Nearly established investments still flowing south of the border

The Mexican border area is a weekly development of US-Mexico cross-border freight and trade. This week: Inshore investment is still flowing south of the border; Buhler Group plans to build its first facility in Mexico; Frisa opens a $350 million steel plant in Monterrey; and a $90 million logistics center opens near Phoenix.

Despite current uncertainties in global trade relations, Mexico's foreign direct investment (FDI) hit a record $21.4 billion in the first quarter of 2025, an increase of 5.4% from the same period in 2024.

Companies from the United States were Mexico's largest investors in the first quarter, accounting for 38.7% of total foreign direct investment, followed by Spain and the Netherlands.

Investment from the United States and Canada accounts for 42.4% of the total. Manufacturing attracted more than 40% of the country's FDI in the first quarter.

Mexico continues to benefit from a trend around the world that is nearly bus business, especially as companies reconsider their dependence on manufacturing in Asia, said Jordan Dewart, CEO of Mexico.

Mexican Redwood is Chicago-based cross-border transportation unit Redwood Logistics.

“We are starting to see the trend of close relatives in Mexico starting again,” Duvat told FreightWaves in an interview with Freight. “I heard it three times last month, and the company brought some of its supply chains to Mexico. They knew they had to leave China.”

In recent years, the campaign has been a hub for manufacturers who initially sought alternatives in Southeast Asia but viewed Mexico as a more viable long-term solution.

“The short-term solution is to go to Southeast Asia, Vietnam, Cambodia, Thailand, India,” Duwat said. “But now they are rethinking and moving people from Southeast Asia to Mexico.”

Mexico's FDI reached a record $21.4 billion in the first quarter, led by U.S. companies, accounting for 38.7% of the total investment. (Photo: Jim Allen/Freightwaves)

Despite Mexico’s positive momentum, the country’s near-open momentum still faces major challenges, especially security issues, infrastructure demand and trade policy uncertainty.

Eric Baker, a partner at transportation attorney and law firm Frost Brown Todd, said many of his supply chain clients are affected by uncertainty caused by back-and-forth tariffs around the world.

Cincinnati-based Frost Brown Todd has 600 lawyers in 18 states. The company provides advice on supply chain risk management matters.

“I led our supply chain practice group and I was involved in manufacturing people and people who provide transportation services … all are seeing the effects of uncertainty,” Baker told FreightWaves in his acceptance of Freightwaves. “I don't care what business you're in, uncertainty is the bane of any company's existence.”

Baker said that since manufacturers often plan supply chain strategies ahead of time a few years in advance, uncertainty arising from tariffs or any type of disruption can affect long-term investment decisions.

“It’s not easy for manufacturers to implement new supply chain strategies,” Baker said. “When things like tariffs or big schools destroy that supply chain, it’s hard for manufacturers to turn the ship and react quickly because they rely on other manufacturers to provide them with equipment they might need to re-supply chain locally or re-supply chains, especially when you see the environment changes so quickly.”

Most of the big auto companies have adopted a view of waiting for tariffs, but have not significantly changed their supply chains, Baker said.

“My impression is that a lot of OEMs, they’re looking at it from the corner of their eyes,…’Hey, we have to pay attention to that here,” Baker said. “But I really haven’t seen wholesale changes in supply chain strategies.”

In addition to policy uncertainty, Mexico faces challenges such as building the infrastructure needed to adapt to the substantial growth of manufacturing activity, said Jacob Shapiro, research director of the customization group.

Custom Group is an evergreen, Colorado-based wealth strategy company.

“The biggest problem in Mexico will be capacity,” Shapiro told Freightwaves in an interview. “They will be able to build energy infrastructure, and something like this to meet the upcoming energy needs?

Shapiro also said the uncertainty created by the Trump administration could undermine trade confidence in North America and the United States-Mexico-Canada deal.

“The United States enjoys its global position as it is the most trusted and stable force in the world. Now, there are countries and groups that say the United States is no longer reliable,” he said. “In Trump's first administration and Biden's administration, especially in 2020, when the new USMCA is signed, there may be this North American trade group, the United States, Canada and Mexico. I don't know if it has disappeared, but it has been very nervous since Trump's second term.”

Shapiro said that for trade stakeholders, recent trends should be seen as long-term trends rather than short-term phenomena.

“I think we are in a very early stage of near-classification,” he said. “I think it’s a phenomenon that will appear over a decades-long timeframe and ultimately for Mexico, especially for Mexico, and for companies that are leading in noting that.”

Duvat said he is also optimistic about Mexico's long-term prospects.

“Whatever happens, Mexico will be the winner of these trade wars,” Duvat said. “I wouldn't say they triggered the trigger, they're relocating factories, but they're actively asking for quotes, comparing the price of Ocean World with the look of Mexico.”

Buhler Group, a Swiss industrial agricultural equipment manufacturer, recently began building a $24 million factory in Torreón, Mexico.

The plant will create 200 jobs and will perform metal work, equipment assembly and painting. The facility is the Borr Group's first manufacturing plant in Mexico.

Torreón is located in northern Mexico, about 343 miles from Laredo, Texas.

According to the press release, the facility will support the manufacturing needs of Buhler’s cereal and food business and is part of the company’s growth plan in the Americas.

Buhler Group is headquartered in Uzwil, Switzerland. The company has more than 12,300 employees and operates 30 manufacturing locations in more than 140 countries, including 3 factories in the United States

Frisa recently opened a hot rolling steel mill in Monterrey, Mexico.

The $350 million plant has generated more than 450 jobs and has expanded the company's steel production capacity in aerospace, semiconductors, wind and power generation, according to a press release.

Most of Frisa's steel production is exported to customers in the United States along with Europe and Asia.

Frisa was founded in Monterrey in 1971 and has more than 3,000 employees. The company has four steel mills and a distribution center in Mexico, as well as a factory in the United States

NRS Logistics America Inc. recently opened a chemical logistics park in Casa Grande, Arizona, south of Phoenix.

The total investment of the Chemical Logistics Park is $90 million, including a 67,680-square-foot chemical warehouse, a 9,467-square-foot gas station, a container storage yard and tank container maintenance facilities.

The Logistics Center will serve semiconductor and electric vehicle battery manufacturers and suppliers, as well as the industrial chemistry market.

White Plains America, New York-based, is a chemical logic company that provides transportation, storage and distribution, and asset leasing services to the chemical and industrial markets.

NRS Logistics America is a subsidiary of Tokyo-based NRS Corp., an international freight forwarder.

Mexico Postal Post: Nearly construction investments near the south of the border appear first in freight space.