A lack of competition in Mexico’s rail freight sector, which is dominated by Grupo Mexico and Kansas City Southern de Mexico, has resulted in high customer prices, Mexico’s antitrust watchdog said on Wednesday, citing preliminary findings.
The probe, by regulator Cofece’s investigations arm, said miner Grupo Mexico, Kansas City Southern de Mexico , and Ferrovalle control more than 72 percent of the market which allows them to fix prices, restrict supply and impede access to their networks.
Grupo Mexico, which owns Ferromex and Ferrosur, and Kansas City Southern de Mexico together have a 75 percent stake in Ferrovale.
The lack of competition leads to higher logistics costs and longer wait times, which weigh on the economy, Cofece said.
If the full commission votes to approve the findings of the preliminary probe, the railways regulator will have the ability to force through new regulations on the sector.
Full Content: Wall Street Journal
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