Sat | May 27, 2017

Anheuser-Busch boosts spending

Published:Friday | May 19, 2017 | 5:00 AM

Anheuser-Busch is upgrading its United States breweries and plans to build two new distribution centres as it adapts to an increasingly fragmented beer market.

The maker of Budweiser, Bud Light and Stella Artois says the upgrades and new distribution centres in Los Angeles and Columbus, Ohio, will allow it to store a greater variety of products and get them to customers faster.

The measures are part of the US$500 million that the company said Monday it will invest in its US operations this year, marking an increase compared with recent years. It's a portion of the US$3.7 billion in global capital expenditures that the Belgian company had already budgeted for 2017.

Anheuser-Busch has struggled to boost sales volumes as craft beers grow increasingly popular in an already crowded marketplace. In 2016, total volume at Anheuser-Busch declined two per cent, including a 1.6 per cent volume decline in North America.

The same thing is happening with non-alcoholic drinks. PepsiCo CEO Indra Nooyi has said the industry is becoming more "niche", and that PepsiCo needs to learn how to thrive amid that growing complexity.

The investment announced by Anheuser-Busch on Monday includes upgrades to breweries in Fort Collins, Colorado and St Louis, Missouri. The company did not say how many new jobs it expects this year's US investments to create. It has added around 2,500 jobs since 2013, the company said. Anheuser-Busch employs more than 17,000 people in the US.

In 2015, Anheuser-Busch had said it expects to invest US$1.5 billion from that year to 2018. The Monday announcement was an update, with the company saying it is spending US$2 billion from this year through 2020.

- AP