President Trump’s threats to disrupt trade with Mexico aren’t just worrying people south of the border.
Each time Trump attacks the North American Free Trade Agreement, known as NAFTA, the executives at a 130 year-old railroad company in Kansas City, Mo., hold their breath. Like a lot of U.S. companies, cross-border trade accounts for a lot of Kansas City Southern’s business.
As the trains depart, they head south to Mexico, carrying American corn, chemicals and car parts. When they come back, they’re loaded with items such as refrigerators, finished cars and beer. This is the daily scene for Kansas City Southern trains as they continue the old-school, steel-in-the-ground, heavy industry that was built slowly over decades and centered largely around trade with Mexico.
“They are the NAFTA railroad, so anything that’s going to negatively affect potential trade with Mexico is going to be a negative for Kansas City Southern,” says Jason Seidl, a railroad analyst with Cowen and Company.
Seidl says Trump’s presidency threatens that trade. Trump has targeted the nearly $60 billion trade deficit with Mexico by threatening to punish companies moving production there, and adding a tariff. As he told Scott Pelley on 60 Minutes, he’s taking a hard look at NAFTA.
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