Dive Brief:
- The Molson Coors Beverage Company plans to cease production at its Irwindale, California, brewing facility by September, according to a press release Monday. The site produces the company’s Miller Lite, Coors Light, Miller High Life, MGD, Steel Reserve and Miller 64 brands, among others.
- “This move will allow us to optimize our brewery footprint while streamlining our operations for greater efficiency across the network,” Chief Integrated Supply Chain Officer Brian Erhardt said in a statement. He cited excess production capacity that could be absorbed by its other breweries as a reason for the decision.
- The facility currently has 470 employees and produced 4.8 million barrels, shipped to 261 independent distributors in 2019, according to the release.
Dive Insight:
Molson Coors announced a company-wide “revitalization plan” in October 2019 aimed at supporting its higher-end brands, expanding into beverage categories beyond beer and streamlining its supply chain footprint.
“Our business is at an inflection point. We can continue down the path we’ve been on for several years now, or we can make the significant and difficult changes necessary to get back on the right track,” Gavin Hattersley, Molson Coors president and CEO, said on the company’s Q3 2019 earnings call. “Our revitalization plan is designed to streamline the company, move faster, and free up resources to invest in our brands and our capabilities.”
Stopping production at Irwindale is not specifically part of the revitalization plan. However, the plan does aim to “unlock significant resources by eliminating duplication,” according to the press release.
The company’s earnings report for Q3 2019 drew attention to weakening beer sales as U.S. consumers embrace other options such as hard seltzer or reduce their alcohol intake overall. This has created some space to rebalance capacity across the supply chain, trim costs and invest more heavily in marketing and new product development, executives said.
