Coca-Cola Announces $5 Billion Investment in Mexico

Coca-Cola Co. (NYSE:KO) will sink more than $1 billion into its Mexican market this year as part of a $5 billion five-year investment plan for the country. Mexican President Felipe Calderon announced the plan after a weekend meeting with Coca-Cola Chief Executive Muhtar Kent in Davos, Switzerland.

The investment will involve an increase in the number of Coca-Cola’s employees in Mexico to more than 100,000 from the current 90,000. An estimated 800,000 jobs are created through the company’s supply and distribution channels.

“Without a doubt, this important investment will boost our economy and will
create more and better jobs for Mexican workers,” said Calderon.

Latin America’s two largest bottlers of Coca-Cola brand products, Coca-Cola Femsa SAB (NYSE:KOF) and Arca Continental SAB are located in Mexico. The country is also home to Coca-Cola’s 14th best-selling brand, Jugos del Valle juices, which has annual sales of more than $1 billion.

Calderon said global companies — especially those dependent on the consumer market — are attracted to Mexico’s expanding economy, increasing per capita income and young population. Last year the country gained approximately 600,000 formal-sector jobs, while gross domestic product grew 4 percent in the first nine months of last year and is expected to have finished 2011 with growth of slightly less than 4 percent. Forecasted economic growth for 2012 is estimated to be around 3.2 percent.