Beer business ‘well positioned' against inflation: Anheuser-Busch CEO
Anheuser-Busch says its Michelob Ultra brand is having one of its strongest years
Anheuser-Busch CEO Brendan Whitworth said the company is "well positioned" to handle the tumultuous economic environment given the industry's extreme resiliency in recent years.
Although fears of a potential recession are growing, Whitworth expressed confidence in the brewing company, a subsidiary of Belgium-based AB InBev, and its ability to weather economic challenges in part because of its expansive portfolio ranging from higher to more economical price points.
In July 2021, Whitworth took over as chief executive for the nearly 170-year-old company that has more than 100 brands, including Budweiser, Bud Light, Michelob Ultra, Stella Artois and Shock Top, which are sold and distributed across the nation.
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"Because we have brand representation and strong brands … all across the different price points of the industry, we feel pretty well positioned to handle whatever and wherever the consumer goes," Whitworth told FOX Business.
In fact, one of its brands, Michelob Ultra, is having one of its strongest years, Whitworth said.
According to data analytics and market research company IRI, the brand has doubled its volume in the last five years.
"It's a few dollars to get something like Michelob Ultra, which consumers are willing to spend for," he added.
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Even if "consumers start making a few more decisions relative to how they choose to spend," Anheuser-Busch has low-cost options to cater to that, according to Whitworth.
As an example, he pointed to the company's Busch Light brand, which sits within its value segment.
"It's been going extremely well since 2019 and has continued to do extremely well now," he added.
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When asked if the company has raised prices, Whitworth said it has "followed what's happening with inflation" and increased costs to a degree it thinks is "appropriate" given the increased costs in the supply chain.
However, those cost increases depend, in part, on the brands and the region in which they are sold.
"You have to reflect the disruption of the supply chain that's been taking place," he said. "But we're very conscientious of competitiveness, very conscientious of what's happening across the rest of the world of consumer packaged goods."
It hasn't deterred customers. Even with higher prices, the company noticed that consumer spending has remained "somewhat unchanged."
"Maybe they [consumers] don't take a trip that they were planning to take, but they seem to still like buying Stella Artois…in that way, we feel, regardless of what happens in the future, that the industry is resilient," he said.
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On Wednesday, Chair Jerome Powell acknowledged what many economists have been saying for months. The Fed’s goal of engineering a "soft landing" — managing to slow growth enough to curb inflation but not so much as to cause a recession — looks increasingly unlikely.
Still, Whitworth said, "that's not where our mind is," adding the industry seems to be in "good shape."
"If you look back on other recessions...the industry just continues to be resilient or shows evidence of resiliency," he added.
The Associated Press contributed to this report.