If you ever wondered how deep Anheuser-Busch InBev’s pockets are, maybe this will give you a little perspective. The world’s largest brewery is going to invest $2 billion in their U.S. market over the next three years.
To date, ABI has purchased ten craft breweries valued a millions each. They operate 12 production facilities around the U.S. that produce over 200 million barrels (or 6.2 billion gallons of beer) annually. In contrast, the largest craft brewery (in volume), D.G. Yuengling & Son, hovers at 3 million barrels annually.
ABI pays $20 million to Major League Baseball annually for licensing rights, $1 billion to the National Football League for a six year licensing deal, plus Major League Soccer and Nascar deals.
Let’s not forget the 100+ billion dollars spent on acquiring SABMiller.
The list goes on, but you get the idea. ABI has some pretty deep pockets.
America’s craft brewers are a little intimidated, and maybe a little scared of this world Anheuser-Busch is creating. That kind of money flush operation is hard to compete with. The battle for grocery store and gas station shelf space is being decisively won by ABI. Now craft’s biggest competitor is dropping $2 billion in their American beer presence over the next fews years.
Where The Money will be Spent: 2017-2020
Below is a brief breakdown of how $2 billion will be spent. Take note of a new interesting initiatives that include Elysian, new dry hopping tech, and planning for new brands and products at a few key facilities.
- $15 million will be spent on the Fairfield, California facility. Elysian Brewing will soon be producing their Space Dust IPA there.
- $200 Million will be spent on capital improvements at the brewery’s 12 largest production facilities. (Some noted below)
- $180 million is earmarked for expanding aluminum bottle production (a big sell at concert and sports venues)
- $82 million is headed into Anheuser’s supply chain. Some of the cash will build state of the art distribution centers in Los Angeles and Ohio
- $10 million will be invested in non-alcoholic operations in Baldwinsville, New York
- $28 million expands Fort Collins, Colorado brewery’s aluminum bottle production, and new dry-hop capabilities
- $18 million at Williamsburg facility for new technology and labeling machines
- $12 million at Cartersville, Georgia facility for new packing capabilities, and new energy efficiency
- $13 million for the Saint Louis facility for new beechwood tanks, and new abilities to brew new brands
- $11 million at Merrimack to to begin innovative cross brewing capabilities…alongside craft partners.
- $11 Million at Jacksonville for aluminum bottles
- $8 million will be spent at Houston to brew Michelob Ultra Lime Cactus, and aluminum bottle production
With 10 new breweries under their belt, the new distribution facilities are a requirement. Additionally, at least one of the production facilities is gearing up to brew beer from their acquired, former craft breweries (at minimum Space Dust IPA).
By the looks of things, ABI is investing in themselves and their presence in the American market. Most likely expect to see brands like Wicked Weed, Four Peaks, Karbach, and Golden Road going national. Let’s leave it with a quote from Anheuser’s VP of Supply:
“We are focusing on investments which empower our employees to do what they do best – brewing the best beer. Ninety-eight percent of the beer we sell in America is proudly made here at our 21 breweries using the highest quality ingredients.” – Dave Taylor, Vice President of Supply for Anheuser-Busch.
2 thoughts on “AB InBev will spend $2 billion on their American brewing operations”
more aluminum bottles destined for… LANDFILLS … while InBev is not sole producer, but certainly fueling the fire. The quote “brewing the best beer…” wow, the Kool-Aid you must drink to be a part of this monster… IMHO, of course.
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