Information collected from media reports over the past month:

• Aerospace: American aircraft maker Hawker Beechcraft is joining forces with Mexican executive jet operator Aerolineas Executivas to build a new maintenance facility to serve private aircraft in the northeastern city of Monterrey.  The US$2.2 million project is planned to provide repair and painting services in the country’s second largest private aviation hub. (El Financiero, January 2, 2012)
• Automotive: Japan-based Nissan Motor Co. is preparing plans to build a new automobile factory in Mexico.  The new facility will add production capacity to the company’s two existing plants in Mexico which currently have capacity to produce over 700,000 vehicles a year. (Wall Street Journal, January 6, 2012)
• Automotive: Japanese automaker Nissan announced it will construct a new vehicle assembly plant in the central state of Aguascalientes at an estimated cost of US$2 billion.  The large-scale plan includes a supplier park nearby the new manufacturing facility, which will become Nissan’s third in Mexico. (Autoweek, January 25, 2012)
• Aviation: European aerospace manufacturer Airbus announced an order from Mexican airline Volaris for the purchase of 44 new A320Neo and A320 aircraft. The total value of the deal, planned for delivery 2015 – 2020, was estimated at approximately US$4 billion. (AFP, January 12, 2012)
• Aviation: U.S.-based aerospace manufacturer Hawker Beechcraft announced the sale of six new T-6C+ training aircraft to the Mexican Air Force, with the possibility of additional future orders.  The value of the deal was not specified. (Defense Media Network, January 11, 2012)
• Electricity: German electronics and electrical engineering giant Siemans inaugurated a Low Voltage Research and Development Center near the northeastern city of Monterrey. The company invested approximately US$22 million in the new facility, which will help to develop high efficiency electrical systems for Siemens products. (Reforma, January 13, 2012)
• Retail: Mexican grocery and general merchandise retailer Soriana announced plans to open 50 new sales locations in the country this year.  The company currently operates 558 stores across its five formats. (Reforma, January 16, 2012)
• Logistics: The Mexican affiliate of Philippines-based International Container Terminal Services Inc. (ICTSI) has begun construction on a new container handling terminal at the Pacific port of Manzanillo.  The new facility will require investment of US$250 million.  (Maquila Portal, January 17, 2012)
• Manufacturing: U.S. based safety systems manufacturer IMMI will install a new production plant in the northern city of Coahuila.  The US$49 million facility will produce safety equipment for fire trucks, helicopters, ambulances and other applications. (El Diario de Coahuila, January 13, 2012)
• Aerospace: U.S.-based aerospace manufacturer Ducommun will invest US$6.6 million in machinery and other equipment to upgrade its factory at Guaymas, in the northwestern state of Sonora.  The project includes construction of a new industrial building at the facility, which provides electro-mechanical, sheet metal and composite assembly services. (NAFTA Works, January 2012)
• Logistics: U.S.-based rail carrier Kansas City Southern inaugurated a new rail freight handling terminal in the central State of Mexico.  Built at a cost of US$2.1 million, the terminal is equipped to handle a large volume of liquid cargo. (Info-Transportes, January 20, 2012)
• Aviation: Mexican airlines are projected to acquire 27 new aircraft in 2012, according to financial services firm Actinver.  Airlines expected to add to their fleets include Aeromexico, Interjet, Volaris and VivaAerobus. (Reforma, January 23, 2012)
• Retail: U.S.-based coffee shop chain Starbucks plans to invest US$25 million this year to open 50 additional locations in Mexico, the company reported.  Starbucks projects 24% growth in total Mexico sales this year, based in part on the country’s rising per capita coffee consumption. (El Financiero, January 24, 2012)
• Energy: Spanish bank Banco Santander will provide capital to build four wind farms in northern Mexico, in partnership with German wind energy developer SoWiTec.  The sites, to be built in the states of Nuevo León, San Luís Potosí and Coahuila represent combined capacity of 650 – 850 MW.  The amount of investment was not specified. (Milenio, January 23, 2012)
• Plastics: U.S.-based injection molding firm Century Mold Co. announced plans to build a new production plant in the central state of Queretaro.  The US$15 million facility will supply Tier 1 automotive component manufacturers in the region. (Plastics News, January 17, 2012)
• Retail: Mexican fast food franchise operator Alsea will open an additional 100 locations across its eight brands this year, the company announced.  Brands operated by Alsea in Mexico include Starbucks, Burger King, Chili’s and Domino’s Pizza, among others. (Reforma, January 26, 2012)
• Food processing: The Mexican affiliate of U.S.-based food processing giant Kraft Foods re-inaugurated its research and development center in Mexico City at a cost of US$50 million in technology and skilled staff.  The facility carries out research to improve the quality and development time for new products. (Reforma, January 26, 2012)

Destination unknown

As Mexico City residents slowly returned to work and normal life after the holidays, we discovered we had a garbage problem.  Not just the bags of empty liquor bottles by the door; a real problem for the whole city and surrounding State of Mexico.  The largest solid waste disposal facility used for city garbage was shut down in December, and suddenly the city’s sanitation department wasn’t sure what to do with the garbage.

The dump in question, called Bordo Poniente, was closed with great fanfare on December 19, 2011 after over 25 years of service.  In line with Mayor Marcelo Ebrard’s ongoing effort to implement ecologically friendly public policies, city agencies developed a plan to recycle the site’s estimated 70 million tons of garbage in a number of ways.  According to the plan, the city will issue a tender for private companies to compete for a contract under which the winner will partner with government agencies to build a plant to harvest biogas from the decomposing organic waste.  The gas will be used to generate electricity to help run city services, and/or be converted into fuels for other applications.  In addition to the large scale biogas project, plans also anticipate other uses for the various types of waste once separated, such as compressed blocks to be sold as industrial fuel, recycling of metals and plastics, production of compost from organic residuals and shredding of construction waste to create sand.  The objective is that between the composting of organic waste and recycling of reusable materials, the reduced volume of remaining garbage will be distributed among various smaller waste disposal sites around the greater metropolitan area.  After some 20 years of composting and recycling, the Bordo Poniente site is intended to be converted to green space.  Just the type of ambitious, long-term sustainability planning the city needs to develop and carry through to fruition.

So the future looks promising, but alas, the present is rocky.  Following closure of the Bordo dump, immediate plans to redistribute the city’s daily garbage hit a snag when some local communities organized to block the additional waste from entering their disposal facilities.  As garbage piled up, trucks began dumping the increasing backlog outside the separation centers, in underutilized areas of the Bordo Poniente area itself, and reportedly in irregular dumps elsewhere around the Federal District.  At this writing, the city’s Department of Public Works has admitted it has a thorny problem on its hands but insists a solution is in the works.  We’re hoping they find a way to fast-track that biogas plant.

Read about our participation in the Mexico Today program here.

Information collected from media reports over the past month:

• Telecommunications: Finland-based telecommunications technology provider Nokia Siemens Networks inaugurated a new Service Delivery Center in Mexico City.  The US$2.4 million facility will provide design, planning, optimization and assurance support for telecommunications networks in Latin America, according to the company. (Nokia Siemens Networks, December 7, 2011)
• Metals: U.S.-based metals processor Ryerson Inc. recently opened a new processing center in the northwestern city of Tijuana.  The facility will provide services such as cutting, slitting and laser burning for the area’s large maquiladora and manufacturing industries. (Made in Mexico, Inc., November 7, 2011)
• Aviation: Mexican airline VivaAerobus announced plans to invest US$20 – 25 million in 2012 for the acquisition of five to seven new aircraft.  The company has registered strong growth since its launch in 2006. (Mexican Business Web, December 3, 2011)
• Mining: Canadian mining firm Excalibur Resources announced that it will proceed to develop a major gold and silver production facility at its Catanava mining property in Zacatecas, Mexico, following approval of permits by the Mexican government.  Plans for the development include the construction of office and warehouse space as well as crushing, milling, conveyance and laboratory installations. (Canadian Mining Journal, November 25, 2011)
• Retail: U.S.-based electronics retailer Best Buy announced plans to double the number of its sales locations in Mexico next year.  Best Buy, which entered the Mexican market in 2008, plans to expand from eight to 16 stores in Mexico in 2012. (Reforma, November 29, 2011)
• Automotive: German automotive and electrical components manufacturer Bosch estimated total investment in Mexico of over US$78 million for 2011.  The resources went principally to upgrade machinery and tooling for the company’s 13 production plants in the country, Bosch Mexico president Charles Visconti revealed. (NAFTA Works, December 2011)
• Automotive: Japan-based Neaton Auto inaugurated a new production plant in the central state of Queretaro.  Built at a cost of US$53 million, the facility will manufacture air bags for OEMs Nissan, Honda and Toyota. (Corresponsal del Bajío, November 3, 2011)
• Plastics: Spanish automation components and plastics manufacturer Matz-Erreka inaugurated a new expansion at the plant of its Mexican affiliate Erramex in the central state of Queretaro.  The US$3 million capacity addition will produce precision components for clients such as Valeo, Hutchinson, ZF Sachs and others. (El Financiero, December 5, 2011)
• Energy: Spain-based gas multinational Gan Natural Fenosa announced plans to invest approximately US$65-70 million annually in Mexico over the next 13 years to expand its gas distribution network.  The company seeks to double its existing 15,000 km of pipeline over this period. (El Financiero, December 15, 2011)
• Aerospace: French aircraft component maker Manoir Industries inaugurated a new manufacturing plant in the northern state of Chihuahua.  The US$10 million facility will join the state’s growing aerospace cluster, producing turbine blades and parts for braking systems. (Chihuahuan Frontier, December 1, 2011)
• Manufacturing: U.S.-based Mars company’s Mexico subsidiary inaugurated a new pet food manufacturing plant in the western state of Jalisco.  The US$60 million facility will produce moist food products for dogs and cats. (Excelsior, December 12, 2011)
• Logistics: Danish marine transport group A.P. Moller-Maersk subsidiary APM Terminals will invest US$900 million to construct a new container handling terminal at the Mexican port of Lázaro Cárdenas.  The facility is planned to include 5,000 feet of dock space and an on-dock rail yard. (El Financiero, December 30, 2011)

Read about our participation in the Mexico Today program here.

Plugged in

On the heels of its recently concluded year-long presidency of the United Nations Conference on Climate Change (COP16), Mexico is soldiering on with its sustainability policy blitz.  In late November, the Federal Regulatory Improvement Commission (Cofemer) issued its approval of proposed new regulations under which independent entities generating power from renewable sources may connect to the national electricity grid.  Last year, we reported with great satisfaction that the Energy Regulatory Commission (CRE) had created a contract that allowed independent producers of energy for their own consumption to connect to the grid via a net metering system.    The new regulatory document, under the nimble title “General Rules of Interconnection to the National Electric System for Generators or Permit-holders with Renewable Energy Sources or Efficient Cogeneration,” is intended to streamline the process and lower the overall cost of grid integration for independent producers.  The administrative, legal and technical requirements, formerly distributed among various prior documents published by different agencies, will now be incorporated into the single regulatory document.  The Energy Ministry (Sener) may now publish the new regulations in the Official Gazette, with the hope that facilitating the process will hasten the contribution of new and more environmentally friendly generating plants to the country’s energy supply.  If you feel you must, you can read the Cofemer’s final opinion on the new regulations here (oh go on, we did).

On another front, not content with the success of the incandescent-for-CFL light bulb exchange program we told you about a few weeks back, energy authorities have now hatched a new scheme to promote the use of LED lamps.  Under a pilot program set to begin January 1, 2012 in the Mexico City, Monterrey and Guadalajara metropolitan areas, residential electricity customers in good standing will be able to obtain LED lamps at subsidized prices.  Federal Electricity Commission (CFE) customers will receive an eligibility notice on their electric bill that they can take to selected stores and present in exchange for an LED lighting product, which will be charged to their electric bill at a discounted rate.  Sener is looking to popularize LED technology not only for its energy saving virtues but also with the hope of developing a domestic market appealing enough to attract investment to manufacture the lamps in Mexico.

In the throes of an energy saving frenzy, the federal government also announced last month the creation of a new multi-million dollar fund to assist businesses in replacing older and less energy efficient equipment.  The program, called CFEfectvo, will provide technical evaluations of the energy efficiency of industrial operations and access to subsidized credit for the acquisition of current technology.  Sener has set the lofty goal of achieving energy savings of 30% in the country’s industrial sector through full implementation of the program.

Read about our participation in the Mexico Today program here.

As Mexico’s year-long presidency of the 16th edition of the United Nations Conference on Climate Change (COP16) drew to a close, ProMéxico hosted the Green Solutions conference and exposition November 23 – 25, 2011 in Mexico City.   The event consisted principally of three days of panel discussions on public policy related to climate change, amidst an exposition area featuring innovative products and services aimed at reducing greenhouse gas emissions and overall depletion the world’s natural resources.   The first edition of the Green Solutions conference took place during the COP16 international conference held in Cancun one year ago.

The conference provided an excellent opportunity for those involved or interested in climate change mitigation to exchange perspectives on the outlook for greenhouse gas reduction and learn about projects and initiatives taking place in various parts of the world.  With the COP17 conference kicking off in Durban, South Africa today, at the forefront of discussion is the question of what will happen once the Kyoto Protocol expires at the end of 2012.  The agreement currently establishes ostensibly binding greenhouse gas reduction targets for participating developed nations, and key signatories such as Japan, Russia and Canada are showing little enthusiasm for re-upping once the current period concludes.  

Green Solutions provided a welcome focus on the role of the private sector in the development and implementation of measures to mitigate climate change.  Important players such as Mexican multinational cement producer Cemex and Mexico’s state-run oil and gas monopoly Pemex participated in the forum, sharing their experiences in areas such as strategic environmental planning and carbon credit markets.  Individual panels took on the nuts and bolts of implementing environmental policies in industries such as automotive manufacturing and construction, and others walked participants through project finance and public-private partnerships.

A panel discussion on carbon markets called attention to the uncertain outlook for financing environmentally friendly development through emissions permits.  Between plummeting prices for carbon credits in Europe and concerns over the viability of the market for certificates should the Kyoto Protocol collapse in 2013, an existing source of project finance for Mexico may be at risk.  Mexico has the second largest number of development projects financed by carbon credits in Latin America, according to the Monterrey Technological Institute’s Global Sustainability Institute.  Nonetheless, at least one industry consultant speaking at the panel on carbon markets expressed optimism on the future of the mechanism based on current demand.

Read about our participation in the Mexico Today program here.

A better idea

Mexico’s Energy and Environment Ministries are working to prepare new regulations applying to sustainable housing construction and retrofitting, according to a presentation made by an Energy Ministry (SE) official during the International Forum on Urban Development and Sustainable Reconversion held in Mexico City recently.  The regs will come in the form of a Norma Oficial Mexicana (NOM), or Official Mexican Norm, which is Mexico’s system of obligatory performance and safety standards for some types of products and industrial activities.  The new NOM is planned to establish the parameters within which housing units will be officially considered “sustainable,” based on characteristics such as energy and water efficiency, insulation and waste disposal, among others.  Presumably compliance with the guidelines will be required for housing to qualify for government incentive programs for builders and homeowners intended to stimulate increased energy efficiency.  Residential housing is estimated by the SE to be among the largest consumers of energy in the country, accounting for approximately 19% of power use nationwide.  Officials are targeting early 2012 for completion of the new regulations.

Much like the current municipal government of Mexico City, energy efficiency and ecological themes in general have been a key policy component of the administration of President Felipe Calderón, now nearing the final year of his term.  We have commented recently on public housing agency Infonavit’s Green Mortgage program and new requirements for energy consumption labeling on domestic appliances as examples of efficiency-related public policies.  Over the course of this year, the SE has been gradually implementing a program called Sustainable Light (Luz Sustentable), through which the public may exchange working incandescent bulbs for energy saving CFL bulbs at designated sites set up in grocery stores throughout the country.  The program is intended to help consumers save money on their electric bills as well as cut down on the overall consumption of electricity in homes and workplaces.  Luz Sustentable has set a goal of replacing 22.9 million light bulbs and recently proclaimed surpassing the 6 million mark.  In conjunction with the bulb replacement program, Official Mexican Norm NOM-028-ENER-2010, enacted in December 2010, establishes minimum energy efficiency performance for light bulbs and sets a timetable for the gradual elimination of conventional incandescent bulbs from the market.  Under this regulation, the conventional 100 watt light bulb is set to disappear from Mexican store shelves by the end of the current year.

Read about our participation in the Mexico Today program here.

Information collected from media reports over the past month:

• Retail: USA-based apparel marketer Warnaco revealed plans to open approximately 30 new stores in Mexico over the next two years.  Mexico sales were up by 39% through the first half of 2011 for the marketer of brands such as Calvin Klein and Speedo. (Reforma, August 25, 2011)
• Logistics: Mexican cargo terminal operator Ferrovalle Intermodal announced a US$10 million expansion to its rail cargo handling facilities in Mexico City to be carried out this year.  The addition of 25 developed acres to the terminal will increase annual handling capacity to over 550,000 containers and speed last-mile deliveries. (Reforma, August 1, 2011)
• Entertainment: Mexico City’s largest film studio, Estudios Churubusco, will expand with the construction of a new post-production building.  The investment of approximately US$20 million will include over 30,000 square feet of digital laboratory space, production warehousing and offices. (Reforma, September 6, 2011)
• Infrastructure: Spanish infrastructure developer OHL Group, through its environmental subsidiary Inima, will build and operate a large-scale desalination plant in the northern Mexican state of Baja California.  The US$41 million facility is planned to produce 275 million cubic feet of potable water annually. (Reforma, September 7, 2011)
• Energy: Spanish renewable energy developer Siliken will invest US$20 million initially to build and launch a 100 MW solar power plant in the northern state of Durango.  The project is planned to include a research and development center in addition to generating electricity. (Milenio, September 8, 2011)
• Autoparts: Japanese industrial automation manufacturer Omron Corporation will invest US$30 million to build a new production plant in the central Mexican state of Guanajuato.   The facility will join recently announced new factories to be built by Honda and Mazda in Guanajuato’s growing automotive industry. (El Sol de Irapuato, August 27, 2011)
• Biotechnology: Mexican agricultural biotechnology laboratory Biosustenta inaugurated a new plant to produce biofertilizers in the western state of Michoacán.  The US$1.3 million facility will use mycorrhizal fungi and other bacterias to produce the fertilizers.  Biosustenta currently exports product to the United States, Canada and Europe. (El Financiero, August 30, 2011)
• Infrastructure: Quintana Roo state port authority Apiqroo will oversee the construction of a new cruise ship dock on the tourist island of Cozumel.  The US$40 million terminal is planned to serve the growing traffic of cruise ships to the resort island south of Cancun. (El Financiero August 30, 2011)
• Mining: Mexican mining concern Minera Autlán revealed plans to invest US$300 – 400 million over the next five years in a range of expansion initiatives.  Projects to be carried out include development of a new manganese mine, construction of a new ferroalloys plant and diversification of their manganese products to serve additional industries. (Reforma, September 9, 2011)
• Energy: Spanish energy developer Preneal will construct a wind-powered electricity generation plant in the northern state of Zacatecas, state officials announced.  The US$300 million project is projected to have an installed capacity of 100 MW. (Milenio, September 4, 2011)
• Electronics: USA-based Spellman High Voltage Electronics Corp. inaugurated a new manufacturing and testing plant in the border city of Matamoros.  The US$15 million facility will provide additional capacity for the production of power supplies and X-ray generators as well as testing for Spellman’s other production plants. (El Mañana de Reynosa, August 18, 2011)
• Food processing: U.S.-based PepsiCo is nearing completion of a new Advanced Baking center under construction at the Research and Technology Innovation Park in the north eastern state of Nuevo León.  The US$20 million facility will develop new baked products for the company’s Gamesa and Quaker brands. (Reforma, September 13, 2011)
• Chemicals: Mexican industrial group Grupo Cydsa announced plans to invest over US$100 million to build two new manufacturing plants and expand a third.  The new facilities will produce bleach, caustic soda and other chemical products, while expansion is planned for the company’s existing salt refinery in the Gulf state of Veracruz. (El Financiero, September 13, 2011)
• Retail: Upscale Mexican department store chain Liverpool will invest up to US$450 million to open seven new stores in Mexico in 2012.  Same-store sales rose 8.4% in 1H11 for the leading retailer and mall operator. (CNN Expansión, September 13, 2011)
• Manufacturing: Danish toymaker Lego announced plans to invest US$100 million in its manufacturing plant located in Monterrey, Nuevo León.  The resources are earmarked to expand capacity at the facility, which makes products for the Mexican market as well as for export to the USA and Canada.  Lego sales in Mexico are growing by double digit percentages annually. (El Financiero, September 14, 2011)
• Energy: Mexican energy consortium Baja Sun energy will invest over US$500 million to develop a major complex in Baja California that will manufacture solar panels as well as generate solar electricity.  Investors include Arima Eco Group of Taiwan, joint U.S.-Mexican solar developer Silicon Border and Mexican specialized builders Grupo Maíz. (San Francisco Chronicle, September 12, 2011)
• Retail: U.S.-based DIY retailer The Home Depot announced planned investment of US$260 million in Mexico by the end of 2012.  The resources will support the opening of 13 new stores in the country to reach a total 100 locations. (Reforma, September 22, 2011)
• Pharmaceutical: Mexican pharmaceutical laboratory Landsteiner Scientific began construction on a new research center in the central city of Toluca to be built at a cost of approximately US$37 million.  The site is planned to include facilities for research as well as the production and distribution of medications. (Bolsa Mexicana de Valores, September 20, 2011)

To read about our participation in the Mexico Today program, go here.

• Agribusiness: Mexican agricultural services provider Phytosan inaugurated a new phytosanitary radiation plant in the northeastern state of San Luis Potosi following investment of US$12 million.  The facility, the only one of its kind in Mexico, will be used to treat fruits and vegetables for export to the United States.
• Automotive: Japanese automaker Honda plans to invest US$800 million to build a new manufacturing plant in the central state of Guanajuato.  The new factory, planned to begin production by 2014, will produce energy-efficient subcompact autos. Honda currently operates an automobile factory in the western state of Jalisco.
• Hospitality: U.S.-based hotelier La Quinta Inns & Suites announced plans to invest US$60 million to expand operations in Mexico over the next three years.  Projects are expected to include new hotels in business hubs such as Mexico City, Ciudad Juarez, Reynosa and San Luís Potosí, among other locations.
• Automotive: Japanese automaker Honda will reactive investment plans at its manufacturing plant in the western state of Jalisco.  US$60 million in resources are earmarked to install equipment and technology needed to produce the company’s next model CR-V recreational vehicle.
• Automotive: U.S. auto parts maker TRW Automotive announced it will invest US$50 million to install a new manufacturing plant in the central Mexican state of Queretaro.  The new facility reportedly will produce anti-lock braking systems to supply Volkswagen Brazil.
• Mining: Mexican corporate group GFM has formed a joint venture between its heavy equipment subsidiary GFM Maquinaria and Singapore-based Singapore Technologies Kinetics to market mining equipment under the brand TRXBUILD.  The association plans to build a factory to produce equipment such as backhoes, tractors and off-road trucks in Mexico within five years through projected investment of US$20 million.
• Pharmaceutical: Mexican pharmaceuticals manufacturer Grupo Silanes will invest US$20 million to construct a new production facility in the city of Toluca, near Mexico City.  The plant will produce the company’s Anascorp antidote for scorpion stings, recently approved for sale in the United States by the U.S. FDA.
• Real Estate: U.S.-based real estate developer Bald Mountain Development is preparing to construct a luxury hotel and housing complex in the central Mexican city of San Miguel de Allende.  The US$250 million project may be followed by two similar developments elsewhere in the country, according to the company.
• Aviation: U.S. commercial air carrier Delta announced a US$65 million investment in Mexican carrier Aeromexico in exchange for stock and a seat on the Mexican airline’s board of directors.  The deal includes additional US$20 million investments from each company to expand joint maintenance and repair capabilities in Mexico.
• Steel: Mexican steel industry leader Altos Hornos de México (AHMSA) announced US$493 million in new investment to conclude an ongoing production capacity expansion project.  The steel giant seeks to enhance capability to produce specialized steels for automotive, metal mechanic and other manufacturing industries.
• Retail: Mexico’s ANTAD national retailers’ association announced combined investment of US$3.6 billion by its members projected for 2011.  First half retail sales were up 10.3% in nominal terms and 3.8% for same-store sales this year, the group reported.
• Mining: Mexico’s mining industry chamber Camimex reported its members will invest US$848 million in exploration of new deposits this year.  The record sum is driven in part by surging demand for gold on world markets.
• Logistics: Germany-based courier DHL Express will open 24 new sales locations in Mexico in 2011 at a cost of approximately US$2.5 million, in addition to opening a new gateway site in Monterrey this year.  The expansion is part of a five-year US$125 million investment program for the company’s Mexico operations.
• Infrastructure: Mexico’s Communications and Transportation Ministry (SCT) announced it will issue a tender for road construction in the western state of Michoacan by the end of this year.  The contract package for construction and widening of highways in the state will have a projected value of approximately US$450 million.
• Energy: British oil and gas infrastructure services provider Petrofac announced plans to invest US$200 million in Mexico over the next two years.  Petrofac recently was awarded two contracts by state oil monopoly Petroleos Mexicanos (Pemex) to increase output at mature oil production sites in Mexico.

Read about our participation in the Mexico Today program here.

• Automotive: U.S. auto maker General Motors announced US$900 million in additional investment in Mexico in the coming years.  The resources are planned to expand production capabilities at various of the company’s plants in the country.
• Manufacturing: British-Dutch consumer goods giant Unilever inaugurated a new manufacturing plant in the state of Morelos, near Mexico City.  The US$84 million facility will produce personal care products for the brands Axe, Dove and Rexona.
• Tourism: Mexican hotel operator Grupo Posadas will invest US$140 million this year in new hotel projects in Mexico.  With tourism showing signs of recovery after the long economic downturn, Posadas’ Mexican investment is part of a total US$400 million projected by the company for new projects throughout Latin America.
• Wind power: The Mexican subsidiary of U.S.-based Cannon Power Group revealed plans to invest US$2.5 billion to develop three new wind farms in Mexico.  The newly created Mexico Power group plans generating plants with combined capacity over 300 MW for the states of Baja California, Zacatecas and Quintana Roo.
• Metals: Chilean metals processor Molymet will invest US$135 million to build a new production plant in Sonora, Mexico.  The new plant will add to the company’s existing molybdenum processing infrastructure in the state.
• Food processing: Leading Mexican meat processor SuKarne will invest US$270 million to build a large production facility in the north eastern state of Nuevo Leon.  The project is planned to include livestock raising facilities, a feed plant, a federally certified slaughterhouse, a packing plant, a distribution center and a rail shipping link.
• Paper: Chilean paper producer CMPC will open a new paper bag manufacturing plant in Guadalajara, Mexico.  The US$20.4 million facility is projected to begin operations in early 2012 with annual production capacity of 40,000 tons.
• Construction: Plans for US$ 2.3 billion worth of new office tower construction along Mexico City’s Reforma business corridor were revealed during the World Office Forum conference in Mexico City this month.  At least 13 new towers are slated for construction by 2014.
• Automotive: Volkswagen Mexico invested US$400 million to redesign its Puebla, Mexico plant for the production of the new Beetle model automobile.  The company is projecting output of 100,000 units of the model for next year, principally for export to the United States, Europe and China.
• Retail: U.S.-based grocery and general merchandise retailer H-E-B plans to invest US$23 million in 2012 to capitalize on its strong growth in the Mexican market.  Sales at the chain’s Mexican stores, which currently number 39, were up 12% overall through the first half of 2011.
• Mining: Mexican mining firm Grupo Peñoles inaugurated its new El Saucito silver mine in the northern state of Zacatecas.  Total investment in the new mine and processing plant is estimated at over US$300 million.
• Logistics: Mexican intermodal freight terminal operator Intermodal Mexico will invest US$20 million in infrastructure upgrades to handle strong growth in demand for container management.  Resources are earmarked for container handling equipment, cranes and information management systems.
• Electronics: U.S.-based audio electronics manufacturer Harman is building a new production facility in the central state of Queretaro.  The plant, to be completed next month at a cost of approximately US$75 million, will produce audio systems for automobiles.
• Cosmetics: French cosmetics giant L’Oreal will invest US$50 million in the construction of a new manufacturing plant in the northeastern state of San Luís Potosí.  The new facility, the company’s second in Mexico, is planned to produce hair coloring products for the Mexican market as well as for export to the United States and elsewhere in Latin America.
• Telecommunications: Mexican beverage bottler Coca Cola-FEMSA is investing US$3 million to open a new contact center in the State of Mexico, just outside Mexico City.  The center is planned to handle 10,000 customer service calls daily from the surrounding states.
• Aerospace: British heat treatment specialist Bodycote announced recently it will open a new technical facility in the northwestern state of Sonora.  The plant will provide advanced thermal processing services to aerospace manufacturers in the area. The states of Sonora, Chihuahua and Baja California form Mexico’s largest aerospace manufacturing cluster with over 100 companies between them.

To find out about our participation in the Mexico Today program, please go here.

Oh no

The process of implementing a rule change for product labeling that began last year may mean more work and expense for some importers, but so far it’s a little hard to tell exactly where the process stands.

The new rule, which requires additional information on energy consumption for some electric products, is ostensibly aimed at lowering overall energy consumption to reduce greenhouse gas emissions and help consumers lower their electric bills.  But tracking exactly what is required and when has not been easy.

In September 2010, the Secretaría de Energía published a list of electric appliances for household and commercial uses that will be required to declare the product energy consumption in Spanish on a label directly on the product.  Affected products include vacuum cleaners, blenders, coffee makers, juice extractors, air conditioners, refrigerators, microwave ovens, irons and hair dryers, among others.  The full list of products can be found here.

The new requirements were supposed to be phased in over the following year in two steps.  First, as of April 15, 2011, the required energy information would have to be reported to the Mexican Consumer Protection Agency (Profeco) and the National Commission for Efficient Energy Use (Conuee) via a purpose-designed form.  The April 15 date was later extended by 60 days.  The requirement that products actually be labeled for retail sale with the energy information is planned to enter into effect on September 10, 2011.

For reporting of a product’s energy consumption, the manufacturer or importer is required indicate the methodology used to determine the amount of energy used by each product.  Products for which there are specific Mexican official standards or NOMs must follow the guidelines stated in each specific NOM.  Currently, however, few NOMs apply specifically to electric household products.  For products for which no specific NOMs exist, a detailed methodology used to determine the energy consumption of the product (eg. Energy Star standard, IEC standard, or other) must be attached in its original language.  An example of the application of the methodology used must also be provided, as well as written laboratory test results to prove the reported results are required.

The whole thing sounds rather complicated, especially when taking into account the differences in test results for products tested using Mexican electricity and the current of their countries of origin.  There are, however, consultants in Mexico specialized in leading importers and manufacturers through the compliance process.  If you think you may be affected by the new regulations and would like to know more, drop us a line at info@bdp-americas.com.