Chipotle is trying to take over Mexico through its softest border town
· Fortune
In one of Mexico’s wealthiest enclaves, the newest entrant in the crowded Mexican food market this week isn’t a taquería, a fonda, or a family-run stand. It is Chipotle.
The California-based restaurant giant announced its first location in part of the Monterrey metropolitan area will open on Thursday in partnership with Alsea, a leading restaurant operator in Latin America and Europe, to bring its customizable burrito bowls, tacos and quesadillas south of the border, with plans to open more restaurants in Mexico City in 2027.
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“Our research has reinforced our belief that there is strong interest in high-quality, freshly prepared food served with the customization and convenience that Chipotle offers,” Chipotle CEO Scott Boatwright said in the press release.
The chain has traveled a long way from its original Denver home, but its latest move is more delicate: bringing burritos and bowls to Mexico, where the company will find out whether a restaurant built on Mexican-inspired ingredients can sell its version of fast casual in the country that gave those ingredients much of their cultural weight.
It’s a parallel of sorts to Domino’s Pizza, which tried to sell Americanized pizza in Italy only to close all 29 of its locations there in seven years, and to Taco Bell, which failed to appeal to Mexican consumers twice. Both chains suffered from serving food that appeared both inauthentic and unappetizing, unable to compete with local offerings.
“Its existence is an affront to Italian culture, bastardizing pizza beyond belief,” Jeffrey Pilcher, a University of Toronto professor specializing in global food history, told Fortune about Domino’s. “I don’t think that’s quite the same thing as Chipotle.”
Chipotle said its approach will respect Mexico’s culinary heritage and provide the same signature menu prepared fresh throughout the day as it would in the United States. This direction seems to avoid some of Taco Bell’s pitfalls. Pilcher, who also wrote a book on Mexico’s food history, explained that Taco Bell failed in Mexico because it didn’t serve the same U.S.-style Taco Bell menu the small slice of middle-class Mexicans who visited the U.S. would be familiar with, and also didn’t serve recognizably Mexican food.
“It was kind of a joke anyway,” Pilcher told Fortune about Taco Bell’s foray.
He also noted Chipotle’s expansion could pan out more successfully because the Monterrey area is more receptive to Americanized food than other parts of the country because of its familiarity to the U.S. and a sizable population of American telecommuters.
“I think that the more Cal-Mex sort of burrito might play better in Monterrey than it would even in Mexico City,” Pilcher told Fortune.
But even in Monterrey, where most people travel back and forth from Mexico to the U.S. for shopping and groceries and are more in touch with American restaurants than their peers in other parts of Mexico, it will still be an “uphill climb” for Chipotle, according to Bchara Zúñiga, who advises foodservice and retail executives in the Americas for GlobalData.
“What makes Chipotle unique in the U.S. will not be as unique in a market that’s already full of fresh produce and similar ingredients,” Zúñiga told Fortune. “It is true the Monterrey consumer is a little bit more open to that type of format, but I think that’s going to be the main challenge.”
He said Chipotle will face stiff competition from Mexico’s 80% independent restaurant sector, which is popular and also boasts fresh ingredients, but that the partnership with Alsea was “very smart” because of its track record with expanding international brands like Starbucks and Burger King, and that the company’s approach – being inspired by Mexican cuisine rather than trying to repackage it – sets it apart from Taco Bell and Domino’s.
“I don’t think Mexicans will feel as threatened with the idea as they did with Taco Bell or Italians with Domino’s,” Zúñiga said.
Chipotle did not respond to Fortune’s request for comment.
This story was originally featured on Fortune.com