Introduction to Chipotle’s Expansion
Chipotle Mexican Grill is coming to Mexico. The California-based chain said Monday it’s planning to open a restaurant in Mexico early next year, its first location south of the border in its 30-year history.
Partnership and Expansion Plans
Chipotle is partnering with Alsea in Mexico City, a company that operates Domino’s, Starbucks, Burger King, Chili’s and other brands in South America and Europe. Alsea plans to explore additional expansion in Mexico and other locations in the region. Nate Lawton, Chipotle’s chief business development officer, said the company is confident that its menu will resonate with Mexican diners.
Market Attractiveness
“The country’s familiarity with our ingredients and affinity for fresh food make it an attractive growth market for our company," Lawton said in a statement. This move is a significant step in Chipotle’s international expansion efforts.
Trade and Tariffs
The expansion arrives as President Donald Trump’s tariffs on Mexican imports could increase costs for U.S. Chipotle locations. Countries across the world have imposed tariffs against the United States in response to the Trump administration’s sweeping tariffs against foreign imports.
Impact on Chipotle
Last week, the U.S. Commerce Department said it plans to withdraw from a 2019 agreement suspending an antidumping investigation into fresh tomato imports from Mexico. That termination, set to take effect July 14, means most tomatoes from Mexico will be subject to a 20.91% tariff. Chipotle gets around half of its avocados from Mexico, but so far those are not subject to tariffs.
Company Overview
Chipotle, which was founded in Denver in 1993, has 3,700 restaurants and plans to open up to 345 new locations this year. It has been focused on growing its international footprint. Last year, it partnered with Alshaya Group to open a restaurant in Kuwait, its first new market in a decade. It now has three restaurants in Kuwait and two in the United Arab Emirates.
Conclusion
Chipotle’s expansion into Mexico is a strategic move to tap into a new market with a growing demand for fresh and high-quality food. Despite the challenges posed by tariffs, the company is confident in its ability to succeed in the Mexican market.
FAQs
Q: When is Chipotle planning to open its first restaurant in Mexico?
A: Chipotle is planning to open its first restaurant in Mexico early next year.
Q: Who is Chipotle partnering with in Mexico?
A: Chipotle is partnering with Alsea in Mexico City.
Q: What percentage of Chipotle’s avocados come from Mexico?
A: Around half of Chipotle’s avocados come from Mexico.
Q: Are Chipotle’s avocados subject to tariffs?
A: No, Chipotle’s avocados from Mexico are not subject to tariffs.
Q: How many new locations is Chipotle planning to open this year?
A: Chipotle plans to open up to 345 new locations this year.
