Responding to the rising tide of seltzer and hard seltzer sales in 2020, Molson Coors Beverage (NYSE:TAP) announced this morning it will quintuple its production capacity for these beverages at several of its most important facilities. While the company didn't provide exact figures, it said it "invested millions of dollars to install new equipment" at its Fort Worth plant and added new equipment to its Milwaukee facility, too.
The move is part of Molson Coors' strategic objectives for the coming year. During the recent third-quarter 2020 earnings conference call held on Oct. 30, CEO Gavin Hattersley said that by "the end of 2021, we plan to capture a double-digit share of the U.S. seltzer market, backed by what arguably is the most complete seltzer portfolio in the business." He added the company expects to generate $1 billion in annual revenue from seltzer sales within three years.
According to today's press release, Molson Coors' new brewery equipment investments will allow it to boost production by a factor of five for several of its fastest-growing seltzer brands, including Blue Moon LightSky, Coors Seltzer, and Vizzy. Nielsen data indicates Blue Moon managed to grow significantly during the worst of the initial COVID-19 pandemic, with case volume rising 28.9% between Feb. 29 and May 30. The improvements in Milwaukee will increase Blue Moon packaging capacity by 2,000 cans per minute.
Like most major breweries, Molson Coors began losing ground to microbreweries even before the novel coronavirus arrived. COVID-19 increased its woes, with seltzer offering an area where the company might be able to win back some of the revenue lost to the long-term and short-term decline in traditional beer sales.