Investing in Mexico from an operator’s chair

Investing in Mexico works when the distributor, the customs broker and the plant manager are your market, and fails when the macro story is your market. I learned that selling, not allocating. I held the Miller Beer distributorship for the state of Baja California and the 5-hour ENERGY exclusive for Mexico, and with my partner Sandro Piancone grew a distribution and export company to a hundred million dollars in sales, carrying more than two thousand products into restaurants, bars, hotels and supermarkets across the country. This is what that chair sees that a research note does not.

The headline number is real

As of the first half of 2025, Mexico took in about $34.3 billion in foreign direct investment, the strongest half year on record, according to figures from the Secretaría de Economía as reported by MexicoCRE. Plan México, the federal industrial policy, added a tax incentive that matters to anyone building a plant: immediate depreciation of qualifying assets for investments made between January 22, 2025 and September 30, 2030, plus simplified procedures in fifteen designated industrial hubs, per the same reporting. USMCA makes Mexico the simplest international expansion a North American company can make. None of that is wrong.

What the headline misses is that most of that money is going to places where the grid, the road and the labor pool are already full. The investor’s problem in Mexico is not finding demand. It is finding connected capacity, and the operator who can deliver it. I write about that separately under energy for manufacturing and AI data centers.

Where the money is actually going

The sector mix tells you where the capacity constraints will bite first. One industry tally of announced nearshoring investment, reported by MexicoCRE in December 2025, put automotive at the top with about $27.4 billion, roughly 35 percent of the total, followed by energy at about $19.7 billion, real estate at $10.5 billion and technology at $5.8 billion. Treat that as a directional count, not an official series; the Secretaría de Economía and Banco de México publish the numbers that matter for a model. But the shape is right: the two largest buckets are the one that needs the most connected power per site and the one that supplies it. An investor reading that table should see a queue, not a boom. Whoever shortens the queue, with a substation, a private line or a rented megawatt, gets paid before the plant does. The same reporting notes that several automotive names paused or withdrew announced projects during 2025 and that Mexico stayed the leading nearshoring destination in the Americas anyway. Both halves of that sentence are true, and only the operator’s questions below tell you which one applies to the deal in front of you.

Five things the loading dock taught me

1. The distributor is the market. In the United States a brand can go around the distributor for a while: Amazon, its own site, self-delivered accounts. In Mexico, for most categories, the distributor’s trucks are the only road to the shelf, and the distributor’s credit terms are the real cost of capital. When I ran distribution in Baja, the question that decided every deal was not price. It was who carried the receivable for forty-five days. An investor who does not know who is carrying the receivable does not know the business.

2. Cash moves differently. A large share of Mexican retail is still cash at the counter, and a large share of the retail base is still the independent store, not the chain. That is not a weakness. It is a market that pays on delivery and does not return product. But a model built on chain-store terms will be wrong on both the margin and the working capital line.

3. Compliance is a schedule, not a form. Labels, import permits, sanitary registrations, and the customs broker who knows which port is faster this month. I held the 5-hour ENERGY exclusive for Mexico; the product was not the hard part. The hard part was the eleven weeks between a container landing and a case being legal to sell. An operator prices that schedule into the deal. A spreadsheet does not.

4. The peso is a cost of goods line, not a footnote. Every dollar-denominated input becomes a local price change in a week. The brands that survived in my warehouse were the ones that re-priced monthly and carried margin for it. The ones that failed were the ones that set a peso price once and defended it.

5. Relationships outlast contracts. The same families run the distributors, the brokers and the regional chains for decades. I still do business with people I first delivered to from a van. The investor’s due diligence in Mexico is a list of names and whether anyone on the team can call them.

How to read a Mexican deal as an operator would

When a Mexico opportunity comes across your desk, ask the questions a distributor would:

• Who, by name, carries the product to the shelf, and on what terms?
• What does the regulatory calendar look like from landing to legal, in weeks?
• Which input prices are in dollars, and how fast does the business re-price?
• Who on the team has run an operation there, with payroll and a customs broker, rather than visited?
• What does the local grid, water and road capacity look like at the site, today, not in the plan?

If the answers are specific, the macro story is a bonus. If they are not, the macro story is all you are buying.

Why I still believe in the trade

I work both sides of the border because the arbitrage is real: a North American market with a Mexican cost base and a trade agreement that keeps the two connected. The investors who make money on it are the ones who buy the operation, not the thesis. That is what I write about every week, and it is the lens I bring to the energy company I am advising and to the fund I manage. More on the investing in Mexico hub.

Frequently Asked Questions

How much foreign direct investment did Mexico receive in 2025?

As of the first half of 2025, Mexico received about $34.3 billion in foreign direct investment, the strongest half year on record, according to the Secretaría de Economía as reported by MexicoCRE; full-year figures should be checked against the ministry’s own release.

What is Plan México?

Plan México is Mexico’s federal industrial policy announced in 2025, and as reported it offers immediate depreciation of qualifying investments made between January 22, 2025 and September 30, 2030, plus simplified procedures in fifteen designated industrial hubs.

What is the biggest risk when investing in Mexico?

From an operator’s chair the biggest risk is not political; it is capacity. As of 2026 the binding constraints at most industrial sites are connected power, water and the distributor’s terms, and a deal that has not priced those is a deal that has not been diligenced.

Is nearshoring to Mexico still happening?

Yes. Despite some automotive withdrawals, Mexico remained the leading nearshoring destination in the Americas as of late 2025, per MexicoCRE’s reporting, and USMCA keeps it the simplest international expansion for a North American company.