More Brazilian Companies Increasing Investments in Mexican Market Opportunities

02 Jul, 2024

More Brazilian Companies Increasing Investments in Mexican Market Opportunities

More Brazilian companies are investing in Mexico to access the U.S. market. Frasle Mobility recently acquired a Mexican auto parts manufacturer for R$2.1 billion, marking its largest deal. Gerdau and WEG are also expanding in Mexico, aiming to benefit from nearshoring, which involves relocating industrial operations to neighboring countries. Recent announcements reveal that Brazilian investments in Mexico will add another $900 million, showing a post-pandemic resurgence.

According to the Brazilian National Industry Confederation (CNI), Brazilian investments in Mexico grew 22.9% from 2019 to 2022, reaching $1.2 billion. WEG, operating in Mexico since 2000, is investing R$100 million in a new paint plant, while Gerdau plans a special steel unit with a 600,000-tonne annual capacity and at least $500 million investment.

Mexico's proximity to the U.S. and inclusion in the USMCA agreement increase its attractiveness. Key sectors drawing new investments include the automotive industry, manufacturing, technology, electronics, chemicals, and paints. Companies like Makro and Cushman & Wakefield are leveraging Mexico's strategic location for growth in logistics and industrial facilities. From 2013 to 2022, Brazilian companies announced R$9.4 billion in investments in Mexico.