By Denny Jacob

Chipotle Mexican Grill will open a storefront in Mexico and look to expand into additional markets in the region.

The burrito chain on Monday said it signed a development agreement with Alsea, a restaurant operator in Latin America and Europe, to open a location in Mexico by early 2026.

Chief Business Development Officer Nate Lawton said Mexico's familiarity with Chipotle's ingredients and its affinity for fresh food make it an attractive growth market for the company.

Expansion into Mexico will test whether Chief Executive Scott Boatwright can maintain the string of sales and profits that have helped Chipotle outpace the broader industry. The company is expected to report first-quarter results April 23.

Chipotle's announcement comes as the Trump administration imposes tariffs on U.S. allies and non-allies alike, prompting many businesses to put certain investments on hold as they look for clarity on tariffs and brace for a potential slowdown.

The Newport Beach, Calif., company has demonstrated it can navigate a world where tariffs hang over consumers and businesses. For years it scoured the Americas and the Caribbean in search of farms and suppliers to fill its vast need for avocados as it looked to diminish its reliance on Mexico.

Chipotle has said it won't raise the price of guacamole even as it expects tariffs imposed on Mexican imports to weigh on its profit margins this year.

The company's push into Mexico will test its international-expansion strategy. It signed its first international development agreement in July 2023 with Alshaya Group to open restaurants in the Middle East, and Alshaya currently operates three Chipotle restaurants in Kuwait and two in the United Arab Emirates.

Chipotle's existing international portfolio includes 58 locations in Canada, 20 in the U.K., six in France and two in Germany.

Write to Denny Jacob at denny.jacob@wsj.com

(END) Dow Jones Newswires

April 21, 2025 09:20 ET (13:20 GMT)

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