Cross-border Capital: Laredo’s History in Freight

 

Laredo is, at first blush, a humble city that straddles the border between the US and Mexico. With a population of 260,000 and a history that stretches back to the 18th century, Laredo is the picture of a frontier settlement that made a graceful transition into the modern era. Home to three golf courses, two school districts, and an international airport, this Texas town seems about as unremarkably all-American as you can get.

It might be surprising, then, to know Laredo is also one of the busiest ports in North America, and at points has outstripped even the Port of Los Angeles as America’s Number One trading hub.In 2017 alone the city saw over $300 billion dollars in trade, making it only the third city in America to break the $300 billion barrier (the other two being the Port of Los Angeles and the Port of New York). This is particularly remarkable when, in a given year, the annual number of trucks flowing through Laredo outnumbers locals nearly 8 to 1.

“Freight runs in our blood,” confirms Laredo native Gerardo Alanis, CEO of Cold Chain Solutions.

 

1904 “Rio Grande Bridge, Laredo Texas” courtesy of The DeGolyer Library, Southern Methodist University.

 

So how did this sleepy little colonial village rise to become the largest trading powerhouse you’ve never heard of? The truth is a long story involving twin cities, a failed rebellion, and a decade-defining trade agreement.

 

 

Frontier Roots

 

Like most of the Southwestern United States, Laredo has its roots in Spanish colonialism. Founded in 1755 in what was then dubbed the “Nuevo Santander” region of New Spain, Laredo was the first settlement in Texas that broke ground “without financial aid or military protection from either State or Church.”

This sense of rugged individualism served the tiny town well through its first fifty years – an era plagued by hardship. Droughts, floods, “murderously regular” attacks by natives, and the looming threat of distant (but ever advancing) English and French colonists made for a less than peaceful life on the new frontier.

Nonetheless, the settlers prevailed. By the year 1820 Laredo, now part of a newly independent Mexico, had grown from a tiny adobe hamlet of just three Spanish families to a bustling town of 1,400. Thousands of heads of cattle grazed outside the burgeoning metropolis as locals farmed bottom ground near the Rio Grande.

 

 

A Tale of Two Cities

 

After a very brief stint in 1840 as the capital of the Republic of the Rio Grande (one of many short lived independent nations that cropped up during the Mexican Federalist War), Laredo found itself at yet another crossroads of nations. Having changed hands from New Spain, to the Mexican Empire, to the Republic of the Rio Grande, it once more faced new management in 1846 when Texas Rangers claimed the settlement.

Unlike other outposts that chose to recognize the Republic of Texas’s rule, Laredo considered itself to be part of Mexico. This claim went unchallenged until the Mexican War and the arrival of the aforementioned Rangers, hellbent on claiming it for the newly-minted nation.

 

An image of US Army base Fort McIntosh, first established in 1849 in Laredo, Texas

 

Now the citizens of Laredo had a choice to make – stay on the northern side of the Rio Grande and become Americans, or pack up and head south to maintain their Mexican citizenship. Some did exactly that, gathering up their families and cattle and relocating across the river, where they founded the very appropriately named city of Nuevo (“New”) Laredo.

And thus, the twin border towns of Laredo and Nuevo Laredo were born.

 

 

Freight Roots

 

Even before the official establishment of the US/Mexico border, the city of Laredo was one of the oldest border crossing points in the US. Tienda de Cuervo, who inspected the community in 1757, reported that Laredo “was the usual crossing place for those traveling to Texas from Nuevo León and Coahuila

After the founding of Nuevo Laredo, the city’s position as the “Gateway to Mexico” solidified. With the arrival of the Corpus Christi-Laredo railway in 1880 and the Mexico-Laredo railway in 1881, Laredo’s population boomed. By 1890, Laredo was “a major thoroughfare for trade between the United States and Mexico” with a population of over 11,000.

 

“Laredo, Texas. The Gateway to and from Mexico.” An 1892 perspective map of Laredo.

 

“[Laredo is] the most logical logistic corridor for freight moving from Mexico to the US,” explains Rafael Tawil, General Manager of Laredo-based trucking company TUM Logistics. “Because we’re so well located geographically, it made for a perfect situation.”

“It’s the hub of cross-border,” echoes Hector Sandoval, co-owner of DB Xpress LLC, a trucking company in Laredo. “For anything going in and out of Mexico, Laredo is the place to be.”

 

 

NAFTA Boom

 

Laredo and her sister city of Nuevo Laredo were, excuse the pun, really trucking come the 1990’s. Already perfectly positioned for trade with Mexico, the enactment of the North American Free Trade Agreement in 1994 was the last piece of the freight puzzle.

“When NAFTA was signed, it really was the perfect formula for a Laredo boom,” says Tawil. “It created an explosion of manufacturing in Mexico, and that caused a lot of freight routes to run through Laredo.”

Cross-border trade exploded, bringing Laredo along for the ride.

“My great grandfather started a customs brokerage in 1917 – about 100 years ago. It’s nothing now like it was then,” says customs broker Ermilo Richer of Richer Agencia Aduanal. “They were moving like a palette a week, or a small box a week every two weeks… Growth happened in the late 90’s, early 2000’s. It’s still growing, but that’s when it really took off.”

“I’m originally from Mexico, and it’s the American dream for my family.” says Ernesto Gaytan, general manager of Super Transport International and president of the Laredo Motor Carriers Association. “We moved to Laredo in the early 90’s with one truck, and now we have 500 trucks. We’ve lived the advantages of NAFTA and we’ve been blessed to live in a city that has seen such tremendous growth.”

 

 

Laredo Today

 

Laredo is now the center of cross-border freight in America, drawing in logistics companies and professionals from across the US and Mexico, fueling its growth.

 

San Agustin Plaza in Laredo, Texas

 

“[Laredo is] in the shortest corridor between main cities in Mexico and the US, so there’s a lot of work in the industry,” says Richer. “From freight to warehousing to logistics… We have people from Chicago, Houston, lots of people moving here. There’s a tremendous amount of work.”

“It seems like every day there’s a new massive warehouse around the corner, and more trucks on the ground. It’s just crazy,” says Tawil. “When I was growing up, most of the trucking presence was these national carriers with local terminals in Laredo with foreign drivers. Now you’re seeing a big boom of trucking companies owned and operated by locals. You’re seeing local companies compete with national guys.”

“Nobody really turns and looks at Laredo because we’re considered a boring city with little to no activity,” says Alanis. “But in reality, there is a lot going on in Laredo. Especially business-wise. I guess that’s kind of a misconception, that we’re a small city. Population-wise we are, but in regard to activity, we should be considered a big city.”

 

 

A Cross-border Culture

 

Trade is only a piece of Laredo’s “cross-border” culture. Being situated between the US and Mexico means the city has cultivated a unique blend of traditions.

“I think [Laredo] is the perfect spot where that blend exists,” says Tawil. “You have a mix of Hispanic and US culture both in one city. You have what we call “Texmex” people who identify as both. They celebrate George Washington’s birthday and Cinco de Mayo and Dieciséis de Septiembre. I’m an example of that, I identify as both. I’m a citizen of both countries, and you see a lot of that.”

The cultural mingling goes beyond any single holiday or celebration, however, and suffuses everyday life in the border town.

“Our culture is Mexican, but our way of life is American,” explains Sandoval. “Day by day we embrace both cultures. It’s hard to explain or understand. We embrace them both and celebrate them both.”

 

The student mural “Colores de Mi Barrio” in the El Azteca neighborhood of Laredo, Texas

 

A good example of that day by day celebration? The language.

“Even though Laredo is in the US, it’s a Spanish-speaking town,” clarifies Richer. “The signs are in English, but you could get around the whole city without speaking a word of English.”

One of the more unique celebrations of the city’s cross-border culture is George Washington’s Birthday.

“The Washington Birthday Celebration is very unique and special.” Says Gaytan “There’s an airshow, a parade, a carnival… it gets pretty crazy! We had Nancy Pelosi come to the last one! We also do an Abrazo, a traditional coming together ceremony between Laredo and Nuevo Laredo. Officials from both towns meet in the middle of the [Juarez-Lincoln Bridge] and exchange hugs. It’s a highlight!”

“There’s a big parade and a colonial ball.” Confirms Richer, “we have politicians and actors and celebrities visit. There’s even a jalapeno eating contest, to make it a little Mexican!”

 

Cinco de Mayo

 

Perhaps the most popular holiday imported from Mexico, Cinco de Mayo is maybe the truest example of a cross-border holiday. Cinco de Mayo commemorates the battle of Puebla, where the Mexican Army claimed victory against the larger and better equipped French Empire. But, while the holiday is quintessentially Mexican (no Americans feature in the story in any real capacity), it’s celebrated more in the US than in Mexico.

In fact, the first real celebrations of Cinco de Mayo were started by Mexicans living in California who lead parades in 1862, where “revelers carried the U.S. flag and the Mexican flag side by side; they sang both “The Star-Spangled Banner” and the “Himno Nacional Mexicano.”

The people of Laredo similarly celebrate what they consider a “Mexican-American” holiday.

“Cinco De Mayo is a big celebration in the US of Mexico and Mexican culture,” says Richer. “There are happy hours all over town and festivities going on.”

“The bridge closes early,” reveals Alanis. “We have a lot of events in schools and in the arenas. You have employees dress up in Mexican dress. The same applies to schools. There are a lot of themed parties. Carne Asadas and all that.”

There’s even an annual Cinco de Mayo golf tournament that’s gained popularity within the logistics community.

“We’ve taken up how the US celebrates!” Says Sandoval. “Me and my friends run a golf tournament for Cinco de Mayo. People from all over the US come to this tournament and celebrate. It’s a Mexico style tournament where it’s not just a golf tournament, it’s an event. It’s a party!”

“The Cinco de Mayo date was a happy accident,” Sandoval continues, “but we wanted it to have a theme. Now it all fits. And it celebrates our heritage.”

 

Looking Forward for Laredo

 

What does the future hold for the “The Gateway to Mexico”? It’s hard to know for sure, but the natives are optimistic.

“Laredo will continue to thrive in international trade,” predicts Richer. “Our local college and university are working tremendously hard to recruit top talent and are instituting great programs to attract the best.”

“It has a lot of potential,” agrees Tawil. “One of the biggest hurdles we had to overcoming was the signing of the new trade agreement. Now that we have the USMCA signed, that almost guarantees that a lot of the freight that moves through Laredo will continue to do.”

 

 

Parting Words

The spirit of Laredo and its culture is best embodied by its people.

“We’re warm people, we love to host,” says Gaytan “[Forager CEO Matt Silver] will be the first to tell you it’s a culture where we like to treat to people. We show love with food, so if you come down, be ready to gain a couple pounds!”

“A lot of people don’t know about the beauty of Laredo’s people.” Says Sandoval. “You have the best of both worlds. You have this old school new school type thing. When people come, they always want to come back.”

When asked for his final thoughts, a single sentence to sum up his city, Gaytan had this to say:

“Everyone is welcome in Laredo.”