Recent and upcoming investment in Mexico

COVID-19

During July the third wave of COVID-19 infections has accelerated in Mexico and the level of restrictions on mobility and business activities has increased.  One state returned to red, the highest level on the epidemiological traffic light system, and the number of states at the second highest level, orange, jumped from one to five.  The alert level in Mexico City continues to rise, going from green to yellow to orange since early June.  Nonetheless, the Health Ministry (Secretaría de Salud) has expressed reluctance to place strict restrictions on business and mobility in order to allow the economy to function.

ECONOMY AND INDUSTRY

  • Mexico’s exports of auto parts grew by an annualized rate of 22.5% through the first four months of this year, according to Economy Ministry data. Industry analysts cited increased regional content requirements under the new USMCA trade agreement as boosting exports to the United States and Canada. (El Financiero, July 19, 2021)
  • Same-store retail sales in June rose 14.4% with respect to the same month last year, the National Retailers Association (ANTAD) reported. Monthly year-on-year retail sales data continue to reflect the impact of store closings in 2020 due to the COVID-19 pandemic. (Citibanamex Reporte Económico Diario, July 13, 2021)
  • In May, a record number of visitors from the United States arrived by air in Mexico, according to the Anahuac Tourism Research Center (Cicotur). The 970,000 air passengers from the U.S. during the month exceeds the number for the same month in 2019, before the start of the COVID-19 pandemic. (Reforma, July 6, 2021)

ECONOMIC ACTIVITY OF NOTE                                                                                             

  • Manufacturing: S. home appliance manufacturer Whirlpool reported plans to expand operations at its manufacturing plant in the northern state of Coahuila. The US$120 million expansion will upgrade infrastructure and add line capacity to produce side-by-side French-door refrigerators. (Reforma, July 21, 2021)
  • Natural gas: U.S. energy infrastructure developer New Fortress Energy (NFE) is nearing completion of a new terminal for the importation of Liquid Natural Gas (LNG) in the northwestern state of Baja California Sur, the company reported. The facility, originally estimated to require investment of approximately $US184 million, will supply local consumers including the national electricity utility Federal Electricity Commission (CFE). (La Jornada, July 19, 2021)
  • Hotels: S. hotel operators Wyndham Hotels and Resorts is projecting it will open five new resorts in Mexico including investment of US$200 million in Mexico City development, the company reported. The market expansion will include a new luxury resort in the northwestern Los Cabos tourism area. (Centroamérica en 7 días, July 12 – 18, 2021)
  • Automotive: U.S.-owned plastic components manufacturer NYX Mexico Plastics reported plans to construct a new production plant in the northern state of Coahuila. The US$25 million site is expected to produce plastic parts for door panels, central consoles, glove compartments and other automotive interior components. (Dinero en Imagen, July 15, 2021)
  • Solar power: Mexico’s national utility the Federal Electricity Commission (CFE) announced plans to construct a large-scale solar energy generation park in the northwestern state of Sonora in conjunction with the state government. The US$1.7 billion project is projected to have capacity of 1,000 MW and will be offered to contractors via international tender. (El Financiero, July 13, 2021)
  • Telecommunications: Mexican telecommunications multinational América Móvil reported plans to invest approximately US$8 billion this year across operations. Resources will support expansion of subscription television coverage and implementation of 5G technology, among other initiatives. (Milenio, July 14, 2021)
  • Solar power: The Mexico City municipal government announced plans to install photovoltaic solar panels on the roof of the city’s colossal central wholesale food distribution market, the Central de Abasto. The US$25 million project will consist of approximately 36,000 panels and is projected to have initial capacity of 18 MW.  (International Energy Agency, July 13, 2021)
  • Coatings: Mexican metal coating and finishing services provider Aminsa inaugurated a new plant in the central state of Aguascalientes. The US$4 million facility will provide electrophoretic painting (e-coating) services to area industries. (Innovación Económica, July 8, 2021)
  • Aluminum: Mexico’s Grupo Vasconia industrial group reported plans to establish a new aluminum plant in the eastern Gulf state of Veracruz. The estimated US$50 million facility is expected to provide aluminum to help the group’s industrial products division capitalize on growing demand under the new USMCA North American free trade agreement. (El CEO, July 8, 2021)
  • Manufacturing: U.S. electrical components maker Sensata Technologies inaugurated a new laboratory for the testing of tire pressure measuring sensors in the central state of Aguascalientes, the company announced. Overall investment of US$10 million will include a new plant to produce contactors for electric vehicles. (Cluster Industrial, June 29, 2021)
  • Automotive: French metal components multinational Le Bélier initiated construction of a new manufacturing plant in the central state of Guanajuato, local media reported. The US$68 million facility is expected to produce molded aluminum automotive components and include a foundry school. (InvestInMX, June 29, 2021)
  • Food processing: British consumer goods multinational Unilever is projecting Mexico investment of approximately US$275 million over the next three years to increase production of manufactured goods for export. Efforts to boost output will focus on processed foods, in particular ice cream. (Today in 24, July 1, 2021)
  • Food processing: Irish food and beverage ingredients maker Kerry inaugurated a new manufacturing plant in the central state of Irapuato. The amount of investment was not specified for the plant, which will produce flavoring ingredients for products such as beverages, snacks, meats, dairy products and baked goods. (Somos Industria, July 1, 2021)
  • Automotive: Sweden-based automotive safety systems maker Autoliv will build a new manufacturing plant in the central state of Aguascalientes, the company reported. The US$35 million factory is expected to produce advanced steering systems beginning in 2022. (Somos Industria, July 1, 2021)

POLITICS AND SOCIETY

  • Mexican Foreign Relations Minister Marcelo Ebrard announced Mexico’s intention to reestablish diplomatic relations with North Korea. Mexico suspended relations with North Korea under the previous presidential administration. (La República, July 19, 2021)
  • Mexican President Andrés Manuel López Obrador (AMLO) announced the forthcoming creation of a new state enterprise to sell tanks of LP gas direct to consumers. The move is the latest in an ongoing series of moves by the AMLO administration to wrest Mexico’s energy industry from the private sector and place it under state control.  (El Universal, July 8, 2021)

Leave a Reply

Your email address will not be published. Required fields are marked *