Heineken invests r $ 1 bi in Brazil to expand the production

The Dutch brewery Heineken, the world's third-largest brewer behind Anheuser-Busch InBev (AB InBev) and SABMiller, has been growing at a double-digit pace in Brazil and needs to expand production, keeping an eye on the long term. To this end, Didier Debrosse, President of Heineken in the country two years ago, decided to take off an investment of R $ 1 billion, which will expand the production capacity of 19 million hectolitres for 25 million HL until 2018.
The plan, to be announced to the market tomorrow, includes the installation of a new factory in Itumbiara (GO)-will be the seventh of the company in Brazil, with 650 million contribution of R$.
"We believe in Brazil over the long term," said Debrosse to value, which is in 28 years ago Heineken. Before that, this French born on the border with Germany, he worked on Nivea and Kraft. In this, taking care of coffee. "That's when I started to hear about much of Brazil. But I had never traveled to South America. The first time was in April 2013, to find a place to live in São Paulo ".
After eight years working in the array of Heineken in Amsterdam, the command offered him two options, Mexico or Brazil. "I chose Brazil because the challenge is greater. About the Brazilian recession, he is definite: "Forget the next two, three years." Demographics, says, is favorable to the expansion of the beer market and the "class C you don't want to go back to being D and e".
Heineken's sales in the first nine months of 2015, grew at a rate of two digits in Brazil. After 67 consecutive months of expansion, the brewery has surpassed Brazil Kirin, the Japanese Kirin, and became the third-largest beer company in the national market, with 9.4% market share.
In 2014, Heineken was the fourth runner-up, with 6.7% stake, after Ambev (63.9%), Brazil (13.3%) and Kirin Brewery Petrópolis (11.5%). In the premium segment, according to the company, Heineken owns 18 percent of the market.
The expansion project in Brazil includes the installation of a plant in Itumbiara (GO), with capacity to process 3.6 million hectolitres, and investments of R$ 241 million to double the capacity of the factory of Ponta Grossa (PR), 2.6 million hectolitres for 5.2 million hectolitres. Itumbiara unit will provide beer for the Midwest, Northeast and Minas Gerais.
The contribution also includes an investment, made in October, of 150 million R$ in the installation of a new production line in Jacareí, whose capacity of the factory was enlarged in 800 thousand hectolitros/ano. Debrosse explained that the company will also make investments in factories so that the company can produce the entire portfolio in any unit. Currently, the Heineken brand, for example, is only produced in Jacareí (SP) and Araraquara (SP).
The other brands are produced in the Ponta Grossa, Gravataí (RS), Feira de Santana (BA) and Paracatuba (EC). Heineken had a plant in Manaus for production of Kaiser, but was closed down this year due to its low productivity. "We're building a business. The company attempts to be as efficient as you can in the balance of costs, "said Debrosse.
Heineken's plan for the Brazilian market, says the Executive, is to consolidate the brands that the company already has in Brazil, especially the brand Heineken, considered premium. The biggest rival of the company, Ambev, seeks to grow in the Coutry with premium beers and malt-based drinks, known as "near beer".
"I believe in innovation and believe in the ' near beer ', but I wonder if this thread is able to grow as quickly as the premium beers," said the Executive.
The premium segment, which two years ago represented between 3% and 4% of the national market, has grown to 7% to 9% of total sales this year. "This market is growing very rapidly in Brazil", says Debrosse. The consumption in Brazil this type of beer is 6.7 liters per capita per year. If they are considered other types, 68.6 per liter capita/ano are, according to data from Euromonitor.
The investment, to be announced by Heineken is the largest made by the company in Brazil since the purchase of the beer Division of the Mexican beverage giant Femsa for $ 7.6 billion in 2010. Before that, Heineken played in Brazil with imported beer. With the acquisition of Femsa, incorporated the marks Kaiser, Summer Draft, Bavaria, Xingu and Sun and their factories.
Debrosse said, at the time, Heineken saw as main advantage in buying Femsa leadership that the company owned in the market of beer from Mexico. Since then, the company has made smaller investments in Brazil, with focus in the areas of trade, logistics and distribution.
The Executive says that sales of the company are more significant in the Southeast and South, although the company also has strong presence in capital markets as Macapá, Manaus, Teresina and Fortaleza, mainly with the Kaiser.
"I and Heineken believe in Brazil. Now it's hard to know where the country is going. But, in the long run, the country still has an amazing offer of resources, a large population, with a middle class representative "said Debrosse. The Executive estimated that the beer market will reheat in two to three years, after the improvement of the economic and political conditions.