortion, crimes
against employees, invasion and hijacking.

To deter those threats, companies that move merchandise through
Mexico use GPS to track their products, conduct extensive background
checks on employees connected to the shipping process and use escorts
to monitor valuable loads, Toscano said.

They also carefully plan shipping routes to avoid dangerous areas.

The added security can get expensive, and, while many international
companies still find doing business in Mexico worthwhile, it means
consumers can end up paying more.
"When it's costing the shipper more to ship," Balido said, "someone
has to make up that cost."

Goods moving from Sonora into Arizona haven't been affected. Page D6
LOCAL ANGLE

Piracy and highway robbery haven't plagued companies that move goods
from Sonora into Arizona.

Most exporters in the Mexican state directly south of Arizona
manufacture components for the aerospace, automotive and medical
industries. Those products don't have much value on the black market,
said Eduardo Saavedra, executive vice president of business
development for The Offshore Group, which owns a massive industrial
park in Guaymas, about 300 miles south of Tucson.

Still, those looking to do business in Guaymas raise the issue, he said.
"It's always part of the conversation with a new customer," Saavedra
said. "It's always about costs and benefits, and security - of course
- comes up very quickly."

Usually a visit to Sonora allays any concerns businesses might have,
Saavedra said. Federal officers regularly patrol major highways
there. And, as it's one of Mexico's northern states, cargo doesn't
spend more than a day on roads there.

Dale Quinn is a freelance reporter based in Guadalajara. Contact him
at dalehq@gmail.com

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