What will Kansas City Southern’s merger mean for railroads in Mexico?

The haunting, fading Doppler effect of a receding train whistle on a hot summer night is romantic, even though it is saying goodbye.

Mexico’s train whistles are tooting hello these days as a good old-fashioned donnybrook is breaking out, now that there are two highly qualified foreign bidders for Kansas City Southern (which holds Mexico’s foreign route concessions).

The first bid, for US $25 billion, came from a Vancouver company, the second US $33.7 billion from a Montreal enterprise. Both bids are tangible support that at some time in the future Canada, Mexico and the United States will be a dominant economic, if not political, entity.

First Coca-Cola and beer — now Dutch, then aviation — now American. And railroads next?

I’m a train buff and have ridden the rails in China and the United Kingdom, as well as Romania, Ecuador, Peru, Czechoslovakia, Canada and, of course, Mexico and Guatemala.

In Mexico, on a trip from California to Mexico City and Guatemala, I even toasted a cheese sandwich on the locomotive’s boiler of the president’s train as I shared the engineer’s cabin with an oilcan-bearing, pinstriped-overalled veteran.

I showed the trackside ragamuffins how to turn Guatemala’s outsized one-Quetzal coin into a mini-Frisbee before we derailed.

Mexico’s President López Obrador is a train buff too, having already pledged that he will retire to his family farm in Palenque, Chiapas, the new loading point for the Refugee Special known unaffectionately as The Beast, which passes north close enough to the United States border to tempt fate.

Enough of nostalgia, except to hope that future train buffs may have the opportunities that I’ve had. On to investment dynamics.

Turning to my eight years as an analyst for investment in Latin America, I’d dismiss the economic risk of investing in railroads in Mexico. Developing nations need railroads.

But this does leave political risk, which is high, not just for Mexico, but for the United States as well. As a recent Reuters article points out, the most recent permitted railroad merger of size in the U.S. was in 1994.

This leaves Mexico, whose distant train history includes a 1930s nationalization of foreign-owned railroads and whose more recent history involves disputing foreign contracts in the petroleum industry.

So, how far does AMLO’S railroad buff-ness go?

Carlisle Johnson writes from his home in Guatemala.

Have something to say? Paid Subscribers get all access to make & read comments.
President Claudia Sheinbaum at her August 6 press conference, with a chart of natural gas consumption, imports and non-conventional (fracking) projected production

Sheinbaum rules out fracking for Mexico’s top shale basin, opens door elsewhere: Thursday’s mañanera recapped

3
Sheinbaum promised Thursday to adopt an expert panel's recommendation to ban hydraulic fracturing in the Tampico-Misantla basin in Veracruz, citing risks to biodiversity, water supplies and densely populated communities.

China’s approval rating in Mexico: Is it a genuine preference or evidence of a bilateral agenda?

5
Mexican adults have a more favorable view of China than they do of the U.S., writes Maria Meléndez, and it's not particularly close. Among younger Mexicans, the gap is even larger.
Sheinbaum Aug. 5, 2026

Sheinbaum addresses murder of influencer in Culiacán: Wednesday’s mañanera recapped

1
César Gastélum is the ninth content creator murdered in Sinaloa since 2024. Sheinbaum said the case was discussed before the mañanera at Wednesday's federal security cabinet meeting, and authorities are working to detain the perpetrators.
BETA Version - Powered by Perplexity