Increased bridge traffic might indicate higher retail sales

More Mexican nationals shopped the Rio Grande Valley this Christmas, likely boosting retail sales and tax revenues during a holiday season many had eyed with concern.

Valley cities won’t know for weeks, when sales tax receipts are released, just how retailers performed, but a rise in bridge traffic suggests the vaunted Mexican shopper might have delivered struggling stores a Christmas windfall.

“Merchants and restaurant owners and operators of hotels should be happy,” said George Ramon, director of two area bridges for McAllen. “This is a very good indicator of our economic situation.”

Cities and retailers bank on Mexican nationals, especially the wealthy from Monterrey, to spend millions every year, but tying an increase in bridge traffic to higher retail sales can be dubious. Mexican nationals might have spent less, even if more came. It’s also possible that U.S. consumers spent less, upsetting the hopes of local officials.

But generally, when the number of crossers rise, so do sales.

At Hidalgo County’s three major international bridges, close to 4,000 more vehicles crossed into the United States the two weeks before Christmas this year than in 2008, according to data provided by Pharr and McAllen.

It’s a meager 4 percent rise, but after nearly three years of declines, it might either be a sign the area’s economy is on the mend or that the wider economy is stable enough to entice Mexican nationals to spend in the Valley.

It could also be the case that the new Anzaldua International Bridge, which allows Mexican nationals to skirt the western edges of Reynosa and bypass downtown traffic, has boosted crossings.

“It seems to be helping, but it’s too early to tell,” said Mike Perez, McAllen’s city manager. “It’s a little higher than we thought it would be.”

Jesse Medina, director of the Pharr-Reynosa International Bridge, said that so far the new Anzalduas bridge has not caused a fall in traffic at his bridge.

“You look around at all the businesses and they were packed so we definitely had more shoppers,” Medina said. “Even though we’re not going to know for a while yet what the actual numbers are, they’re going to look good.”

With economic worries having stifled spending, and a declining peso and growing drug war deterring Mexican nationals from shopping the Valley, retailers have watched profits decline for more than a year. Cities such as McAllen rely heavily on sales tax revenues to boost budgets have had to cut spending to make up for the shortfall.
Early reports this season from area retailers have been mixed.

Eli Lizka, owner of Colors Name Brand Clothing, said sales at his store at 114 S. Main St. were better than expected, a rise he saw early evidence of in the middle of November. During the weekend of Nov. 14 and 15, Mexican shoppers thronged downtown McAllen, clogged bridges and gave retailers what they hoped was a prelude to a jolly season.

For some retailers the dream did not come true and sales remained low. Other downtown McAllen shops were down close to 30 percent, some business owners reported.
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Sean Gaffney covers business, the economy and general assignments for The Monitor. You can reach him at (956) 683-4434.