Lease Awarded for Tijuana-Tecate Rail Line

An investment group led by Mexican construction firm Grupo Morphy has won the bidding for a 25-year lease to operate the 44-mile Tijuana-Tecate railroad line in Baja California, outbidding a rival group led by RailTex of San Antonio, which has operated the link since 1984. Grupo Morphy, lead investor in the entity called Medios de Comunicacion y Transporte de Tijuana, outbid the RailTex group by more than 4 to 1, offering $78.4 million in an auction that is part of Mexico’s ongoing railroad privatization effort. RailTex had hoped to use the link as the keystone in reopening the 131-mile San Diego & Arizona Railroad, of which the Tijuana-Tecate stretch is the middle link. Grupo Morphy’s plans were not immediately known. The line would give San Diego and Tijuana a direct rail link to the Imperial Valley and the U.S. rail grid to the east, bypassing Los Angeles. RailTex, which controls the U.S. ends of the line, now runs service only from San Diego to Tecate.