Daft’s decision

Following a major reorganisation by Coca-Cola’s Chairman and CEO, Doug Daft, Coca-Cola has created four strategic business units: Americas, Asia, Europe/Africa, and New Business Ventures. In March Steven Heyer, 48, formerly President of Turner Broadcasting Systems, was brought in to head Coke’s New Business Ventures unit. Coke insiders Jeffrey Dunn (Americas), Sandy Allen (Asia), and Charles Frenette (Europe/Africa) will head the other three units. The executives of the four units report directly to Daft.
The overhaul eliminated the need for a company president. Therefore Coke’s President and COO, Jack Stahl, 47, resigned..

Killarney’s Red Lager launched

Anheuser-Busch has launched a new speciality brew, Killarney’s Red Lager, which is supposed to appeal to consumers looking for a rich, full-bodied beer. Cashing on the lore of Ireland, promotional items will feature Irish imagery. The red lager has 5% alc./vol. and is brewed at Anheuser-Busch’s Fort Collins, Colorado, brewery. Anheuser-Busch has also launched 16-ounce contour cans of Michelob and Michelob Light that sport the brand’s tear-drop shape. Let’s hope the cans don’t give people ideas to cry into their beer. The contoured cans are sold as singles and in a 12-pack.

Craft brewing industry grew 4.1%

The year 2000 saw the continued stabilisation of the craft-brewing industry for both packaging brewers and brewpubs alike, according to figures released by the Institute for Brewing Studies (IBS).
Overall the industry grew 4.1%, more than doubling 1999’s 1.9% increase over 1998. The net volume gain for 2000 was 235,000 barrels, bringing total sales to more than 5.9m barrels. Craft brewing’s share of the total U.S. beer market remained at 3%.
Last year’s performance renewed confidence among brewpubs and specialty brewers. More brewers today say they are truly optimistic, rather than cautiously so at the end
of 1999.8m barrels. Among reporting regional speciality brewers, sales increased by an average of 8.7% per company..

Pabst to close Pearl brewery

At the end of April Pabst plans to close its brewery in San Antonio. More than a year ago Pabst had told its workers that the brewery was to be closed but then shelved the plan. In the meantime most of the production has been contracted out to the Miller plant in Fort Worth, which left the Pearl brewery with a production volume of 50,000 barrels last year instead of the one million barrels it brewed as recently as 1999. Pabst intends to keep its corporate staff in San Antonio and will continue to operate only one brewery, the Lehigh Valley brewery, in Pennsylvania.

Truce ... of sorts

After more than 60 years, ANOTHER Budweiser is being sold in the US again. Which one could it be? Obviously, it’s the one they brew at the Czech brewery of Budejovicky Budvar. In order to avoid being taking to court by Anheuser-Busch, the beer is sold under the name of Czechvar.
The state-owned Budejovicky Budvar and Anheuser-Busch have been fighting in the courts for decades over who has the right to the name Budweiser. In some countries the courts have sided with Anheuser-Busch, in others with the Czech brewer. Since 1939 Budvar has not been sold in the US when both brewers signed an agreement which effectively prevented the Czechs to sell Budvar in North America.35m hl and a 11.4% increase in revenues to 2.6bn Kc (US$71.8m). Exports to the UK and Germany more than doubled..

Grupo Modelo’s volume up 6.1%

In 2000, Grupo Modelo’s shipments of beer reached 36.5m hl, an increase of 6.1% over 1999. Domestic volume grew 4,1% and export 13.2%. Grupo Modelo announced that export shipments represented 23.4% of the total volume compared to 21.9% the previous year. For the 12 months ended 31 December 2000, Grupo Modelo’s consolidated income statement reported net sales of 29.3bn Pesos (US$3.3bn) versus 26.7bn Pesos in 1999. EBITDA was 9.0bn Pesos (US$942m). Grupo Modelo also made effective use of its cash pile of US$620m by buying the remaining shares in dozens of Mexican beer distributors for an estimated sum of US$90m. The brewer now wholly owns 64 domestic distributors.

Too much sex

Let’s try an do something drastic is often the last ditch attempt to save a brand. But it is also a risky move. Molson Canada, like South African Breweries (see below), has been sitting on a brand, Molson Export, for some time, which has not gone anywhere at all, certainly not upwards from its present 5% share of the market. Hence Molson dreamed up the advertising campaign, "Had Ex today?", in September 2000, which seems to have reversed the brand’s sales decline. The tagline "Had Ex today?" is a pun on the nudge-nudge, wink-wink kind of question "had sex today?" which is a staple concern of those in the throes of testosterone.
Incidentally, the new campaign represents a U-turn on the original Ex position as the tipple of choice for virile young men. The conversation runs like this.

Will they get their act together

With consumers thirsting for New World wines, Argentine wines could be the next big thing. Argentina is the world’s fifth largest wine producer.
For the past five years, international drinks heavyweights by the name of Kendall-Jackson of the US, Pernod Ricard of France, Allied Domecq of Britain, Sogrape of Portugal and Concha y Toro of Chile have ploughed more than US$250m into wineries. Argentine investors have responded with US$250m of their own.
The question is: Will Argentine wine companies develop their industry for export? The US Department of Agriculture’s Foreign Agricultural Service
estimates that of the 365m gallons of wine produced in 2000, Argentina only exported 32m gallons..

Anheuser-Busch reported that domestic beer shipments to wholesalers rose to 98.3 million barrels (115 million hl) in 2000. This represents an increase of 2.6 million barrels or 2.7% over 1999. Patrick Stokes, CEO of Anheuser-Busch, was quoted as saying that the "Bud Family" led this record achievement. Once again, Bud Light delivered outstanding results, registering its 9th consecutive year of double-digit growth.

Name change

Genesee Brewing Co., Rochester NY, finally completed its long-awaited management buy-out. Eight former Genesee executives bought the company for US$25.8 million, US$14.8 million of it in cash.
Changing the name to High Falls Brewing Company does not mean that the Genesee name will disappear. In fact, it will appear on all labels except for the new speciality brews. Those will be sold under the High Falls label.
Pabst Brewing Co. had offered to purchase some of Genesee’s brands to be brewed elsewhere, but that would have meant the closing-down of the Genesee brewery and 450 workers loosing their jobs.
The new management will spend US$3.5 million more on advertising than the old regime to improve sales. Also, the company will offer more contract brewing opportunities..