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Mercado Libre, a leading Latin American ecommerce platform, is betting on further rampant growth.
On the heels of record results last year, it plans to invest $13.2bn this year – 36% more than it spent on expansion in the region last year.
With a presence in 18 countries, the company often regarded as Latin America’s answer to Amazon posted a 38% rise in revenue, to $21bn, for 2024 on merchandise sales worth $51.5bn on its platform.
Marcado Envios, its logistics arm, handled 1.8bn items, claiming 49% of deliveries completed on the same or next day. Net revenue of Mercado Libre’s fintech arm rose 24.8%, to $8.6bn.
Management is bullish on 2025, which is probably helped by the decision of the Mexican government to impose a 19% levy on imports via courier firms from countries that do not have free-trade agreements with Mexico, a step that gives the Uruguay-headquartered firm a financial advantage over Temu and Shein.
The firm consistently claims its competitive prices and fast delivery speeds are key factors in its growth strategy and that these were decisive in the competition with the China-based ecommerce platforms. In Q4 24, shipments delivered the same or next day were up 21% on a year earlier.
The lion’s share of this year’s $13.2bn outlay, some $6,2bn, is earmarked for Brazil, Mercado Libre’s largest market, generating 55% of its revenue.
Mexico, its second-largest market, stands to get $3.5bn in investment and a boost to its workforce in the country by more than 10,000. Most will be in the logistics arena.
Its growth strategy for Mexico is centred on the garment and textile sector. This is a narrowly focused effort that targets four areas with a high concentration of manufacturers: Mexico City’s Mixcalco area, that boasts more than 1,500 businesses in this vertical; Leon, a centre for footwear and leather production with about 2,500 factories; Guadalajara, a key hub for textile and fashion items; and Moroleon, another centre of textile production.
The aim is to bring new vendors onto the Mercado Libre platform and offer new tools to clients through a mix of promotions, consulting, and other support. This is a model that has worked well in Argentina, Brazil, Chile, and Colombia since its launch in 2023, according to the company, .
Mexico’s ecommerce market grew 20% by value last year, to $40.21bn. According to the Mexican Association of Online Sales (Asociacion Mexicanda de Venta Online), it has grown at a rate of 33.8% over the past six years.
And, despite the turmoil from US tariff policy, Mercado Libre is optimistic that the sector will continue to grow, arguing that it has shown resilience in the face of similar challenges.
Mercado Libre’s expansion should also boost Mexico’s air cargo volumes; last year cargo throughput at the nation’s airports grew 5.6%, fuelled by a 7.2% increase in international traffic.
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