Pabst claims MillerCoors is trying to put it out of business

Discussion in 'Beer News & Releases' started by pat61, Nov 12, 2018.

  1. pat61

    pat61 Poo-Bah (5,132) Dec 29, 2010 Minnesota
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  2. Sweatshirt

    Sweatshirt Disciple (320) Jan 27, 2014 New Hampshire
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    I won't be happy if PBR goes away.
     
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  3. tone77

    tone77 Poo-Bah (5,428) May 20, 2009 Pennsylvania
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    PBR, Colt 45, and to a lesser extent Natty Bo are in my regular rotation of cheap beers. I would hate to see them disappear.
     
  4. Premo88

    Premo88 Poo-Bah (1,738) Jun 6, 2010 Texas
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    Not surprising, and it's not really a macro brewery trying to kill a craft brewery, is it? In fact, if MillerCoors brews, packages and ships Pabst products, what the hell does Pabst do? The business world seems like the most unscientific, unlogical thing ever created, but I'm pretty stupid, so I'm sure it's just me.

    I'd hate to lose Lone Star and Lone Star Light, but we'll be fine if they die.
     
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  5. bbtkd

    bbtkd Poo-Bah (2,100) Sep 20, 2015 South Dakota
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    Seems like PBR was living on the edge, knowing the contract was running out, knowing they had no alternative brewers, and knowing they they were competing with MC - their contractor.

    MC can hardly be blamed for not wanting to renew, allowing them to close inefficient plants, and concentrate on their own production efficiency. So, will the courts force MC - against their best interests - to continue supplying a competitor in a shrinking market?

    I'm not a lawyer, but I'm not a believer in forcing one company to do business with another. Say that MC is forced to renew the contract on terms acceptable to PBR. Won't they both still be looking for a mutually exclusive advantage over the other, constantly bickering in court? Kind of like forcing a couple to stay married when they want a divorce. I'm afraid the only alternative is to sell out to someone with enough brewing capability. So - is that MC's end game, forcing PBR to sell out?
     
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  6. beertunes

    beertunes Poo-Bah (5,581) Sep 24, 2007 Washington
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    A: Hamms is what peeber was a decade ago.

    B: Maybe the hidden meatwads that own the peeber brands should shut up and build their own damn factories.

    C: Hahahahaha at a company who only owns "brands" trying to tell a company who actually owns facilities that they MUST manufacture products.

    I'mma start a car company, call it Pontiac, and make GM build my cars.
     
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  7. jesskidden

    jesskidden Meyvn (1,343) Aug 10, 2005 New Jersey

    Most industry analysts point to Pabst's moving their contract brewing from Stroh (which took over Heileman a couple years earlier and which had been doing a lot of brewing of Pabst brands) to Miller in 1998 as the final straw that pushed Stroh into leaving the industry in 1999.

    At that point, Pabst still had a few of breweries left (ex-Olympia in Washington, ex-Pearl in Texas and, briefly running the Stroh brewery in PA) but soon closed them as soon as Miller was able to move production around to accommodate the expanded Pabst portfolio (Pabst bought most of the S-H brands, with Miller picking up a few of Pabst and S-H brands) and they proudly proclaimed themselves a "Virtual Brewer". (The CEO at the time was quoted as saying "Why would I want to own a brewery?")

    Of course, what the article in the OP neglects to mention is that both companies (MC and Pabst) were under totally different ownership when that initial Pabst/Miller contract deal was initiated in 1998. Pabst was still run by the estate of the former owner, Kalmanovitz Charitable Trust, and Miller was owned by Philip Morris.

    As for the Pabst brands if Pabst left the business, it is likely that MillerCoors and/or other company(ies) (but at this point there are not many left with the excess capacity- NAB, maybe? A non-brewer contracting with City and others?) would buy many of them - to maximize capacity, if nothing else-since they are pretty much the only thing Pabst "owns" and they still have some value. Heck, given AB's new ownership, they also might be interested in some, if the DoJ would allow it.
     
    #7 jesskidden, Nov 12, 2018
    Last edited: Nov 12, 2018
  8. bbtkd

    bbtkd Poo-Bah (2,100) Sep 20, 2015 South Dakota
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    I agree about the part where one company shouldn't be forced to contract to another. The gotcha here - depending on the court - is how they interpret the previously equitable agreement between MC and PBR and decide whether it sets ongoing commitment/precedence of any kind. Doesn't sound like PBR will prevail, but some judge might order a year or two extension of the relationship to give time to sort it out, though they have both had 20 years to see the end coming, with one looking forward to it and one not.
     
    #8 bbtkd, Nov 12, 2018
    Last edited: Nov 12, 2018
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  9. jesskidden

    jesskidden Meyvn (1,343) Aug 10, 2005 New Jersey

    Not really. The "Miller Brewing Co." that first started contract-brewing Pabst brands in the late '90s no longer exists and what remains of it today, 5 US breweries and numerous brands, has been wholly-owned by Molson Coors only since 2016.

    Likewise, the "Pabst Brewing Co." has been sold twice since the late 1990s and previous to those sales had closed its remaining breweries. The current ownership (Kashpar and TSG Partners) only took control in 2014.

    According to reports at the time, when the Metropoulos family bought Pabst in 2010, the contract (then set to expire in 2014) was renegotiated "long term" with MillerCoors.
     
    #9 jesskidden, Nov 12, 2018
    Last edited: Nov 12, 2018
  10. bbtkd

    bbtkd Poo-Bah (2,100) Sep 20, 2015 South Dakota
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    Whatever contract end date was in place, they had both agreed to it and had plenty of time to plan, and even through ownership changes they should be well aware of any agreements and contracts in effect.
     
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  11. cavedave

    cavedave Poo-Bah (2,458) Mar 12, 2009 New York
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    This is like Godzilla fighting King Kong. Don't really care who wins, and it is a fight likely to be fun to watch.
     
  12. jesskidden

    jesskidden Meyvn (1,343) Aug 10, 2005 New Jersey

    This particular legal battle has been going on for more than 3 years now, since negotiations started in the Fall of 2015 (around the same time MC announced the closing of their Eden, NC brewery), as noted in this Milwaukee Business article, dated May, 2016.
     
  13. zid

    zid Savant (916) Feb 15, 2010 New York

    Craft fans picturing King Kong fighting Godzilla are probably imagining it like "King Kong vs Godzilla" from 1962 where King Kong was scaled up to Godzilla's size... a battle of titans that would look nothing like Godzilla fighting the far smaller "real" King Kong from 1933, although that size difference would be a far more fitting image. It's not like these entities are a comparable size. I think Sierra Nevada has far more employees than Pabst Brewing Company.
     
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  14. MoreBeer4me

    MoreBeer4me Aspirant (269) Aug 25, 2014 New Jersey
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    This would be bad news for me as PBR is one of my few and favorite ordinary beers. My god, it blows the doors off of Miller and Bud. Miller should just buy it and do some marketing for the brand.

    On another note, I find it amazing that Bud does no contract brewing. I drank a few Bud's at my fathers house this weekend and was scratching my head as to why people buy and drink that crap. Its so bad, there has to be substantial excess brewing capacity available.
     
  15. zid

    zid Savant (916) Feb 15, 2010 New York

    Bud Light and Budweiser are two of the top three selling beers in the US, and you figure that there must be substantial excess brewing capacity because you think they're bad? I feel like it's relatively safe for me to lump those two beers together in your worldview. Um... why am I even bothering with asking this?
     
  16. cavedave

    cavedave Poo-Bah (2,458) Mar 12, 2009 New York
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    Haha I guess I shouldn't have referred to an actual movie. I meant it more as a battle of familiar, lumbering, giant monsters.
     
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  17. Alefflicted

    Alefflicted Initiate (77) Dec 2, 2017 Minnesota

    I was thinking basically the same thing. Admittedly you said it better then I would have, so thank you good sir.
     
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  18. MoreBeer4me

    MoreBeer4me Aspirant (269) Aug 25, 2014 New Jersey
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    Yes...and they used to sell a shitload more of it years ago as compared to today. As in an ENORMOUS SHITLOAD MORE. "Two of the top three" is a relative term son.
     
  19. zid

    zid Savant (916) Feb 15, 2010 New York

    I deserved your retort, but while I couldn’t tell you about the brewing vs capacity volume of the company across all of their various brands (including The High End) and how that number fluctuates over the years when looking at the global market, you aren’t claiming that you’re doing that either. You said, “Its so bad, there has to be substantial excess brewing capacity,” right after you mentioned that people buy it. :slight_smile:
     
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  20. IPAExpert69

    IPAExpert69 Initiate (167) Aug 2, 2017 New Jersey

    I really hope Pabst survives this, such a nostalgic beer for my college days. I remember fondly yelling "PBR" when ideas about a keg were floated around. I may have been shot down for Natty Light 8/10, but those 2/10 were gloriously not as shitty!
     
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  21. tzieser

    tzieser Savant (994) Nov 21, 2006 New Jersey
    Trader

    Same here. Let's not forget about the rest of the PBR "portfolio" of other, regional retro brands like Ballantine, Country Club, Schaefer, Stag, Olympia, Rainier, Lone Star, Old Milwaukee, Old Style, Primo, Schlitz, Schmidt's, Stroh's, Special Export, etc. etc. I've had most in the portfolio and each have their own place at the table, IMO. It'd be a massive bummer if these all of them get shit canned (pun intended)

    Same, until we discovered that you could get a keg of Rolling Rock for the same price or a couple bucks less (though I personally still preferred PBR just a bit more)
     
  22. jesskidden

    jesskidden Meyvn (1,343) Aug 10, 2005 New Jersey

    Well, Budweiser's barrelage peaked in the late 1980s at around 50.5 million barrels in 1988. Bud Light (still less than a decade old) sold 9.6M bbl., so the "Bud Family" was around 60M bbl.

    In 2017, Bud Light (33.1M bbl) and Bud (13.3M) combined for around 46.4M bbl., so yeah, quite a drop - around 25%.

    BUT AB's (which has a much larger brand portfolio today) total US market share is still about the same (despite some lost share after peaking in the late '00s with 107M bbl.) as it was in '88 when Budweiser was at its peak.

    1988 = 40.9%
    2017 = 41.6%

    Well, the current Top 3 - Bud Light, Coors Light and Budweiser (w/Miller Lite hot on its tail) account for 3 out of every 10 beers sold in the US. So, yeah, "relative". Throw Miller Lite in to mix, and the US Top 4 account for over 1 out of every 3 beers.
     
  23. jesskidden

    jesskidden Meyvn (1,343) Aug 10, 2005 New Jersey

    Last I checked, AB's 12 US breweries were rated at 107 million bbl/yr, and their US total barrelage was 89.5 million last year. So, yeah, nowhere near capacity - which is typical for macro brewers in recent decades - in the '70s both AB and Miller
    were maxing out.

    Some of AB's total is brewed overseas (the InBev imported brands, with Stella leading with 2.7M bbl.). I'd assume the US brewed Becks and Bass - and the "captured" craft beers brewed in-house- are simply counted as AB beer in their total.

    By contrast, MillerCoors' 8 US breweries had a total capacity of 76M bbl/yr before closing the 9M bbl. Eden, NC facility - leaving them around 67M. They're barrelage for '17 was 52.3M.

    EDIT - Oh, yeah. The likeliest potential closure of an AB plant has been rumored to be Newark. Their second oldest (circa 1950)and third smallest, at 7.5M bbl/yr. The even eliminated their bottling lines there - cans and kegs only.

    But 7.5M barrels is enough to brew all the Pabst portfolio's barrelage and it's not like they haven't been there before :grin::
    [​IMG]
     
    #23 jesskidden, Nov 12, 2018
    Last edited: Nov 12, 2018
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  24. MoreBeer4me

    MoreBeer4me Aspirant (269) Aug 25, 2014 New Jersey
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    In one way or another PBR will survive. This particular beer won't be allowed to die.
     
  25. billandsuz

    billandsuz Disciple (368) Sep 1, 2004 New York

    PBR is not a brewery and it's never been a secret.
    PBR is a business model and it is run by executives in the marketing department.

    The business model, it ran out. Nothing to see here, just the death of one particular brand. Let's not pretend that the PBR label can't be printed on any of a dozen other AALs. It can and it will.

    Sorry I just don't see the great loss. Though it is funny to hear failing business executives threaten to sue over an expired contract. Really? These PBR people, they act like Miller works for them!

    Cheers.
     
  26. nc41

    nc41 Poo-Bah (1,631) Sep 25, 2008 North Carolina
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    You might think it's bad, but the fact Bud Light is an enormous monster, one that sells, and everyone on this site could retire today if we had equal shares. The point is most beer drinkers are not on BA, they don't give two shits for BA Stouts or NEIPAS. You might not like it but there's millions who vote with their wallet and who like AB products. Bud isn't swill, it's a decent enough AAL, but that's my opinion. I like PBR too, I'd hate to see it go away, another iconic beer from yesterday.
     
  27. surfcaster

    surfcaster Crusader (743) Apr 20, 2013 North Carolina
    Premium Trader

    PBR is mostly now about nostalgia. Decent AAL and we all can relate to PBR specials of old and new. I remember 50 cent PBR either longnecks or cans on Friday happy hours in the 80s and was in a college town 2 weeks ago with 1$ PBR on Friday. Plenty of things out there without the BMC stigma that could be "revived" to take its place if PBR cannot be resuscitated. Bet it sticks around in some form.

    Seems like the folks "managing" this brand are doing a poor job if after 3 years there is not better plan in place than what has been discussed here.
     
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  28. nc41

    nc41 Poo-Bah (1,631) Sep 25, 2008 North Carolina
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    Maybe it's my age, maybe it's marketing, but everything is Bud Light, Miller Lite, Curs as Sam Elliott pronounces it. There's so little advertising, even Bud commercials are rare as hell. Anyone 30 ish or maybe even 40 ish really has no ties to there iconic brews. Back in the day that all there was, but it seems like one bites the dust every year or so. Schmidts, Schaeffer, Black Label etc. Plus many local beers that are no longer popular or even still living; Gibbons, Reading , Utica, Ortliebs, Piels. Now it's not about a family Brewery it's just about money and I get that. Sure like the look on those long neck bottles with the cool labels, or the Chug a mugs, or the Steine bottles.
     
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  29. Dandrewjohn

    Dandrewjohn Initiate (96) Apr 13, 2013 Texas

    It stretches the imagination to believe that MC would close two breweries just to dump Pabst as their lawyers suggest. That would be the tail wagging the dog, seems to me. Perhaps it factored into the decision; they very well could have had excess capacity, and any responsible company would have to constantly watch their economies. On the other hand, I’m a PBR drinker, and if MC does cause their demise, it will be a cold day in hell before I buy another High Life, not to even mention Lite.
     
  30. beertunes

    beertunes Poo-Bah (5,581) Sep 24, 2007 Washington
    Trader

    Shit, boy, I will kill it personally. If Dennis Hopper can die, fucking peeber can too. Good got-damned riddance.
     
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  31. KingforaDay

    KingforaDay Defender (641) Aug 5, 2010 New Jersey
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    Welcome to the Club Pabst.
     
  32. nc41

    nc41 Poo-Bah (1,631) Sep 25, 2008 North Carolina
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    I'd love to see AALs done like the old Reingolds Chug A Mugs. For you young guys that's a Mickeys hand grenade kinda bottle. The vessel really works for the style.
     
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  33. Jaycase

    Jaycase Meyvn (1,213) Jan 13, 2007 Illinois
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    'F#ck that sh#t' - Frank Booth
     
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  34. beertunes

    beertunes Poo-Bah (5,581) Sep 24, 2007 Washington
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    Did you ever have the Piels with the barrel shaped bottle, wide-mouth, with the pull-tab top? Man, I was constantly cutting my 12 year old hands on the ones I would snag out of the cooler on camping trips. Clumsy, I was. Clumsy I remain.
     
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  35. nc41

    nc41 Poo-Bah (1,631) Sep 25, 2008 North Carolina
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    Yep, that's the Chug a Mugs. Such a great bottle for those kinda beers. I don't like Mickeys Malt, but those the the same bottles as the Piels, and Reingolds.

    You got Piels in WA?
     
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  36. beertunes

    beertunes Poo-Bah (5,581) Sep 24, 2007 Washington
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    No, just memories from when I was a youngster in Upstate NY. Well, memories, and maybe a couple of faint scars.
     
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  37. nc41

    nc41 Poo-Bah (1,631) Sep 25, 2008 North Carolina
    Trader

    Damn, yep , you grew up in Ny forgot that, the Piels makes sense. Must have been the sponsor of the NYY back in the day, the Phillies were sponsored by Ballentine. Still like that bottle format for AALs.
     
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  38. beertunes

    beertunes Poo-Bah (5,581) Sep 24, 2007 Washington
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    Grew up near Rochester, and the Red Wings were Baltimores AAA team. Saw a lot of great players come through.
     
  39. JackHorzempa

    JackHorzempa Poo-Bah (3,710) Dec 15, 2005 Pennsylvania
    Premium

    Have you tried the 'new' Piels that is brewed now?

    Cheers!

    [​IMG]
     
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  40. beertunes

    beertunes Poo-Bah (5,581) Sep 24, 2007 Washington
    Trader

    Nope. This is actually the first I've heard of it.