Others News
- Tsingtao Brewery to build Thailand plant
Date: 25-Oct-2007 Sources: (Shenzhen Daily)
TSINGTAO Brewery Co., China's best-known beer brand, is broadening its international reach, targeting consumers in Southeast Asia by building its first overseas plant in Thailand.
'For all these years, we're in China competing with overseas brands,'board secretary Yuan Lu said yesterday. 'But we cannot always stay home. We should go out.'
Making beer overseas can also help Tsingtao avoid a 3 percent export duty, she added.
'Southeast Asia is our fastest growing region for exports, but we pay very high tariffs for Thailand,'' Yuan said. 'By setting up the plant, we can boost competitiveness.''
The Thailand project is worth 294 million yuan (US$39 million), with Tsingtao owning a 40 percent stake, and will produce 80,000 kiloliters of beer each year upon completion.
Tsingtao, 27 percent owned by Anheuser-Busch Cos, has come under pressure from foreign rivals such as SABMiller, Heineken and Carlsberg in the world's biggest beer market by volume.
The Thai brewery may help Tsingtao boost overseas sales, which account for about 3 percent of its revenue, as it faces increasing competition at home from larger rival China Resources Snow Breweries Co. Tsingtao's domestic market share fell to 12.9 percent last year from 13.3 percent in 2005.
'This is the right strategy for Tsingtao and Thailand is the right place to build factories,'said Wang Yiguo at China Janyin Investment Securities.
'Tsingtao is well-known among ethnic Chinese and booming tourism and hot weather there would help beer sales.'
Tsingtao will sell premium beer in Thailand, where the market is crowded with low-end beer, Tsingtao's Yuan said.
Half of the beer to be produced in Thailand will be sold locally, with the rest targeting other countries in Southeast Asia, she said.
Tsingtao's profit in the first three quarters jumped almost 61 percent to 695.44 yuan.
The company accounts for half of China's beer exports, although that volume is tiny compared with domestic sales, Yuan said.
Tsingtao's overseas sales grew 9.2 percent in the third quarter of this year, slower than the 11 percent gain in total sales. Thailand has seven breweries and had beer sales totaling 2.1 million kiloliters last year, Yuan said.
Sponsor Results:
