Heineken's van den Brink. Heineken's van den Brink.

Heineken announces $2bn in new spending

Beer maker optimistic about growth potential in Mexico

The Mexican beer market can only get bigger as far as the Dutch brewer Heineken is concerned, which is why it is doubling its investment spending to US $2 billion between now and 2019.

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The new spending, $500 million of which has been allocated for the current year, will bump production capacity and move the firm into new market segments such as cider, said the CEO of Cuauhtémoc Moctezuma-Heineken, Dolf van den Brink, at a press conference.

The investment represents 15% of what it plans to invest at the global level. The domestic market amounts to 16% of the firm’s volume worldwide, 13% of its sales and 17% of its profits.

Van den Brink sees strong growth potential in Mexico due to the average age of the population: at 27 years, it is the lowest among member countries of the Organization for Economic Cooperation and Development.

Mexico is the world’s sixth largest beer market even though its annual per-capital consumption, at 59 liters, is half that of Germany’s 103. Heineken expects that rate of consumption to increase.

Van den Brink said the company is growing so fast in Mexico that it decided it was necessary to increase capacity at its plants in Tecate, Toluca and Guadalajara and invest in new distribution systems.

A new plant in Meoqui, Chihuahua, announced a year ago, is scheduled to begin operating next year, producing 5 million hectoliters annually to begin with.

The company will introduce one of its European brands in northern Mexico today. Van den Brink said Amstel Light, which is now being brewed in Mexico, will be the first European light beer in the domestic market.

Source: CNNExpansión (sp), El Universal (sp)

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