29
NOVEMBER 2013
ACT
MEXICO
REGIONAL REPORT
training employees to perform needed
skills becomes a priority. New business
will be attracted because of improving
labor capabilities.
Velasco’s company provides all relocation
services except for trucking. However,
it arranges and coordinates trucking for
customers.
“We don’t see any economic problems
ahead,” Velasco speculates. “If the U.S.
economy suffers a setback, it would affect
Mexico. It might not be as proportionally
strong, but there would be some impact.”
Increase from Pemex?
Ervin’s Connor says that a Pemex
spending increase might come in 2014’s
first quarter.
“I understand that Pemex needs and
wants to do a lot of upgrading,” he says.
“For us, that would result in a big increase
in heavy hauling.”
Connor speculates that projects would
come on three tiers: direct business with
Pemex; work with energy giants like
Halliburton and Schlumberger that office
in Mexico; as well as mid-size and smaller
companies that serve Pemex.
Since 2004, Mexico’s oil production
has fallen from 3 million barrels a day
to 2.5 million. Part of the problem is
that the government shares Pemex
profits. Reforms might permit Pemex to
assign some of those profits back into its
exploration and production work. That
revenue would spur more projects with
foreign companies that provide equipment
and subcontract drilling-rig operations.
Mexico’s constitution permits partnerships
with foreign companies but prohibits
ownership of Mexico operations.
Matt Hinds, who directs Ervin’s
operations from two suburban Mexico
City locations, remains optimistic.
“Mexico’s congress is considering the
president’s reforms,” Hinds says. “There
will be reforms. We just don’t when they
will come. I don’t expect them all to
happen at once. If some reforms pass in
December and January, there will probably
be more in the months ahead.”
Some have speculated that as
government attempts to diversify business,
there would be less dependence on
Pemex profits. “That would be a good
thing,” Hinds says. “There would be more
profit that Pemex could put back into
exploration and production. That would
mean more opportunities for companies
serving Mexico’s energy business. By 2016,
Mexico hopes to get oil production back
to 3 million barrels a day.”
That hasn’t happened in almost a decade.
“I think the president’s reforms could
spark a business boom in Mexico,”
Tradelossa’s spokesman says. “Fiscal
reforms could be a major improvement.
There would be private-sector incentives
that would change the framework of how
Mexico does its work. Some people think
the approval of these reforms is taking too
long. But right now, all we can do is sit and
wait for them.”
■
a sharp increase in business beyond the
Americas. Business would also perk up for
South Korean, Spanish and other Asian
and European nations doing business in
Mexico.
Mexico’s economic future persuaded AK
Industrial Contractors to create a second
company there. Founded in 1981, the
U.S. company created AK Contratistas
Industriales 17 years later in Monterrey.
Both companies enjoy sustained
prosperity. Little change is on the horizon,
according to Velasco. He commutes
between the U.S. and Mexico. He sees
no interruption in his company’s steady
requests for relocation and reinstallation.
As companies move to Mexico to reduce
costs, Velasco says, “We’ve been able to
fit our skills to the jobs that relocating
companies need. There has been a
consistent demand for our services. We
expect that steady demand to continue
for 2014. We don’t anticipate the peaks
or valleys that we used to experience in
Mexico.”
Velasco identifies one trend that can
generate even more maturity in Mexico’s
economy.
“As regions of Mexico increase their
number of workers and the skills of
those workers, growth will advance in
those regions,” he says. “Growth won’t
necessarily happen just in big cities, which
is the way it used to be.”
When a region or state focuses on
specializing in automotive, paper
manufacturing or aerospace work,
LEFT: Tradelossa hauled an extremely long
and heavy oil refinery chimney from a
manufacturing facility in Monterrey, Mexico
to Tula’s Oil Refinery.
BELOW: Tradelossa’s business has been
strong in 2013 and the company anticipates
more work in 2014, especially if government
reforms are enacted. Reforms could spark a
business boom in Mexico, the company says.
Tradelossa has invested in transportation and rigging equipment to become more competitive
in hauling projects.
