U.S. Challenges AB-InBev's Purchase of Grupo Modelo

I'm watching CNBC on this deal...big news! Here is another article from the Wall Street Journal.

http://online.wsj.com/article/SB10001424127887323701904578275821720321186.html

 

Perhaps the times they are a changin'. Are there some serious beer drinkers in the Justice Dept. these days?

 

Interesting news. I wonder why the DOJ finally made a move?

 

I'm glad. Even though I dont buy bud, AB could raise prices of all their brands, as well as eliminate a major competitor. Not good for the industry as a whole.

IN-BEV is "shopping" for more craft brands as well. Interesting tweet by a Lagunitas rep here:



I know AB has pressured other brands to go year round and to expand their distribution. Interesting how AB wants even more craft beer under their brand.

 

Interesting that the reason they blocked the deal is to prevent AB InBev from raising beer prices on consumers. If AB InBev raised the prices of their crap beers to US consumers, wouldn't more people just buy craft beer, since it would be even more similar in price? Or do you guys think it would end up raising beer prices across the board? Or is this a bogus assumption that InBev's takeover of Modelo would raise beer prices to the consumer? To me, I'm glad they blocked the deal because I didn't want InBev taking over more of the market, even though I have already been boycotting them and refuse to purchase any brand they own or partially own.

 

My guess is a settlement will be reached, but it will involve ABInbev getting rid of the right to buy Constellation down the road (10 years?) that was included in the deal to sell them the importation rights to Modelo. I saw something a week or so ago that that might be a sticking point.

Having a right to purchase down the road "encourages" Constellation to act in a way that makes ABInbev happy.

 

Was going to post the exact same thing. Bud Light - $9.99 a six pack. lol

 

Cue all the posts saying how much better Lagunitas would be with a big powerful corporation behind them.

 

No, people would just pay more for AB-Inbev products. You make the assumption that the majority of BMC drinkers do so only because it's cheaper, and that's a fallacy. They just prefer it. Non-BMC/craft beer is not an exclusive club that everyone wants into, but only some can afford to join. That's hubris.

 

Then how do I join hubris?

 

I'm going to disagree with you just a little bit. I have a lot of customers that come in everyday and buy bud light, natty light, etc.. and I've talked to them about it and most of the responses I get are "I like that good beer but I just can't afford to drink it on a daily basis". Now I'm not saying this is absolute for everyone, maybe just an exception to what you said but it is out there.

 

Yeah I think a lot of BMC drinkers prefer Bud, Miller, etc to craft beer and will still keep buying it, even if it costs more. That being said, I think there is a decent amount of BMC drinkers that drink it mostly because it's the cheapest. They might think twice about buying it vs. craft if it's practically the same price. Think college students...when I was in college we drank BMC beers mostly because we could all chip in the least amount of money and get the largest quantity of beer. I preferred the good stuff, but just couldn't afford to buy craft all the time when I was a broke student.

 

Would your customers be willing to drink a PBR at cheap prices if the AB beer went up in price?

Cheers!

 

This is the case with many of my friends/coworkers who drink the cheap stuff. They fully acknowledge the beer they buy tastes like shit. They just don't care.

 

Hell if I know as I don't sell PBR. Like I said this is probably the exception to the rule but just pointing out that's it's out there. All in all if you're a BMC guy, you're poor and you want to drink a beer I'm sure you'll buy whatever you have the money for.

 

“They fully acknowledge the beer they buy tastes like shit.” Is this something that they just say to you or do you really think they think it tastes like shit?

My personal issue with AAL beers is not so much that they taste ‘bad’ but that they are bland and insipid; it other words they are tasteless vs. tasting ‘bad’.

Cheers!

 

A good paraphrase of most of the stuff I hear would be "It tastes like shit, but it gets the job done" so yeah, they are saying that.

 

Weird!?! I would never refer to something that I willingly purchased to drink (or eat) as tasting like shit.

Mainstream beer drinkers are strange!?!

Cheers!