1055291--4/13/2006--MEXICAN_RAILWAY_TRANSPORTATION

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Failure to comply with restrictive covenants in our existing contractual arrangements could accelerate our repayment obligations under our debt. Risk Factors Relating to Our Business We may not be successful at reducing our operating costs and increasing our operating efficiencies. The Mexican government may revoke or limit our concession under a number of circumstances. Failure to make capital expenditures could result in the revocation of our concession and adversely affect our financial condition. Significant competition from other railroads could adversely affect our financial condition. Significant competition from trucks could adversely affect our financial condition. A significant percentage of our transportation revenues has historically been derived from the automotive industry, which has had difficulties in recent years. The rates for trackage rights set by the SCT may not adequately compensate us. Downturns in the U.S. economy, Mexican economy, U.S.-Mexico trade, certain cyclical industries in which our customers operate, the global economy or fluctuations in the peso-dollar exchange rate could have adverse effects on our financial condition. The Mexican government may restrict our ability to operate our concession on a profitable basis by setting tariffs for rail freight services. Traffic congestion or similar problems experienced in the U.S. or Mexican railroad system may adversely affect our operations. Our business strategy, operations and growth rely significantly on third parties. If our primary fuel supply contract is terminated, or if fuel prices substantially increase, our financial condition could be materially adversely affected. We face possible catastrophic loss and liability, and our insurance may not be sufficient to cover our damages or damages to others. We face potential environmental liabilities. Terrorist activities and geopolitical events and their consequences could adversely affect our financial condition. Renegotiation of terms of the labor agreement and any potential labor disruptions could adversely affect our financial condition. Risk Factors Relating to Mexico Governmental policies and economic developments in Mexico and elsewhere may adversely affect our financial condition. Currency fluctuations may adversely affect our financial condition. Inflation and interest rates may adversely affect our financial condition.

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1055291--4/13/2006--MEXICAN_RAILWAY_TRANSPORTATION_GROUP