The Obama administration began efforts Friday to ease an erupting trade dispute with Mexico by starting work on a new program to give Mexican truckers broader access to U.S. highways.

Transportation Secretary Ray LaHood met with officials from the State Department and the Office of the U.S. Trade Representative to design a cross-border trucking program “that will meet the legitimate concerns of Congress and our [North American Free Trade Agreement] commitments,” said a White House spokesman.

A person familiar with the meeting said the participants “are going to work to get a proposal everyone likes before President Barack Obama’s trip to Mexico in April.”

The administration’s move comes after Mexico earlier this week slapped tariffs on $2.4 billion in U.S. goods ranging from grapes to toilet paper. Mexico said its action was retaliation for a provision in a budget bill Mr. Obama signed earlier this month that effectively shut down a pilot program that had allowed some Mexican truckers to transport cargo beyond a 25-mile commercial zone inside the U.S. border. Mexico says the U.S. is failing to meet its obligations to cut barriers under Nafta.

Business interests ranging from Pennsylvania-based Hershey Co. to the USA Rice Federation are urging the White House to permit qualified Mexican truckers to drive on U.S. roads. Exporters affected by the tariffs say the government is causing economic damage by catering to unions that are more concerned with protecting jobs than improving safety.

“This is the Obama administration trying to appease the Teamsters union without taking into account the effect it’s going to have,” said John Crossland, chairman of the California Association of Winegrape Growers.

The results of the pilot program, while limited, suggest that Mexican truckers in it operated safely. A year into the program, the Transportation Department’s inspector general and independent examiners reported no major crashes caused by Mexican participants. They said Mexican truckers passed inspections at a much higher rate than U.S. carriers.

The investigators also said fewer than 30 Mexican carriers and only about 100 trucks participated in the pilot program, making it hard to draw final conclusions. They said U.S. regulators couldn’t ensure that every Mexican truck was being inspected when it crossed the border.

Democratic lawmakers and unions say Mexican truckers pose serious safety concerns because they don’t have to comply with the same standards as American carriers. Critics say the pilot program was flawed because too few trucks participated to make up a representative sample, and most trucks in the program never ventured beyond the 25-mile commercial zone, so their broader impact is still unknown.

Kenneth Mead, a former inspector general who reviewed the pilot program, said the Mexican trucks that participated in it received scrutiny well beyond what the average U.S. trucker faces. “If you applied the same standards to U.S. trucks, you’d probably enhance safety,” he said. The problem, he said, is that the study was so small. “Will you be able to apply the same level of scrutiny if you open it to a much broader population of Mexican trucks?” he asked.

Jose Gil, traffic manager at Transportes Olympic, a Mexican company that had four trucks in the pilot program, said the company met U.S. regulations “every single time.”

One indicator on the safety of Mexican trucks could be that roughly 1,700 are already on America’s highways, “grandfathered” out of the restrictions. Mr. Mead’s review team found that these trucks failed vehicle inspections at rates that were slightly higher than those for U.S. trucks.

SOURCE: CHRISTOPHER CONKEY - Wall Street Journal