Skip to main content

The Globe and Mail

AB InBev replaces North America chief to stem sales slide

AB InBev's brands include Budweiser, Stella Artois and Corona, while SABMiller produces Peroni and Grolsch.

Kirsty Wigglesworth/AP

The world's biggest brewer, Anheuser-Busch InBev, is replacing its North American chief to stem a years-long sales decline in its largest market.

The maker of Budweiser and Bud Light said on Monday that Joao Castro Neves would be succeeded on Jan. 1 by another Brazilian company veteran, Michel Doukeris, currently chief sales officer of the global business.

Bud Light remains the single largest beer brand in the United States, but it and its mainstream peers have been in steady decline, as U.S. drinkers embrace wine and spirits. When they drink beer, they tend to choose more unusual craft beers made by smaller producers.

Story continues below advertisement

AB InBev has sold less beer in North America in each year since 2014, with a steep 6.2 per cent drop in the third quarter of this year.

"People are trading up," said Liberum analyst Nico von Stackelberg. "I don't think anyone is really hoping for dramatic volume turnarounds. Just stopping the bleeding is the hope."

Doukeris, who joined the company in 1996, has run its Chinese and Asia Pacific operations, helping to expand Budweiser globally, and launched its "High End" business strategy focused on growing imported and craft beers. The company has acquired nearly a dozen craft beers in recent years.

"The U.S. is our most important market and we recognize the need to continue to focus on driving topline growth across our portfolio," said AB InBev Chief Executive Carlos Brito.

"(Doukeris) is the ideal person to lead North America at this time, together with an emerging group of leaders being elevated in the company."

The company announced five other North American appointments on Monday, including the promotion of Brendan Whitworth, a veteran of PepsiCo and the U.S. Central Intelligence Agency, to the role of vice president of sales, replacing Alex Medicis, who is leaving.

Sales volume for the U.S. beer industry was down 1.8 per cent for the first nine months of the year and has been down for the past decade, according to Wells Fargo analysts. Per capita beer consumption is down 20 per cent in the past 35 years.

Story continues below advertisement

AB InBev shares were up 0.6 per cent at 100.95 euros at 1627 GMT.

AB InBev's high-end strategy was launched in China and expanded to 22 countries while Doukeris ran the sales division, garnering the business more than $5-billion in global sales. But in September, the unit announced a reorganization that included the loss of about 2 per cent of its workforce or around 300 jobs.

Craft beer is off its double-digit growth rates, but should still grow at about 6 per cent this year, compared with an overall beer industry that could be down as much as 1.5 per cent, according to analysts at Susquehanna. They estimate craft beer could reach 12 per cent of the industry this year.

Report an error

The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

Please note that our commenting partner Civil Comments is closing down. As such we will be implementing a new commenting partner in the coming weeks. As of December 20th, 2017 we will be shutting down commenting on all article pages across our site while we do the maintenance and updates. We understand that commenting is important to our audience and hope to have a technical solution in place January 2018.

Discussion loading… ✨