Border Chokepoints Cost U.S. Economy $4.13 Billion Per Year

Over 5.2 million jobs in the United States are dependent on trade with Canada, according to a report by the Ontario Chamber of Commerce (OCC). Without immediate improvement at border chokepoints, the U.S. could lose 17,345 jobs by 2020 and 91,194 jobs by 2030.

In May 2004, the OCC released “The Cost of Border Delays to Ontario,” a report on the economic impact of border delays on Ontario-based businesses. That study identified a need to examine the impact across the border in the U.S. With $1.2 billion in trade crossing the border each day, delays cause as much as $4.13 billion in avoidable costs on the U.S. side of the border each year. Trucks moved 72.6% of the U.S. exports to Canada (by value). Three border crossings accounted for 59.9% of merchandise trade that moved by land between the U.S. and Canada. They are Detroit-Windsor, Buffalo-Niagara Frontier and Sarnia-Port Huron. Of the $207.7 billion this represents, $91.9 billion crossed at Detroit, $60.3 billion at Buffalo and $55.5 billion at Sarnia.

Volume was already creating problems at U.S.-Canada border crossings even before the events of September 11, 2001. Total trade between the U.S. and Canada grew 152% following the implementation of the North American Free Trade Agreement (NAFTA) and commercial traffic increased 122.5%. This represented a volume of 14 million trucks in 2002.

The automotive sector reported cross-border flows of parts and vehicles totaled over $153 billion in 2002. “The auto industry can only take advantage of the integration when border crossings are efficient, smooth, and reliable,” said the report. In one example projecting production for a single automotive plant in 2010, it said border delays associated with production at that plant alone could cost as much as $34.12 million.

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