just On Call - Campari caught in vodka price war - CEO
Campari's CEO said vodka prices are "volatile"
Campari's CEO has hit out at a “second-tier" vodka company that is pulling down prices in the US by "dumping vodka" in the country.
On a conference call earlier today (13 May), Bob Kunze-Concewitz said the practice has left vodka pricing in the US “volatile” and singled out a “very important imported brand”. He declined to name the company, however, saying only that it will change its import and distribution networks by the end of the year.
“Clearly the people who are running the business right now are really emptying their warehouses, dumping prices and that's having an impact on the vodka market,” Kunze-Concewitz said.
When contacted by just-drinks a spokesperson for Campari that Kunze-Concewitz preferred to keep the name of the brand confidential.
Kunze-Concewitz also said that the pricing pressure is most keenly felt in California, but added: “I wouldn't be surprised if it spreads”.
“This is not a long-term phenomenon, but clearly short-term," he continued. "It will have an impact, and it will keep the vodka space volatile.”
Kunze-Concewitz blamed smaller vodka makers for the volatility and said larger competitors “are more disciplined”.
In first-quarter results, released today, Campari posted a 25% drop in pre-tax profits in the three months to the end of March.
For a full round-up of just-drinks' coverage of Campari's Q1 performance, click here.
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