PepsiCo to invest $1 bn in China over next 4 years

PepsiCo to invest $1 bn in China over next 4 years
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First Published: Mon, Nov 03 2008. 03 01 PM IST
Updated: Mon, Nov 03 2008. 03 01 PM IST
Reuters
Bejing: PepsiCo Inc said on Monday it plans to invest $1 billion in China over the next four years, as part of the company’s strategy to expand in emerging markets.
The US based food and beverage company’s investment in China will fund a variety of major capital programmes to expand manufacturing capacity, particularly in interior and western areas, said PepsiCo’s chairman and chief executive officer, Indra Nooyi, who is in China this week.
“This is our largest investment in China in the nearly 30 years we have been doing business here, and it is consistent with our broader global strategy of investing in high-growth developing markets,” Nooyi said in a statement.
Beverage sales in the United States, especially sales of bottled water, have been hit hard as a housing slump, credit crunch, job losses and high gas prices have forced cash-strapped consumers to make fewer trips to gas stations and convenience stores, eat out less often and drink tap water to save money.
PepsiCo cut its full-year outlook last month as an economic slowdown sapped soft drink demand.
The investments are expected to create thousands of new jobs in China, where PepsiCo and its bottling partners already directly employ more than 22,000 people, it said in the statement.
The announcement was made during a four-day visit by Nooyi, who has been holding meetings with government officials and local business executives and visiting the company’s local operations.
The money will also be used to expand local research and development facilities and build the company’s sales force to boost product distribution, the company said in the statement.
The statement did not say whether PepsiCo is expanding manufacturing capacity by building up more plants.
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First Published: Mon, Nov 03 2008. 03 01 PM IST