Kansas City Southern reported a lower quarterly net profit that missed out on Wall Street estimates by a wide margin as a historical drop in the Mexican peso after the election of U.S. President Donald Trump impacted the local U.S. railroad’s operations in Mexico.
Simply hours before Trump was due to take office in Washington, Kansas City Southern mentioned his policies of mainly U.S. companies that make products in Mexico for delivery to the United States – Trump has targeted a few automakers, mentioning tariffs or a “border tax” on the automobiles they make.
Trump has furthermore vowed to roll back the North American Free Trade Agreement (NAFTA), though it is uncertain how that would be done.
Among Kansas City Southern’s selling points to financiers has been its substantial network in Mexico. When Ford Motor revealed previously this month that it was deserting plan for a plant there and would invest in Michigan, the railroad’s shares dropped 4 percent.
