October 2025 presents a fascinating paradox for cross-border freight: record-breaking trade volumes alongside unprecedented operational disruptions. While North American freight flows hit all-time highs earlier this year with March 2025 marking $144.8 billion in cross-border shipments, the industry now faces tariff uncertainty, technology failures, and infrastructure challenges that are reshaping how goods move between the United States, Mexico, and Canada. For freight brokers and shippers, understanding these dynamics isn’t optional—it’s essential for maintaining supply chain reliability in an increasingly complex regulatory environment.
Record trade volumes mask underlying tensions
Cross-border freight shipments between the United States, Canada, and Mexico totaled just over $144.8 billion in March 2025—representing an 8.4% increase over March 2024 and a remarkable 35% increase over 2019.
Trucks moved $94.2 billion of that freight in March, experiencing a 9.5% year-over-year increase. This included $67.5 billion with Canada and $77.3 billion with Mexico. Trucking now carries over 60% of surface trade along both the Northern and Southern land borders, solidifying its position as the backbone of North American commerce.
Among geographic gateways, Laredo continues to dominate. In March 2025 alone, Laredo handled $30.5 billion in freight—a 12.4% growth over March 2024. The port’s strategic location provides the most direct route between major industrial and population centers on both sides of the border, making it indispensable for automotive, electronics, and consumer goods shipments.
For the full year 2024, U.S. freight with Canada and Mexico combined totaled $1.6 trillion, representing a 1.8% increase over 2023. These numbers demonstrate that despite political tensions and regulatory complexity, North American supply chain integration continues to deepen.
Mexico emerges as America’s top trade partner amid nearshoring wave
Perhaps the most significant shift in 2025 is Mexico’s position as the United States’ largest trade partner, surpassing China. In 2024, Mexico supplied $466.6 billion in imports to the United States—representing 15.6% of all U.S. imports—cementing its role as a critical manufacturing hub.
The nearshoring phenomenon driving this growth shows no signs of slowing. Bank of America’s Mexico head stated confidently that “the nearshoring or friend-shoring phenomenon will not be reversed,” with the bank expecting to double revenue and client volume from 400 to 800 institutional clients over the next five years in Mexico.
Mexico’s Electronics Manufacturing Services market is projected to grow from $53.2 billion in 2025 to $97.4 billion by 2031—a 10.6% compound annual growth rate. This growth is fueled by nearshoring of semiconductors, telecommunications equipment, and automation systems. Mexico’s aerospace exports also reached $10 billion in 2024, surpassing previous records and marking full recovery from pandemic declines.
In the first quarter of 2025, five Mexican states—Chihuahua, Coahuila, Nuevo León, Baja California, and Tamaulipas—accounted for over 50% of Mexico’s manufacturing exports. This concentration near the U.S. border optimizes logistics efficiency and reduces transportation costs compared to Asian sourcing.
However, challenges persist. Mexico’s industrial output contracted 3.6% year-over-year in August 2025, deeper than the expected 2.2% decline. Manufacturing declined 3.1%, construction fell 4%, and mining contracted 6.8%. Rising factory wages (up 20% annually since 2019), skilled labor shortages, and strained infrastructure are eroding some of Mexico’s competitive advantages.
Despite short-term headwinds, long-term projections remain constructive. Manufacturing output is projected to grow at a 4.0% compound annual growth rate through 2028, and nearshoring could add an additional 3% to Mexico’s GDP over the next five years.
Tariff turbulence creates planning paralysis
The single biggest challenge facing cross-border shippers in October 2025 is tariff uncertainty. Current tariffs stand at 25% for goods not covered under USMCA, plus a 10% “universal” tariff on most other items. Cars and auto parts face an additional 25% tariff.
The National Chamber of Freight Carriers in Mexico expressed concerns that continued U.S. tariffs—and possible retaliatory tariffs—could reduce freight volumes and increase operating costs on both sides of the border. In February 2025, automotive production increased just 1.7% while exports dropped 13.7%, directly impacted by tariff uncertainty.
Beyond the automotive sector, 25% tariffs on furniture, kitchen cabinets, and bathroom vanities took effect in October, with increases scheduled for January 2026. Mexico’s National Auto Parts Industry Association estimates these tariffs could increase production costs by approximately $3,000 per vehicle and lead to a 1.5% decline in Mexico’s manufacturing GDP.
For freight brokers, this creates operational complexity. C.H. Robinson’s October 2025 market update noted that tariffs and compliance changes—including Mexico’s new declaration of value requirements—are adding layers of complexity to cross-border operations. Shippers are booking freight only 1-2 weeks before departure during slack periods, dramatically shorter than the recommended 3-4 week window for optimal equipment and space planning.
The upcoming USMCA review in 2026 adds another layer of uncertainty, though many analysts believe deeper trade integration within North America will continue regardless of political headwinds.
Technology failures highlight infrastructure vulnerabilities
While policy uncertainty dominates headlines, October 2025 also exposed critical infrastructure weaknesses at Canada’s border crossings. A Canada Border Services Agency IT system outage beginning September 28 caused delays of up to 38 hours for cross-border truck drivers at New York-Ontario crossings.
The outage began during routine maintenance when an “unforeseen technical problem” caused systems to fail. Border officers were forced to conduct inspections using paper forms, creating massive backlog. At the Peace Bridge and Lewiston-Queenston Bridge, commercial truck traffic came to a standstill, with some drivers reporting they were stuck since Monday and still not cleared to cross by Friday.
More troubling were the security implications. The Customs and Immigration Union representing border officers confirmed that officers missed potential security lookouts during the outage—warnings about people or shipments that might pose threats to Canadians. Without digital access to these alerts, officers couldn’t know about timely reports connected to individuals crossing into Canada.
The Canadian Trucking Alliance stated that the timing “couldn’t be worse” given existing supply chain pressures. With approximately 70,000 trucks crossing the Canada-U.S. border daily and 12,328 trucks per day entering Canada specifically, even short disruptions create cascading delays throughout North American supply chains.
Stephen Laskowski, President and CEO of the Canadian Trucking Alliance, emphasized the economic impact: “Investing in the IT that facilitates Canada-U.S. trade by truck is a nation-building exercise.” The incident highlighted years of underinvestment in border technology systems, with drivers reporting that IT failures “have become more common in recent years.”
Capacity dynamics vary dramatically by region and direction
Despite overall freight market softness, capacity conditions vary significantly by region, lane direction, and timing—creating opportunities for well-informed freight brokers.
Mexico capacity remains broadly available across most border-crossing locations, spanning from central Mexico, Bajío, and northeast regions to the U.S. Midwest, Southeast, and industrial areas. However, carriers are prioritizing return loads to Mexico to optimize border crossing logistics. Popular return lanes include Laredo to Puebla and Laredo to Aguascalientes.
The freight imbalance is significant: for every truckload shipped southbound from the United States to Mexico, approximately three truckloads move northbound. This imbalance reflects strong demand for automotive and electronics exports from Mexico but creates headhaul/backhaul pricing disparities that savvy shippers can leverage.
Carriers are increasingly selective about routes. They prefer lanes with fewer disruptions—avoiding roadblocks on key highways in central Mexico that impact transit times—and areas with lower cargo theft risks. In 2024, carriers faced a 20% increase in operating costs according to CANACAR, driven by fuel price increases (diesel up 6.33%), spare parts inflation, and security investments to combat rising cargo theft.
Canadian freight market dynamics differ substantially. Cross-border spot freight activity remained subdued through much of 2025, vastly different from the tight capacity during late March to early April when bad weather, rail backlogs, and pre-tariff freight surges created temporary tightness.
Rail congestion has significantly impacted intra-Canada long-haul capacity, creating upward pressure on truckload rates. As rail backlogs persisted, more shippers turned to full truckload to mitigate transit delays, placing additional demand on an already constrained market.
Practical strategies for navigating cross-border complexity
Given these challenges, successful cross-border shippers and freight brokers are adopting several strategic approaches:
Develop flexible routing strategies. At Laredo, Texas, shippers are exploring alternative crossing points like the Colombia Bridge for faster processing when primary crossings experience congestion. The new Otay Mesa East Port of Entry—receiving a $150 million Infrastructure for Rebuilding America grant—will include 10 dedicated lanes (five each for passenger and commercial vehicles) with construction scheduled for fall 2025 and completion by late 2027.
Leverage bonded freight solutions for Mexico-Canada movements. Shippers moving freight between Mexico and Canada can utilize in-bond transit through the United States, avoiding a U.S. consumption entry and reducing both delays and potential double tariffs. Freight is not offloaded or distributed in the U.S., and upon arrival in Canada or Mexico, goods are cleared only once, reducing overall friction and speeding transit times.
Maintain close communication with transportation providers. In an environment with regional capacity imbalances, rate volatility, and unpredictable border delays, relationships matter more than transactional bidding. Proactive communication about potential delays, alternative routing options, and capacity constraints helps both parties navigate disruptions.
Plan for the 2026 USMCA review. While most analysts expect the agreement to continue supporting North American trade integration, shippers should monitor developments. The 45-day public feedback period for the USMCA review process began in October 2025, offering opportunities for industry input on agreement modifications.
Invest in compliance expertise. With Mexico implementing digital truck driver’s licenses, new declaration of value requirements, and ongoing tariff adjustments, having internal or outsourced customs expertise is essential. C-TPAT, PIP, and CSA security standard compliance remains critical for maintaining trusted trader status and avoiding delays.
Monitor infrastructure projects. The Interoceanic Corridor in the Isthmus of Tehuantepec aims to establish Mexico as an alternative to the Panama Canal, with a modern railway linking Atlantic and Pacific coasts. While challenges around timely completion, regional security, and sustainable energy supply remain, this project could fundamentally reshape North American trade flows if successful.
The road ahead: Opportunity amid complexity
October 2025 presents a North American freight landscape defined by contradictions. Record trade volumes coexist with technology failures. Nearshoring momentum persists despite industrial output contractions. Abundant capacity in some regions contrasts with chronic tightness in others.
For Luna Logistics and other freight brokers, this complexity creates opportunities for those who invest in understanding regional dynamics, regulatory changes, and infrastructure limitations. The brokers who succeed in this environment will be those who can translate cross-border challenges into solutions—whether that means identifying alternative crossing points during delays, structuring bonded freight movements for Mexico-Canada shipments, or advising clients on optimal booking windows given tariff uncertainties.
The fundamentals remain strong: North America’s $1.6 trillion in annual cross-border freight reflects deeply integrated supply chains that benefit all three countries. While tariff policy and technology disruptions create short-term headaches, the long-term trajectory points toward continued growth in regional trade—driven by nearshoring, just-in-time manufacturing strategies, and geographic proximity advantages that no tariff can eliminate.
The next twelve months will test the resilience of North American supply chains. Shippers and brokers who approach cross-border freight with strategic thinking, strong carrier relationships, and operational flexibility will be best positioned to navigate whatever challenges 2026 brings.
This analysis reflects cross-border freight conditions through October 2025. Trade policies and operational conditions continue evolving, and companies should consult official sources and experienced cross-border logistics providers for specific routing and compliance strategies.