Transmission Bottleneck: The Global Challenge

Q: What role does Grupo Sisttemex play in Mexico’s energy industry?

A: Sisttemex is a 100% Mexican company based in Queretaro. While the company participates in several sectors along the value chain, its primary focus is the electrical sector, specifically power transmission and distribution, as well as telecommunications.

Within the broader energy space, we have also participated in projects related to power generation and oil and gas, including refineries, fertilizer plants, and combined cycle power plants. However, our core business and the area where Sisttemex has built its deepest expertise is power transmission.

Our key role lies in the design and manufacturing of steel infrastructure. This includes transmission towers, electrical substations, and structural components that support the National Electric Grid. We operate the largest hot dip galvanizing plant in Mexico and one of the largest transmission tower manufacturing facilities in the country. This scale has allowed us to become a leading player in the sector, with presence across multiple regions.

We are actively involved in industry associations. I personally serve on the board of CANAME. From an industry perspective, one of our main priorities is to ensure that transmission projects are developed with a high level of national content. While some imports are unavoidable because certain components are not manufactured domestically, many others could and should be sourced in Mexico. Although, that is not always the case.

What we advocate for as an industry is for Mexico to meet the manufacturing demand required by these strategically important projects and to strengthen domestic production rather than rely unnecessarily on imports.

Q: What trends are you seeing in terms of client requirements, and how have transmission projects in Mexico evolved?

A: We serve clients across several sectors, but within the electrical segment we primarily work with three types of customers. Our most important clients are EPC companies, which handle engineering, procurement, and construction, and deliver transmission lines with a turnkey approach. We do not perform construction ourselves, but we supply critical infrastructure for these projects.

Another key client is CFE, which at times procures equipment directly from manufacturers like us. In addition, we work with private clients that require smaller transmission lines or substations to connect their facilities to the grid.

Across all these client types, the most consistent requirement is delivery time. This reflects the reality that many projects are tendered and awarded with very tight schedules. When timelines are unrealistic, developers often turn to imports to meet deadlines.

We have consistently emphasized that with proper planning, we are willing and able to invest in additional capacity and workforce. The challenge is that many announced projects do not ultimately move forward, which makes long term investment decisions more difficult. As a result, despite being a fully Mexican company, a significant portion of our production is currently destined for the United States, where demand is stable and growing. Ideally, we would prefer to see that demand materialize within Mexico.

In addition to delivery times, clients demand competitive pricing. Mexico has a strong and well integrated supply chain, which allows us to offer highly competitive prices. The challenge often lies in the lack of a level playing field. Some competitors import products without fully complying with regulatory and fiscal requirements, which creates unfair competition.

From a compliance standpoint, Sisttemex is certified as an Hecho en México company for all products and processes. We meet all CFE requirements, including LAPEM certification, and we employ welders certified under international standards such as AWS. These certifications are part of our daily operational discipline.

Q: What has been your strategy, and what advantages has it brought to manufacture in Mexico as a Mexican company?

A: Our value proposition is based on manufacturing under the highest standards of quality, traceability, and regulatory compliance, meeting both national and international norms. This allows us to compete globally, not only within Mexico.

That said, it is also a reality that competition is not always conducted under equal conditions, particularly with companies from countries that operate under different regulatory frameworks or receive government subsidies. This is where policy and regulation become relevant.

We are seeing a clear trend toward strengthening the national supply chain and increasing domestic content in transmission projects, something we as an industry have consistently promoted. Certain imports will remain necessary, but the focus should be on importing only what cannot be produced in Mexico while reinforcing local manufacturing capabilities.

Recent announcements regarding tariffs on imports from countries such as China, Turkey, Vietnam, and India reflect the government’s intention to strengthen the domestic supply chain and reinforce North American integration ahead of the upcoming USMCA renegotiation.

Our competitiveness is not based on artificial advantages. We compete on delivery times and on prices that reflect real market conditions. At the same time, we advocate for stronger demand for companies that manufacture in Mexico and generate local employment.

All our workforce is Mexican. This is a point of pride for us. Mexican labor is highly capable, and our objective is to continue growing in order to create more jobs and further strengthen the domestic industrial base.

Q: What trends do you believe will have the greatest impact on project development in the electrical sector? 

A: There is significant investment coming to Mexico, but this trend is not only national, it is global. I attended a transmission sector conference in Dallas about two months ago, and the global consensus is clear: there is an unprecedented demand for transmission infrastructure worldwide.

Today, the core challenge is not energy generation but energy transmission. There is sufficient generation capacity, yet the infrastructure required to move that energy to where it is needed is lacking. New combined cycle plants, solar facilities, and thermal solar projects will continue to be developed, but without transmission lines, that energy cannot reach end users or allow plants to operate efficiently.

This makes the current moment a particularly strong one for companies in this sector. The coming years will be very active and prosperous, but they will also demand significant effort from companies to ensure they are prepared to participate and not be left behind.

We firmly believe that the participation of Mexican companies in these projects adds substantial value, particularly by reducing logistical times. Sourcing equipment from Queretaro is fundamentally different from importing it from India, Turkey, or China.

There is also an important technical dimension. Designs developed under foreign standards do not always align with Mexican operating conditions. Structures may end up being over engineered or, more concerning, under-designed for local requirements, which can have cost implications or even pose risks if failures occur.

As a Mexican company, we design and manufacture under the conditions of this country. We comply fully with national standards, including all applicable NOMs and the technical specifications required by CFE, which governs the sector.

Looking ahead, initiatives such as Plan México point to a substantial pipeline of work. While the plan has already been presented, its real impact will become more visible starting in 2026. We are confident that this marks only the beginning of sustained demand for serious companies with financial strength, technical capacity, and proven experience to support this growth.

Q: How does the Hecho en México seal fit into your strategy?

A: The renewed Hecho en México seal is still relatively new in its current form, but we see it as an important tool that aligns with our objectives. We are committed to participating in any initiative that helps us stand out while fully complying with government regulations and being recognized as part of the national supply chain.

We describe ourselves as a Mexican company, made in Mexico, and well made. Not everything produced in Mexico meets the highest standards, and we take pride in the fact that our products do. We operate in full compliance with regulations and industry requirements. For us, being made in Mexico is a source of pride. It represents quality, transformation, and responsibility. That is what defines us as Sisttemex.

Grupo Sisttemex is a Mexican industrial group specialized in the design, manufacture, and installation of complex steel infrastructure and associated services for critical sectors, including energy, telecommunications, and transportation.