COUNTRY PROFILE
Country profile
MEXICO
and its fast-growing
container glass
industry
Mexico has emerged as one of the fastest
growing container glass industry in the South
Americas in last ten years. Spurred by the growth
in the Mexican non-alcoholic beverage industry
and rising exports to the US, the glass industry has
seen huge investments and capacity expansions
in the last five years. Glass Machinery Plants &
Accessories presents a detailed overview of
the sector and factors spurring its growth in this
country profile.
Rajeev Jetley
M
EXICO’S CONTAINER Mexican container glass industry tion of Vitro’s container glass
GLASS INDUSTRY has been able to register steady business in 2015 and the setting
Comprising of 16 growth rates in the past recent up of three new container glass
container glass producing plants, years. The country’s container plants in the last three years.
with global leader Owens Illinois glass landscape has seen major The Mexican container glass
(O-I) leading the pack, the changes, such as O-I’s acquisi- industry has benefited from the
56 glass machinery plants & accessories 6/2018
TABLE alcoholic beverages
is the largest com-
MAJOR MEXICAN CONTAINER GLASS MANUFACTURERS ponent of container
WITH LOCATIONS AND MARKETS SERVED glass demand in the
Company Location Major segments country.
Owens Illinois Mexico Five container glass plants in Monterrey, In Mexico, a wide
Mexico City, Toluca, Guadalajara and Queretaro Food and beverage variety of alcoholic
Grupo Modelo Three container glass plants in Mexico City,
beverages are con-
San Luis Potosi and Tierra Blanca Beverage industry
sumed, including
some that predate
Sivesa Three container glass plants in Tultilan,
colonial settlement.
San Luis Potosi and Tierra Blanca Beverage industry
Overall, however,
Fevisa Industrial Two container glass plants in Mexicali
Mexicans current-
and San Luis Potosi Beverage industry
ly prefer beer and
Constellation Brands Nava Beverage industry distilled alcoholic
Saverglass Jalisco Beverages, cosmetics beverages, such as
and perfumery tequila and rum.
Vidrio Formas Lerma Food and beverage In fact, beer and
Grupo Pavisa Mexico City Food and beverage tequila account for
the majority of all
alcoholic beverages
overall growth in the domes- export container glass directly consumed in Mexico.
tic economy. Mexico’s economy, and indirectly (through liquor Beer dominates the alcohol-
in fact, has seen unprecedented exports). ic beverage market in Mexico,
macroeconomic stability, which Mexico has transformed itself accounting for more than 80 per
has reduced inflation and inter- from a local spirits market to cent of total sales in this sector,
est rates to record lows while an international beer and spirits in terms of value. Estimated to
increasing per capita income. market in the last decade. The be about MXN 379 billion in
In spite of this, enormous gaps country is a sizable exporter of value terms, the Mexican beer
remain between urban and rural beer, tequila and other spirits to industry is the largest compo-
populations, northern and south- a number of markets, which has nent of demand for the container
ern states, and the rich and the propelled the demand of glass glass industry in the country. In
poor. containers. 2016, Mexico overtook Germany
Mexico’s economy has per- One of the key challenges in beer production to become
formed well compared to other that the Mexican container glass the fourth largest brewer in the
major Latin American economies industry recently had to face world.
in recent years, largely because was rising natural gas prices for Dominated by two major
of its thriving manufacturing sec- most of 2016 and first half of brewers, Grupo Modelo (AB
tor. Unlike Brazil and Argentina, 2017. This rise in price was InBev’s subsidiary, market share
whose manufacturing sectors are mainly caused by pressures due of 57 per cent) and Heineken’s
slumping, Mexico has continued to low production in the coun- Cuauhtémoc Moctezuma (40
to see solid growth because of its try. However, an increase in gas per cent of the market share),
integration with, and dependence imports from the United States the country’s beer production
on, the US market. in the second half of 2017 and
Mexico’s container glass the current year has eased pric-
industry has received great stim- ing pressure.
ulus from its demographic and
geographical position. Mexico, DEMAND DRIVERS FOR
a democracy of 120 million con- THE MEXICAN CONTAINER
sumers, has a great population GLASS INDUSTRY
dividend where the average age All three major segments of
is 25-26 and the population is container glass consumption –
growing along with purchasing food, beverages and pharmaceu-
power. Being located next to ticals – have contributed to the
the United States also creates growth of the container glass
a number of opportunities to industry in Mexico. However,
glass machinery plants & accessories 6/2018 57
COUNTRY PROFILE
Country profile
in 2016 amounted 10.7 billion manufacturer Vitro in 2015 for build upon our position as the
litres, an increase of 8 per cent about USD 2.3 billion. With this world’s leading glass packag-
compared to 2015. transaction, O-I acquired five ing company,” according to Al
The fact that Mexico is the food and beverages glass con- Stroucken, who was chairman
largest global beer exporter has tainer manufacturing plants in and CEO of O-I at the time of
also helped the cause of the con- Mexico, one plant in Bolivia and acquisition.
tainer glass industry. The country the distribution of container glass The company’s plant in
exported USD 3.8 billion worth products in the United States. Monterrey, better known
of beer in 2017. These figures Vitro’s Cosmetics, Fragrances as Vidriera Monterrey S.A.
represent 26 per cent of glob- and Toiletries (CFT) segment, (Vimosa), where its corporate
al beer exports, indicating the the company’s Machinery and offices in Mexico are located, is
strength of Mexican beer exports. Equipment business, as well as the largest O-I plant. O-I’s other
its equity participation in the plants in Mexico are Vidriera
MAJOR CONTAINER GLASS Comegua joint venture, in Central Guadalajara S.A. (Vigusa),
MANUFACTURERS IN America, were not included in Vidriera Los Reyes (Virreyes),
MEXICO this transaction. Presently, O-I Vidriera Toluca S.A. (Vitolsa)
Owens Illinois (O-I) Mexico Mexico’s operations are com- and Vidriera Querétaro S.A.
The largest global container posed of five plants that employ (Viquesa).
glass manufacturer O-I is also approximately 5,600 people.
the largest container glass manu- “As a leader in the strong and Grupo Modelo
facturer in Mexico. O-I entered growing Latin American market, Global brewer AB InBev-
the Mexican container glass the addition of Vitro represents a owned Grupo Modelo operates
industry by acquiring the then significant opportunity to extend three container glass plants in
country’s largest container glass our global franchise and further Mexico. These container glass
58 glass machinery plants & accessories 6/2018
plants are located at Mexico tered in Mexicali B.C., and has of Empaque, was acquired by
City, San Luis Potosi and Tierra been producing glass beverage Dutch brewer, Heineken, in 2010.
Blanca, which are strategically containers for over 20 years. The In 2014, Heineken sold the
placed near the breweries oper- company is a major glass manu- Empaque business to American
ated by the company. These three facturer of beverage containers packaging company, Crown
glass plants are capable of pro- and is a certified and select sup- Holdings for a consideration of
ducing nearly 15 million glass plier to prestigious companies USD 1.225 billion.
containers per day. such as Anheuser Busch, Coca- The company’s contain-
Grupo Modelo is one of the Cola and Modelo Brewing. er glass plants are located at
two major brewers in Mexico. Fevisa Industrial currently has Tultilan, San Luis Potosi and
The company operates seven two plants located in Mexicali, Tierra Blanca in the country.
brewing plants in Mexico with Baja California Norte, and San
a total installed capacity of 60 Luis Potosí, SLP, in which it Saverglass
million hectoliters. The company produces glass containers for French container glass manu-
exports beer to most countries beverages such as wine, beer facturer, Saverglass started up a
of the world. Its export brands and soft drinks, and which are new container glass and finishing
include Corona, Modelo, and exported to several countries in plant in Mexico in June 2018,
Pacífico. Grupo Modelo also the world. The latter serves the its sixth location, to meet the
brews brands intended solely for domestic market, while the for- increased demand for high-end
the domestic Mexican market: mer focuses more on exports bottles throughout the Americas,
Estrella; and León and Montejo. markets. Total capacity of these where customers request a high
plants is 1,500 tons per day. The degree of differentiation.
FEVISA Industrial company currently has approxi- Saverglass specializes in man-
Fevisa Industrial is headquar- mately 1,700 employees. ufacturing luxury glassware used
for wine, spirits, perfume and
Sivesa cosmetics. Saverglass’ manu-
Container glass manu- facturing facility is located at
facturer Sivesa, which now Jalisco. With an installed capac-
operates as a part of US ity of 120 million glass contain-
based Crown Holdings, ers per annum, the site was
Inc., is among the promi- selected based on its conveni-
nent container glass man- ent location for shipping to US,
ufacturers in Mexico. Central America, Canada and
Sivesa, which was a part the Caribbean. O
glass machinery plants & accessories 6/2018 59