Virtual Trade Mission to Mexico December 12, 2011 Michael Winter Senior Program Analyst, Federal Transit Administration Jeff Wharton President, IMPulse NC LLC Chair, APTA Business Member International Business Development Subcommittee Alicia Herrera Senior Commercial Specialist, U.S. Commercial Service, Mexico Keith Eischeid Country Manager, Mexico and Central America, U.S. Trade and Development Agency

PASSENGER TRANSPORTATION PROJECTS IN MEXICO ALICIA HERRERA Commercial Specialist for Passenger Transportation U.S. COMMERCIAL SERVICE MEXICO Mexico City/Mexico

U.S. Commercial Service Agency of the U.S. Department of Commerce Focusing in supporting exporters of U.S. products & services Different programs to help U.S. companies in identifying potential distributors or representatives Market research International Delegations to U.S. shows 107 offices in the U.S. Presence in almost all countries in the world Buyusa.gov/mexico

The Mexican Market • Mexico is the United States’ 3rd largest trade partner and 2nd largest export market for U.S. products • Mexico’s population is over 112 million people with 74% urban; 44% under 20 years of age; 23% wealthy/upper middle class; and 37% middle class, and offers a large market with a GDP of approximately USD $1 trillion. Per capita income is $13, 800 • Abundant market opportunities for U.S. firms • Mexico uses many U.S. technical standards Geographical proximity makes easy to be in contact, negotiate and follow up

Mexican Transportation Systems Urban transportation organization is decided by each state 31 states and one Federal District Most states have a mixed organization with public and private transportation systems Private organizations must obtain a concession to operate and manage certain routes or transportation systems Multiple micro-concessionaires that operate 1-5 transportation units Most states are in the process of modernizing transportation systems and replacing old units

Mexico City Metropolitan Area (MCMA) Comprises Mexico City and several municipalities of the State of Mexico 19.2 million people in 7,815 square kilometers 23 million passenger/trips per day 80 % use public transportation and 6 % use private cars Average of 4.5 million cars circulating daily One public transportation unit per 132 private cars Transportation systems connect Mexico City with different regions of the States of Mexico and Morelos

Mexico City’s Transportation Systems Mexico City has a mixed transportation structure: Public systems: Subway system (METRO) : 177 kilometers, 11 lines and 175 stations. Moves 1.4 million passengers per day RTP or Bus System : 1475 buses, 3422 drivers, covering 101 routes STE (trolleys) : 383 trolleys, 20 light trains , 11 routes over 460 kilometers Metrobus : three BRT routes, 67 kilometers, 290 articulated buses , moving 620 ,000 passengers per day Private transportation systems: - 25,000 units including buses and micro buses - 108,000 taxis

State of Mexico’s Transportation Systems All private, operated by multiple concessionaires 30,000 buses and micro-buses operated by 119 different groups 116,000 taxis Suburban Train: - Inaugurated in July 2008 - 27 kilometers connecting several towns in the State of Mexico to the subway and bus transfer station in Mexico City - Operated by the Spanish company CAF

Important projects in Mexico City Subway Line 12 currently under construction: - 24.5 km, with 20 stations - Estimated investment of US $ 2 billion in infrastructure and 1.2 billion in equipment RTP: pilot programs with hybrid buses. STE: two “zero emissions” routes of trolleys: 54.6 km. and 49 stations, with 150 trolleys Project in the bid process for building infrastructure Replacing 194 trolleys between 10 and 30 years old Metrobus: two more BRT corridors in the next two years. Possibilities for hybrid units

Projects in other states State of Mexico: Two more suburban trains Replacing 1000-1500 micro-buses per year More BRT corridors. One articulated bus will replace 4-5 micro-buses All new units will need to be diesel operated and include GPS & GPRS systems, panic buttons, automated passenger counters and vehicle monitoring systems

Projects in other states State of Nuevo Leon: New Subway system lines in Monterrey Several BRT corridors using the best technologies. They will start with 80 articulated low bed buses. Opportunities for urban equipment, street furniture, IT systems, hybrid buses and related products State of Jalisco: Pilot program with 10 hybrid buses. Plans to buy 100 more Security and monitoring systems for the night transportation services Automatic systems for fare collection , passenger counting, fleet monitoring and management, and GPS

Projects in other states State of Puebla: Will open concessions for four BRT corridors in the City of Puebla. Plans to start with 45 articulated high bed buses. In the bid process for building infrastructure for fist corridor Will need automatic fare collection systems, security systems, and fleet management and monitoring systems Many other states have also important projects to modernize their transportation systems Opportunities to sell parts to bus manufacturers in Mexico

Trends and Best Prospects More BRT systems Substitution of old units Use of simulators More automated systems for fare collection, fleet monitoring, maintenance managing, passenger information and others that can improve services and save money to operators Use of security and CCTV systems Better signaling systems Strict control of emissions and polluting sources Use of electronic advertisement and entertainment systems.

Procurement Public institutions must comply with regulations: Purchases under US$3,100 awarded directly to selected providers Purchases over that amount must be through public tenders Private concessionaires: Select suppliers by requesting quotations Decide a purchase based on price, financing and delivery conditions  

How to do business in Mexico Having a Mexican distributor/representative Spanish speaking technical staff Inviting potential clients to visit manufacturing facilities in the U.S. Adapting to market conditions/being flexible Getting familiar with Mexican culture Time to follow up and make presentations to different levels of decision makers

Sources of Information Mexico City: www.setravi.df.gob.mx www.stc.df.gob.mx www.ste.df.gob.mx www.metrobus.df.gob.mx www.rtp.df.gob.mx Some states: www.portal2.edomex.gob.mx/stransporte www.st.pue.gob.mx www.nl.gob.mx/?P=cons_transporte www.jalisco.gob.mx/svt

FOR MORE INFORMATION Thanks!!!!!!!! U.S. Commercial Service Mexico Alicia Herrera Senior Commercial Specialist Tel: (011-52-55) 5140-2629 Alicia.herrera@trade.gov Buyusa.gov/mexico Thanks!!!!!!!!

USTDA: Advancing U.S. Exports to Mexico Keith M. Eischeid Country Manager, Mexico and Central America U.S. Trade and Development Agency APTA Virtual Trade Mission to Mexico December 12, 2011

Key Points USTDA helps U.S. companies expand their international footprint. USTDA helps U.S. transportation companies create jobs through the export of U.S. technologies and services. USTDA prioritizes the transportation sector. Mexico is a priority market for USTDA support. www.ustda.gov

USTDA’s Mission Helping companies create U.S. jobs through the export of U.S. goods and services for priority development projects in emerging economies. Linking U.S. businesses to export opportunities while creating sustainable infrastructure and economic growth in partner countries. The U.S. Trade and Development Agency’s mission is based on two central principles: Supporting sustainable infrastructure and economic growth in partner countries Helping companies create U.S. jobs through the export of U.S. goods and services for priority development projects in emerging economies www.ustda.gov

Regions www.ustda.gov East Asia and Eurasia Middle East, North Africa and Europe South and Southeast Asia Latin America and the Caribbean Sub-Saharan Africa www.ustda.gov www.ustda.gov

USTDA Highlights Independent agency of the U.S. Government, established in 1981. USTDA invested over $44 million in grants and contracts in FY 2011. USTDA has facilitated over $40 billion in U.S. exports to emerging markets. Key number: $1 to $58 (export multiplier) www.ustda.gov

Inter-Agency Cooperation USTDA coordinates with other USG agencies to carry out our assistance: Trade Agencies: Commerce Dept., SBA, USTR Technical Agencies: DOT, FAA, DOE Finance Agencies: Ex-Im Bank, OPIC Foreign Aid Agencies: State Dept., USAID, MCC www.ustda.gov

National Export Initiative NEI was launched in 2010, with the goal of doubling of U.S. exports by 2015. Increased Trade Advocacy USTDA Launched the International Business Partnership Program As you probably know, President Obama recently launched the National Export Initiative with the challenge of doubling U.S. exports over the next five years. As a member of the Export Promotion Cabinet, USTDA is working hard to realize these goals of increasing trade and expanding international business partnerships. President Obama Announcing the Export Promotion Cabinet as part of the National Export Initiative www.ustda.gov

USTDA by Sector: FY 2006 – FY 2010 www.ustda.gov

USTDA Activities How We Accomplish Our Mission International Business Partnership Program Reverse Trade Missions Conferences & Workshops Project Development Program Feasibility Studies & Pilot Projects Technical Assistance As USTDA carries out its program, we work to match U.S. commercial interests with overseas development opportunities through: International Business Partnerships, including Reverse Trade Missions, Conferences, and Training Grants; and Project Development, including Feasibility Studies, Pilot Projects, and Technical Assistance www.ustda.gov

Reverse Trade Missions USTDA brings foreign project sponsors to the United States to gain exposure to U.S. products and services. Examples from Mexico: Multimodal Transportation RTM Intelligent Transportation Systems RTM March 11-22, 2012 Business Briefing Brazil ITS Delegates at the Utah State Traffic Center October 2011 Each year, USTDA sponsors numerous reverse trade missions, bringing foreign project sponsors to the United States to gain exposure to U.S. products and services. USTDA funded a reverse trade mission in October 2010 to familiarize Mexican government officials and Mexican companies with U.S. multimodal terminals and related U.S. technologies and equipment. The development of multimodal transportation corridors in Mexico would support more efficient trade-related transportation in Mexico. Met with. Exports. The third of three visits to be carried out as part of USTDA's Intelligent Transportation Systems Initiative for Latin America, this Reverse Trade Mission will be comprised of leading Mexican private and public sector decision makers in the ITS field. The goal of the initiative is to familiarize senior Latin American officials and project sponsors with U.S. technologies and best practices with respect to intelligent transportation systems through three separate visits to the United States for delegates from Brazil, Colombia, and Mexico, respectively. Each visit schedule will include meetings with U.S. industry, financial institutions, and U.S. government agencies to exchange information with regard to the commercial, technological, regulatory, and financial aspects associated with intelligent transportation systems. For example, USTDA will host a 10-day Reverse Trade Mission that will bring Mexican government officials to the United States to meet and discuss business opportunities with U.S. ITS technology and equipment providers in California, Nevada and Washington, D.C. in March. www.ustda.gov

Conferences and Workshops Highlights near-term infrastructure projects. Introduces U.S. company representatives to senior officials responsible for project implementation. Example from Mexico: U.S. and Mexico: Building Partnerships in Infrastructure Conference In addition to sponsoring reverse trade mission like the one I just described, USTDA sponsors conferences and workshops, which also introduce foreign project sponsors to U.S. business and leading U.S. products and services. The “U.S. and Mexico: Building Partnerships in Infrastructure” conference was held in Mexico City in 2008 to highlight priority infrastructure projects in Mexico. The projects were selected from the list of 300 projects within Mexico’s National Infrastructure Program. The conference highlighted projects in the transportation, energy, and environmental sectors that have potential for advancing Mexico's economic development and improving commercial competitiveness. So far, USTDA has tracked $17 million in U.S. exports linked to the conference. www.ustda.gov

Feasibility Studies Infrastructure Project Assessment Technical Financial / Economic Legal / Regulatory Environmental Pilot Projects USTDA project development activities provide the evaluation and analysis necessary for projects to move forward and receive financing. In December 1998, USTDA approved a grant of $240,000 to Transportación Ferroviaria Mexicana, S.A de C.V. (TFM). TFM, a private operator of the North East Rail Line in Mexico, proposed to develop an intermodal system consisting of a network of terminals that would be strategically located near markets and closely integrated to one another through interconnecting line haul links. The terminal network plan was founded on the concept of integrated, multi-user regional and local hubs that would be connected to one another by scheduled, dedicated or express train operations. The proposed terminals would be well positioned to expand TFM's steamship and domestic volumes, as well as NAFTA trade. The proposed sites included Monterrey, San Luis Potosí, Querétaro, Nuevo Laredo, and Toluca. Export potential for this project was estimated at $32 million, with possible exports of overhead cranes, forklifts, hardware and software, and track materials. The prime contractor, Hanson Wilson, submitted a final draft of the feasibility study in 2001. Recorded $156 million in exports. For example, USTDA provided a $427,861 feasibility study grant to assist the City of Tijuana and SNL Logistics, S.A. de C.V., in the design and development of the proposed Tijuana Intermodal Terminal in northwest Mexico. USTDA’s support of this project is in line with bilateral efforts to support the development of physical infrastructure and overall regional competitiveness. For example, USTDA funded a study to. Results: Pilot projects: 1) Demonstrate U.S. sellers’ goods and services. 2) Provide analysis and evaluation needed for future projects to secure funding. Examples from Mexico: Northeast Rail Intermodal Tijuana Intermodal Terminal www.ustda.gov

Technical Assistance Development of sector strategies, industry standards, and legal and regulatory regimes that are necessary for successful project implementation. Helps a country adopt market-opening policies and procedures that promote a favorable business and trade environment. Examples from Mexico: SCT Multimodal National Plan National ITS Architecture USTDA funded a $1,323,900 technical assistance grant to assist Mexico's Secretaría de Comunicaciones y Transportes (SCT) in the development and deployment of a comprehensive national plan for modernizing Mexico's multimodal trade transportation infrastructure. Implementation of this technical assistance will promote trade competitiveness in Mexico by advancing efficiency and investments in vital trade transportation links throughout the country. Mexico ITS Architecture TA for SCT. In 2003, USTDA approved a $431,000 grant to provide technical assistance (TA) surrounding a trade capacity building project for the Secretariat of Communications and Transportation (SCT) of Mexico. The assistance was designed to support the development and implementation of SCT’s planned National Intelligent Transportation Systems Architecture, and would integrate the resulting system with existing transportation architecture. U.S. export potential was estimated to exceed $100 million in materials and services related to intelligent transportation systems. Wilbur Smith Associates completed the TA in 2006. www.ustda.gov

Requesting USTDA Funding: How to Work with USTDA No formal application procedure, guidelines can be found at www.USTDA.gov. Requests can be made year-round. Requests can come from a local entity or a U.S. company working with a local partner (sole source). Public and private overseas enterprises are eligible for assistance. www.ustda.gov

USTDA’s Funding Criteria USTDA evaluates project proposals based on the following criteria: Developmental priority in the partner country. Likelihood of receiving implementation financing. Mutual benefits for the United States and partner, including commercial and export opportunities for U.S. firms. USTDA evaluates projects for funding support based on the following criteria: 1) Whether the project is a developmental priority for the project sponsor and host country; 2) The likelihood that the project will receive implementation financing; and 3) Whether the project offers mutual economic benefits for the United States and Mexico, including opportunities for commercial cooperation with U.S. firms. www.ustda.gov

Using USTDA’s Resources Visit our website at www.USTDA.gov Check current business opportunities with USTDA and our overseas grant recipients. Sign-up for our eNewsletter to learn about our upcoming events. Obtain copies of USTDA-funded studies. I encourage you to visit our website to check current business opportunities around the globe and upcoming events here in the U.S. On our website you can also see examples of past projects and sign up for automatic updates. www.ustda.gov

www.USTDA.gov Our website, USTDA.gov, is the best place to find up to date information about opportunities to get involved. “USTDA Events” is a great first stop to find upcoming reverse trade missions or business briefings that will be bringing prepared overseas buyers to the U.S. to learn about goods and technologies in your industry. Additionally, you can: Perform a feasibility study or definitional mission, by looking at contract opportunities with USTDA Find viable project opportunities with demonstrated export potential, by working with our grant recipients

USTDA Country Manager for Mexico Contact USTDA Main Office: Arlington, Virginia Telephone: (703) 875-4357 Fax: (703) 875-4009 Website: www.USTDA.gov Keith M. Eischeid USTDA Country Manager for Mexico KEischeid@ustda.gov Thank You! www.ustda.gov

APTA Program Manager – International Programs Gracias! Additional Questions? Please contact: Julia Walker APTA Program Manager – International Programs JWalker@apta.com +1 (202) 496-4833