Top Mexican Companies Based in Canada
Top Mexican Companies Based in Canada
Canada and Mexico are living a sweet moment in their political, business and cultural relations. The Canadian government’s lifting of visa requirement for Mexican people interested in going to that country has brought about an immediate increase of tourism flights to Canada and new business expectations. The bilateral trade between both countries is nine times higher than it was back in 1994 (when the NAFTA was implemented) and, in the first half of 2016, Mexican exports to Canada went 6.8 percent up, totaling 2,985 million dollars, mainly focused on the sectors related to aeronautics and automaking. In 2015, Mexico’s direct investment in Canada climbed to 1,400 million dollars, while Canada’s direct investment in Mexico went beyond 14,800 million dollars. All in all, the trade balance shows a favorable tendency for Mexico of 1,533 million dollars. Both countries rank third among their respective business partners. Mexico is Canada’s third and most important business partner, right behind the United States and China.
The main materials and products exported by Mexico to Canada are related to machinery and mechanic devices, sound recorders and players, electronic devices and accessories for sound systems. Mexico’s vegetable products are gaining momentum in markets, specifically plants, trees, bulbs, roots, flowers, food oils, fruits and citrus, coffee, spices, cereals, medicine plants and oleaginous fruits. This modification in Canadian markets is one of the most visible consequences of the North American Free Trade Agreement (NAFTA), which has been in force since 1994 and presently faces an uncertain future after the threat issued by the president of the United States, Donald Trump, of renegotiating some of its most relevant aspects. In spite of this situation, analysts believe that the business relations between both countries will continue to grow over the years and several Mexican companies, seeing the legal uncertainty in the United States, are going to set their aim on Canada, a country that precisely offers legal safety, low taxes, political stability, significant technological potential and “friendly” environment for business and startups.
So far, the presence of the main Mexican companies in Canada is still low if compared to the United States, but there are obvious symptoms of changing trends that were already verified in 2014 when Mexican Bimbo, the biggest bakery company on the face of earth, acquired Canada Bread and Vachon, emblematic companies within the Canadian food sector. Along with Bimbo, these are the most important Mexican companies that are currently operating in Canada.
The Bimbo Group, the biggest bakery company on the planet, with presence in 20 countries, entered the Canadian market in 2014 by acquiring Canada Bread and Vachon for 1,830 million Canadian dollars. Bimbo, besides its international presence, has 71.5 percent of its plants based beyond Mexico’s borders, while 61 percent of its incomes is obtained in the countries where it markets its products, such as Chile, Spain, Portugal or China. Its president in Canada, Alejandro Pintado, underlines that his acquisition is framed within a growth strategy that “complements the presence of our brand, production and distribution in the North American continent.”
Alfa is a Mexican industrial conglomerate that owns the biggest independent producer of aluminum for components in the automaking sector, and one of the main world producers of polyester. Moreover, Alfa manages an important package of stocks in Canadian oil company Pacific Rubiales. Nemak, Alfa Group’s division of high-level aluminum components, owns a plant in Windsor (Ontario). Based in Monterrey, it runs operations in 17 countries and half of its plants are managed overseas. In fact, 61.5 percent of its incomes is related to the company’s international operations.
It is the biggest mining group in Mexico and actively participates in North America with its Southern Copper Corporation and ASARCO subsidiaries, both are highly interested in the Canadian mining sector. The head of Global Energy Business Development from Toronto Stock Exchange/ TSX, Monica Rovers, has recently declared that the Canadian stock market can be an alternate funding source for Mexican companies in the energy sector looking for capital to expand their operations. Canada’s stock market is very active in terms of investment and funding for energy companies, and it is a world benchmark in the mining sector. Last year, it collected over 10,700 million dollars in this niche.
Industrias CH is a company devoted to the making of steel products. It manages plants in Mexico, the United States and Canada, specifically in Hamilton, Ontario. Its main production lines, also by means of subsidiary companies, are special types of steel, pipes, market sections, structural sections and rods. The company provides services to such industries as automaking, construction, mining, energy, hand tools, machinery and aerospace industry, which are key sectors to the Canadian productive model.