PepsiCo, one of the world's largest food and beverage companies, will invest an additional $2.5 billion in China over the next three years as it tries to catch up with its arch rival Coca Cola in the $23-billion Chinese soft drinks market.
This new investment announced yesterday by PepsiCo chairman and CEO Indra Nooyi, is in addition to the $1 billion investment PepsiCo announced in November 2008, which will be completed this year. (See: Pepsi to invest $1 billion in China). Nooyi is attending the Shanghai Expo, where PepsiCo is a sponsor of the USA Pavilion.
The new investment will cover a variety of projects, including new manufacturing facilities, a significant scaling up of the company's research and development operations, expanded agricultural development and brand-building initiatives.
The New York-based PepsiCo with annualised revenues of nearly $60 billion, plans to open 10-12 new plants in China in the provinces of Fujian, Gansu, Henan and Yunnan in the next two years, in line with the company's strategy to expand in the interior and western China, and will install additional production lines in existing facilities.
"I am delighted to announce that over the next three years we expect to invest $2.5 billion in our food and beverage businesses in China," said Indra Nooyi, "This investment reflects very clearly our great confidence in China and our long-term commitment to this very important, growing market.''
PepsiCo, which currently operates 27 beverage and food plants and 5 farms throughout China and employs more than 20,000 people, will open five new farms for potatoes and oats, bringing advanced irrigation technology to each.