AB InBev CEO: US Sales Stabilized Post-Backlash, Mexico Growing

Michael O'Boyle
·2 min read
10

(Bloomberg) -- Anheuser-Busch InBev NV’s market share in the US took a hit this year amid a backlash over its use of a transgender person in its marketing, but the company’s chief executive officer said sales have stabilized, and that it remains on top in Mexico.

Most Read from Bloomberg

The Mexican unit of the world’s largest brewer posted 11% compound annual growth over the last five years, CEO Michel Doukeris said in an interview. Meanwhile, there has been a “slight improvement” in recent US sales data, he said.

“Mexico is an incredible example of a very vibrant, very dynamic industry that is growing,” Doukeris said on the sidelines of an investor event in Mexico City.

AB InBev’s Grupo Modelo unit makes Corona and Modelo brand beers for sale in Mexico, where it’s the top brewer. In the US, Constellation Brands Inc. sells Modelo brands as part of a deal with US regulators after AB InBev acquired the Mexican brewer in 2012.

Modelo eclipsed Bud Light as the top selling beer in the US earlier this year amid pushback against the brand for using transgender social media personality Dylan Mulvaney in its marketing. The move sparked calls for a boycott from conservatives that drove a sharp decline in sales. Earnings from the US sank 28% during the second quarter, but were offset by gains in other markets.

Doukeris said the US business has been helped by an advertising push that included sponsored country music concerts and promotions by NFL players such as Travis Kelce and Dak Prescott.

“We see very positive reaction for the NFL campaign, for the music tours, for everything that we are doing, which is on brand,” he said.

In Mexico, President Andres Manuel Lopez Obrador has also been pushing beer makers to move operations to the south amid a severe drought in the north. In 2020, he held a public referendum that also cited water issues and ended up pushing Constellation to abandon a partly built brewery near the US border and plan a new facility in Veracruz state.

Read More: Heineken Heeds AMLO’s Call to Go South

Doukeris said that AB Inbev’s dialog with the government has been good.

“Our footprint in Mexico was very well distributed. So we are not over-concentrated in the north. We are not overbuilt for exports only. So we are really built across Mexico to service the Mexican market,” Doukeris said.

Separately, the Wall Street Journal reported on Wednesday that AB InBev had stopped cutting off the tails of its famous Budweiser Clydesdale horses after pressure from animal rights activists. “The safety and well-being of our beloved Clydesdales is our top priority,” the company said in a statement on Wednesday, where it added that the horses receive the “highest level” of care.

Most Read from Bloomberg Businessweek

©2023 Bloomberg L.P.