TWE and Accolade will share bottling responsibilities

Australia's two largest wine producers have struck a deal to bottle each other's wines.

Treasury Wine Estates (TWE) will pack Accolade's wines in Australia, and Accolade will do the same for TWE in the UK, the companies announced today (24 July). However, the deal will see the loss of 175 jobs at Accolade's Reynella bottling facilities near Adelaide, Accolade said, as TWE takes over Australian packing responsibilities.

TWE said the partnership will streamline operations and make the best use of available assets.

“We have put a big focus on increasing efficiencies in our supply network and this new arrangement with Accolade will leverage these efficiencies by utilising spare capacity in our Australian facilities,” said TWE chief supply officer Stuart McNab.

Most of Accolade's Australian wines will be bottled in TWE's two Barossa Valley packing plants, a TWE spokesperson told just-drinks. No new jobs will be created as the plants' existing spare capacity is expected to cope with the increased production, the spokesperson said.

Accolade said the decision was not taken lightly because of the job losses, but would allow the company to focus on growing sales in North America and Asia.

“For a number of years we have researched alternatives to avoid outsourcing our Reynella bottling and distribution facility, including relocating assets within the business. No other option delivered such long-term benefits,” said Accolade Wines CEO Troy Christensen.

A spokesperson for Accolade, which is headquarted in Reynella, said the site's bottling facilities will close but other operations will remain. The job losses represent about 10% of the company's workforce, the spokesperson said.

Accolade will absorb TWE's UK bottling into its plant in Bristol, increasing production there by 30%. The spokesperson said Accolade is reviewing operations in Bristol to see if more staff are needed to cope with the increased production.

Previously, TWE used several service providers for its UK bottling.

The companies said planned packing volumes will be reached by next January.