Episode 28: Organized Crime Groups Are Attacking Cargo Trucks In Mexico
On this episode of THE MODERN MEXICO PODCAST, host Nathaniel Parish Flannery speaks to BLOOMBERG journalist Maya Averbuch about the problem of cargo truck hijacking in Mexico.
Mexico is now considered to be the world's worst hotspot for cargo truck hijacking with over 100,000 violent in-transit robberies occurring over the last five years. These incidents have resulted in billions of dollars of losses over the last decade. Companies including GM, Coca-Cola, Wal-Mart, Amazon, and Philip Morris have all been affected.
Cargo truck hijacking has become a major problem in Mexico.
During President Claudia Sheinbaum’s administration, Mexico has a unique opportunity to encourage foreign investment in manufacturing.
Many cities in Mexico are experiencing a boom in new industrial investment. But, foreign executives managing new facilities and operations in Mexico are discovering that Mexico presents some unique challenges when it comes to dealing with organized crime.
According to the Global Organized Crime Index, Mexico is ranked as the world’s third worst country in terms of organized crime.
For the last 20 years the generally accepted explanation has been that organized crime in Mexico typically tries to avoid messing with foreign manufacturing companies.
For the most part, criminal groups have largely avoided kidnapping foreign executives or trying to extort companies operating factories.
But, there is one type of crime that does directly impact foreign companies: cargo truck hijacking.
Many remote stretches of highway in Mexico have become major hotspots for violent cargo robberies.
On this episode of THE MODERN MEXICO PODCAST host Nathaniel Parish Flannery talks to agave spirits expert and author David Suro about Mexico’s booming mezcal and tequila industry.
Mezcal is an absolutely fascinating product. It connects some of the most isolated, rural, mountain communities in southern Mexico with consumers in the most sophisticated urban bars and restaurants in the world.
There are some parallels with single origin organic coffee in that respect but within the world of spirits, mezcal is pretty unique.
Whereas some premium spirits such as high end vodka have garnered attention largely through successful marketing mezcal is a product with an incredibly complex history and flavor profile.
It’s unique aromas and taste are derived from the flavors of the wild agaves that used to make it, from the soil, and from the wood used to roast the agaves in underground ovens.
Most mezcal is still made using traditional processes including crushing the agave with a horse-driven stone wheel called a tahona and letting it ferment in wooden barrels.
Many stills continue to be heated with firewood rather than modern technology.
And, the end result is an incredibly unique product that absolutely deserves to be considered as one of the most complex and sophisticated drinks on the planet.
Tequila, on the other hand, has modernized and mechanized and is now produced on an industrial scale in the state of Jalisco.
Mexico’s exports of mezcal and tequila have surged over the last ten years and both industries are now going through some growing pains.
When it comes to mezcal 93% or around 19 out of every 20 bottles is made by small craft distillers.
The production totals of mezcal are absolutely tiny in comparison to tequila.
Total, mezcal production in Mexico tallies up to about 2% of the annual output of tequila.
For every bottle of mezcal that Mexico makes, the country produces 49 bottles of tequila.
Mezcal and tequila production techniques are different but both industries face serious constraints such as problems securing a stable supply of agave.
Despite the industry's immense profitability many workers in Jalisco and Oaxaca are still underpaid.
Check out the full conversation to hear David Suro, one of the co-authors of a new book called AGAVE SPIRITS: THE PAST, PRESENT, AND FUTURE OF MEZCALS, share his perspective.
"Agave is not like grain or sugarcane or grapes where we every year we have new crops. In the case of mezcal a lot of the species of agave, they are plants that need 15, 20, 35 years to develop. But, the growth of [agave cultivation] in Oaxaca is not at the same pace of demand. So, we are now seeing a lot of species, especially wild species of agave used to produce mezcal, in danger of extinction. Rapid growth [caused] challenges we’ve never seen before," Suro explains.
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Episode 26: Organized Crime Groups Are Threatening Tortilla-makers In Morelos, Mexico
Mexico’s tortilla industry is under threat from organized crime. In the state of Morelos, just outside Mexico City, tortilla-makers are complaining about local organized crime groups threatening and extorting them.
More broadly, politicians and police are struggling to deal with a splintering roster of organized crime groups that are diversifying away from drug trafficking into a variety of new rackets including extorting local business owners, hijacking cargo trucks, and stealing lumber.
One of the biggest challenges Mexico’s President Claudia Sheinbaum will face is whether or not she can improve security and reduce violent crime in places such as Morelos.
On this episode of the podcast, host Nathaniel Parish Flannery speaks to Washington Post journalist Mary Beth Sheridan about her article about how organized crime groups are targeting tortilla makers in Morelos.
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Episode 25: Assessing President Sheinbaum's Security Policies
On this episode of the podcast, host Nathaniel Parish Flannery speaks to Will Freeman, a Latin America expert from the Council on Foreign Relations.
Freeman says he would give President Claudia Sheinbaum's security plan a "C" or "D."
He explains that he thinks Sheinbaum's policies are an improvement over the strategies implemented by former presidents Enrique Peña Nieto and Andres Manuel Lopez Obrador.
He also talks about his recent trip to the state of Tabasco, his assessment of Donald Trump's statements about corruption and organized crime in Mexico, and gives a suggestion for how President Sheinbaum can tackle the problem of "narco politics" in Mexico.
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Episode 24: How Vulnerable Is Mexico To Trump's Tariff Threats?
An intelligent and in-depth discussion of Trump's 2025 tariff threats and what they mean for Mexico's economy.
On this episode of the podcast, host Nathaniel Parish Flannery speaks to Diego Marroquin Bitar, a North America researcher at the Wilson Center, a Washington DC-based think tank.
Diego says that Trump's 25% tariffs, implemented on March 4, 2025, represent a "red light" level of risk for foreign investors considering making investments in Mexico.
He also explains why Mexico's economy is so vulnerable to Trump's bullying.
Exports account for over a third of Mexico’s GDP and over 80 percent of Mexico’s exports go to the US. On the other hand, US exports of goods to Mexico account for only about 1% of the US’s GDP.
Although both countries benefit from cross-border commerce, the relationship is more important to Mexico than it is to the U.S.
But, Diego also gives Mexico's President Claudia Sheinbaum an "A" for her effort in dealing with Trump so far.
To many observers it still seems like it’s still unclear if Mexico can really make a deal with Trump.
Are the tariffs just a tactic for bullying Mexico during broader negotiations? Or are we starting an improvised experiment with radically shaking up the global trade system?
“Trump 1.0 used tariffs as a bargaining chip. I think right now more than just a concession extraction tool tariffs are being used to undermine Mexico’s nearshoring potential. I think this is something [Trump and his team] are doing on purpose. They are making manufacturing in Mexico less attractive vis-à-vis the U.S.,” Diego said.
Even before the new tariffs went into effect Mexico’s economy was only expected to grow by around 1 percent.
Executives at foreign companies are going to have to figure out how serious Trump really is about using tariffs as a long-term economic strategy.
In the short-term, this new environment of unprecedented levels of uncertainty in the global economy will hurt investment in Mexico.
The #1 English-language podcast about business and politics in Mexico. On the MODERN MEXICO PODCAST, host Nathaniel Parish Flannery & a diverse group of guests discuss the paradoxes & potential of the U.S.'s most important trading partner. Episodes focus on the intersection between politics, organized crime, and business. Nathaniel has been living in Mexico since 2012 and has written about Mexico for THE NEW YORK TIMES, FOREIGN AFFAIRS, MONOCLE, AMERICAS QUARTERLY, and other magazines. He is now the Director of Research at LATIN AMERICAN LENS, a boutique political risk advisory firm that helps foreign executives successfully navigate Latin America.
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