SHANGHAI Nov 8 The Coca-Cola Co said it
will invest over $4 billion in China and build new plants
between 2015 and 2017, to counter competition which is chipping
away at its share of the country's 421 billion yuan ($69.12
billion) soft drinks market.
The investment will add to the $4 billion that the world's
largest drinks maker has earmarked for China in 2012-2014, said
Asia-based spokeswoman Sharolyn Choy, confirming a Bloomberg
report earlier on Friday.
The beverage maker is also open to deals with local firms,
Choy said. Analysts said this could help it play the trend in
China toward more local-style herbal teas and healthier drinks.
Chinese consumers are increasingly opting for healthier
alternatives in food and drink, which has hit growth for fast
food chains such as McDonald's Corp and KFC-parent Yum
"The beverage market is quite competitive right now and Coke
is going to have to do a lot more acquisitions rather than
growing through organic growth," said Shaun Rein, Shanghai-based
managing director of China Market Research Group.
"It is starting to compete against some really
well-capitalised local players like JDB, which has a herbal tea
called 'JDB Red Can' that out-sells Coke in many provinces in
China and is double the price."
Coca-Cola is still the leading drinks maker in China. It
held 16 percent market share by total volume in 2012, down from
16.6 percent five years ago, according to data from market
research firm Euromonitor.
Ting Hsin International Group, which owns food and beverage
maker Tingyi Cayman Islands Holding Corp, is the
second-largest drinks maker. It has increased its market share
over the same period from 8.8 percent to close to 12 percent.
Coca-Cola's global sales missed targets in the April-June
quarter, with the company citing economic slowdown in Europe and
China's economy is set to grow at its slackest pace in 23
years in 2013, at 7.5 percent, as its export sales falter on
fragile global demand.