Soft drinks appear to be one of the last products Mexican households give up in tough economic times. In spite of the generalized slowdown in the Mexican economy, a recently published Standard and Poors report projects that soft drink sales will increase an average of 4% to 5% per annum through this decade.

More than half of the growth in upcoming years will be linked to the population growth rate estimated to be between 2% and 3% per annum. Over and above that amount, aggressive promotion on the part of soft drink bottlers should generate growth in the range of 2%.

Mexico can be a price-sensitive soft drink market and prices increases tended to be below the rate of inflation until the second quarter of this year. At that time Coca-Cola increased its prices by 25% in some regions and Pepsi followed with an 11.5% increase. There is no evidence to date that the price increases had a negative impact on sales.

The Market for Soft Drinks in Latin America