BNSF Seeks Toehold in Mexico

[CHamilton]

Buffett’s BNSF Seeks Toehold in Mexico as Rivals Tap Boom

When Mexico’s auto production began accelerating in the last decade, Warren Buffett’s BNSF Railway Co. lacked an essential element for winning customers: tracks in the right places.

Union Pacific Corp. (UNP) and Kansas CitySouthern reaped most of the gains as the value of U.S.-Mexico rail trade soared almost 50 percent since 2008. Now, BNSF is trying to grab more business with a new route in partnership with Mexico’s Ferromex to connect the country’s car-assembly heartland withChicago.

The alliance shows how North America’s largest railroad by sales is trying to catch rivals whose lines offer greater access to Mexico. Investment by foreign automakers and other companies is boosting freight volumes, helping increase U.S.-Mexico trade by 5.3 percent in 2014, outstripping the pace of economic expansion in both countries.

 

[Paulus]

I'm impressed that 47% of KCS's revenue comes from Mexico; I wouldn't have expected it to be so high.

 

[Bob Dylan]

BNSF and Warren Buffett will need to be ready to grease the palms of many hands in Mexico, the "Mordida" is the way of life when it comes to doing Business in Mexico no matter what US Law says about bribes in foreign countries! (Wal-Mart's CEO had to resign due to bribes paid in Mexico by the Corporation)

They also will have to reach accommodation with the Drug Cartels that run most Cities and Areas of Mexico!!

 

[tp49]

BNSF and Warren Buffett will need to be ready to grease the palms of many hands in Mexico, the "Mordida" is the way of life when it comes to doing Business in Mexico no matter what US Law says about bribes in foreign countries! (Wal-Mart's CEO had to resign due to bribes paid in Mexico by the Corporation)

They also will have to reach accommodation with the Drug Cartels that run most Cities and Areas of Mexico!!

I've had issues with the Federal Corrupt Practices Act (FCPA aka US law on bribes, but we call them furtherance of business payments.) It's one of the many myriad of regulations that while I agree with the the theory behind it is devoid of any level of understanding of business/governmental relationships in other countries. C'est la vie.