Absolut to double production

Absolut to double production

Pernod Ricard subsidiary The Absolut Company has received the green light from authorities to double production capacity as it looks to rebuild growth for its namesake vodka brand.

Sweden-based Absolut told just-drinks today (22 January) that it plans to build volume to 100m litres per year at its facility in Nöbbelöv, Sweden.

Pernod aims to return volume sales growth on Absolut vodka to 7-8% annually, which it enjoyed prior to the global economic downturn.

Absolut's global volume sales fell 6% in Pernod's most recent fiscal year, to the end of June 2009.

Pernod blamed the fall on recession in the US, by far the brand's largest market, and a change of distributors in all markets following Pernod's acquisition of Absolut owner Vin & Sprit.

In the US, Absolut was hit by destocking issues and a shift away from on-trade, a segment where the brand is traditionally strong.

Krister Asplund, vice president of operations at The Absolut Company, told just-drinks today that utilising the fresh production capacity would be an “ongoing” task.

“We are not fully utilising it right now but we have for many years experienced growth of 7-8%, maybe over the last 25 years. For that to continue we have a long-term plan to fulfil demand and we looked at increasing capacity and grow to 100m litres.

"This is preparing for the future and when we need it we will use it so it is ongoing,” Asplund said.

The company said it is also planning to manufacture biogas from its manufacturing waste.

“We have been lucky located in the middle of Swedish farmland with pigs and cattle to get rid of all of our waste,” Asplund said. “In the future, when we need to utilise the 100m litres, we will look at the possibility of manufacturing biogas.”