Scotch producers invest for future growth

Scotch sales are set to soar if investments by the trade’s leading brands are anything to go by. Bacardi is the latest to announce a significant spending spree

Scotch sales are set to soar if investments by the trade’s leading brands are anything to go by. Bacardi is the latest to announce a significant spending spree, promising to shower £120m on its Dewar’s whisky, primarily to boost blending and bottling capabilities, as well as increase inventories.

Bacardi is also buying a 100-acre site in central Scotland to build a second building for maturation and blending.

This is the latest in a line of investments by multinational drinks companies. Earlier this year Diageo unveiled plans to invest over £100m in a new distillery while Pernod Ricard’s Chivas Brothers have been expanding bottling operations. Martin Riley, international marketing director for Chivas Brothers, said at a press conference last week that the company has “a substantial inventory,” and was “in a very strong position to take advantage of market growth.”

Such growth is expected to come from Latin America, Asia and other emerging markets. In particular, India poses potential after the announcement the country would remove protectionist “additional duties” on imported spirits.

As Pernod Ricard’s managing director Pierre Pringuet points out, “There are 60m cases of whiskey consumed annually in India and if only 10% of that converted to Scotch you can imagine the potential.”

Currently, Scotch whisky accounts for less than 1% of the whisky sold in India. It is believed a lower tax regime will allow sales to quadruple in the next five years.

Patrick Schmitt, 01.08.07