What’s stopping trains from becoming Mexico’s economic driver
Government and private sector wrestle for joint custody of the unfulfilled golden boy of Mexican transport.
Mexico has some of the most productive advanced industries on Earth. Ford’s two most productive plants are both in Mexico, one in the state of Sonora making Broncos and Mavericks, the other in the State of Mexico churning out Mustangs. The issue comes as soon as these cars roll out the factory door:
Shoddy or saturated infrastructure adds to logistical costs. So do security considerations—companies will either hire private guards or wait to be escorted by the armed forces through criminal choke points around the country. And that’s all before considering that Mexico is currently experiencing a 90,000 truck driver deficit.
Trains bypass all these issues. They have an incredibly low theft rate. A single train moves what 300 lorries can, and they’re 75% less polluting per tonne to boot. Yet rail freight accounts for less than a quarter of what is moved by road.
President Claudia Sheinbaum has made trains a flagship policy. A lot of her government’s emphasis has been put on the revival of passenger rail, but her ambitions extend to cargo. She’s made the sector a target of government policy for the first time in decades with an eye to unlocking much needed economic growth across Mexico.
The president has her work cut out for her. Beyond the vast rugged landscapes of mountainous Mexico, the government’s ambitions are set to be thwarted at every sleeper by the current state of rail’s economics and the politics that surround it.
As usual, at the heart of this tension lies a tussle between the State and the private sector over the best way to run Mexico’s trains, as The Mexico Political Economist found on speaking to a dozen high-level transport officials, top rail executives, and independent railway consultants.
Despite these challenges, the president wants to add 3,000 kilometres of track to the network’s existing 28,864 km. Considering rail has grown by fewer than 10,000 km since the 1910 Mexican Revolution, this is a tall order.
“The past sexenio [six year presidential term] built 1,500 km with the Maya Train and not even all of that is fully operational,” Carlos Sierra, a rail consultant at Ecourba—an independent mobility consultancy—told The Mexico Political Economist. “I’m not complaining about president Sheinbaum’s plans; they just verge on being too ambitious.”
Luckily, the private sector is determined to work with the government. “The president’s vision—I believe her flagship project—is that of passenger trains. We’ve been working very closely with them, above all to ensure that freight can grow in the areas where passenger rail is growing and vice versa,” Óscar Del Cueto, president and executive representative of CPKC de México—one of the two companies that dominate Mexican rail freight in the country—told The Mexico Political Economist. “We want this project to be successful. And in that sense, we’ve been working and collaborating with the whole government.”
So, that might be the end of it! It seems like the public and private sectors have put their squabbles behind them to allow Mexico to at last turn to the monumental task of updating Mexican rail from the 19th to the 21st century. Not so fast…
