RUSSIA: Tax hikes force Anheuser-Busch InBev to close brewery
A-B InBev is being forced to close another of its Russian breweries
Rising alcohol taxes and government regulation has forced Anheuser-Busch InBev's to shutter another one of its breweries in Russia.
The Novocheboksarsk brewery in the Republic of Chuvashia will close and production moved to other sites, the company's subsidiary, Sun InBev, confirmed to just-drinks in a statement today (5 June). It is the second brewery Sun InBev has closed in Russia in the space of a year, following the shutting of its Kursk facility last August.
Following the latest closure, Sun InBev will have seven operational breweries in Russia.
“This is a tough decision that we do not take lightly, but unfortunately we do not see any other option in the current beer market conditions,” Stuart MacFarlane, A-B InBev's zone president for Central & Eastern Europe, said.
The brewer said a combination of a five-fold tax hikes since 2009 and “various legislative restrictions and bans” has made Russian beer industry regulation “one of the toughest in the world".
According to SUN InBev figures, the Russian beer market saw volumes drop by 20% between 2009 to 2012, while in the first quarter of this year beer production fell a further 10%.
The Russian Government banned print media advertising of alcohol on 1 January, an extension of measures introduced last year that outlawed alcohol promotions on television, radio, the internet, public transport and billboards. It has also stopped street kiosks selling beer.
In November, an analyst suggested A-B InBev should cash in on SUN InBev because it was “losing critical mass” in Russia.
Anheuser-Busch InBev (A-B InBev) is facing challenges in the mature US beer category by focusing on premium and craft beer. As the US Justice Department precluded A-B InBev from controlling the lucrat...
Anheuser-Busch InBev Germany’s strategic direction is mainly in line with the international parent company and the company does not have a lot of room for self-governance. Partial autonomy is granted,...
InBev Italia’s strategy for the forecast period will be to continue its occasion-based marketing, and to promote its products. The company will concentrate its efforts on meeting consumers’ expectatio...
Inbev will continue to focus on premiumisation, adding value and Increasing its channel coverage over the forecast period. The company will continue to invest heavily in marketing support and new prod...
- Focus - Pernod's YTD Performance by Region
- Comment - Will We Understand the Language of Rum?
- just On Call - Pernod shifts Scotch focus in China
- Focus - Heineken's Q1 Performance by Region
- just The Preview - Pernod Ricard's Q3 & YTD
- CFO of Diageo's United Spirits stands down
- Pernod Ricard sees YTD recover as sales increase
- BrewDog launches GBP25m crowd-funding attempt
- Remy Cointreau US head to step down
- Africa "subdued" but Heineken sees Q1 rises
- Global Tequila insights - market forecasts, product innovation and consumer trends research
- Global rum insights - market forecasts, product innovation and consumer trends research
- Diageo plc (DGE) - Financial and Strategic SWOT Analysis Review
- ALDI 2015: Radically transforming Anglo Saxon grocery markets
- Bacardi Limited - Strategy and SWOT Report