Mexico’s Military Projects Lose MX$5.6 Billion, Rely on Subsidies

In their first year of full operation, six major Mexican infrastructure and transport projects managed by the country’s military reported combined operating losses totaling MX$5.6 billion (US$337 million). According to an analysis by El Financiero based on financial statements of companies overseen by the Ministry of National Defense (SEDENA) and the Navy (SEMAR), these parastatal firms generated only half the revenue needed to sustain their operations without government support.

The projects include the Felipe Ángeles International Airport (AIFA), Tren Maya, the newly relaunched Mexicana de Aviación airline, the Olmeca-Maya-Mexica Airport-Railway-Tourism Group (GAFSACOMM), the Isthmus Railway, and the tourism initiative in the Islas Marias. Among these, only AIFA and the Islas Marias tourism program reported positive net results, with profits of MX$290 million and MX$3 million, respectively.

Tren Maya recorded the largest operating loss at MX$2.56 billion, followed by GAFSACOMM with a MX$1.4 billion loss. Mexicana de Aviación reported a first-year loss of MX$1.25 billion, while the Isthmus Railway operated at a deficit of MX$633 million.

The combined daily loss rate of these military-managed enterprises reached MX$15 million. To cover the shortfall, the federal government allocated MX$20.99 billion in subsidies in 2024, effectively compensating for the losses. Tren Maya received the largest share of these subsidies.

The military’s increasing role in managing civilian infrastructure projects was a hallmark of former President Andrés Manuel López Obrador’s administration. However, these projects have yet to achieve financial self-sufficiency and remain heavily reliant on public funding.

“No company anywhere in the world that operates passenger services in a railway system is profitable. That is the reality. That is a fact,” said Óscar Lozano, Director General, Tren Maya, during an event hosted by the Mexican Railway Association (AMF).

He added, “This is why the Mexican state has committed to ensuring the continuation of passenger transportation. And how can it do that? By contributing resources. To reach the break-even point, we need to begin cargo operations.”

Lozano projected that profitability might not be achieved until 2030, contingent on expanding cargo operations alongside passenger services.

GAFSACOMM, which oversees diverse services including hotels and parks, also posted significant losses. While no detailed breakdown of its revenue streams was disclosed, its MX$1.4 billion deficit highlights the challenges of consolidating varied operations under a single administrative structure.

Mexicana de Aviación, relaunched under military control in 2023, aimed to expand regional connectivity and offer affordable flight options. However, the airline fell short of revenue expectations and required substantial government support to remain operational.

The Isthmus Railway, part of the broader Interoceanic Corridor of the Isthmus of Tehuantepec, is a key logistics project designed to provide a trade alternative to the Panama Canal. However, its first-year losses of MX$633 million reflect early operational challenges.

Although the Felipe Ángeles International Airport reported a modest profit, its overall viability remains under scrutiny due to low passenger volumes compared to Mexico City’s primary airport. Meanwhile, the Islas Marias tourism initiative—focused on converting a former prison site into a tourist destination—registered a marginal profit of MX$3 million.