In a move signaling confidence in tequila’s continued ascent, Brown-Forman Corporation is pouring $200 million into expanding its historic Casa Herradura tequila distillery in Jalisco, Mexico to meet soaring global demand.
According to Elisa Gutierrez, Vice President and General Manager for Casa Herradura, the multi-phase project will include expansion to distillery operations, bottling, maturation and processing areas. Construction is set to begin in July with an expansion of the on-site water recycling and treatment plant, which Gutierrez described as an opportunity to “advance our existing waste-to-energy efforts,” followed by the expansion of capacity for distilling, bottling, maturation, and processing.
“Our Herradura and el Jimador brands have been seeing double-digit net sales growth, driven by the worldwide surge in preference for premium tequila. We expect this trend to continue and are enhancing our production capabilities to accommodate this demand,” said Lawson Whiting, CEO of Brown-Forman Corporation.
Casa Herradura, acquired by Brown-Forman in 2007, has been producing tequila in Amatitán, Jalisco, since 1870. The distillery also produces the spirit giant’s other tequila in its portfolio, El Jimador. In March, the company reported that net sales year-to-date for the tequila portfolio increased 12% with el Jimador (+18%) and Herradura (+10%) both delivering double-digit net sales growth.
Herradura sits in the segment of higher-end tequilas that have been driving spirit sales in the U.S. Tequila stands as the fastest-growing spirits category worldwide in terms of value, mostly fueled by the super-premium price segment, according to the IWSR. In the U.S., tequila holds a $12 billion retail value, accounting for 32 million 9-liter cases.
Brown-Forman’s recent M&A activity has been targeted at premium brands, including the purchase of the Diplomático Rum family of brands, which hold top placements for super and ultra premium rums, and Gin Mare, the world’s number one ultra-premium gin. Its portfolio growth is still driven by its major whiskeys Jack Daniel’s Tennessee Whiskey and Woodford Reserve, as well as its ready-to-drink offerings.
Blurb: With premium tequila on the rise, Brown-Forman Corporation is pouring $200 million into expanding its historic Casa Herradura tequila distillery in Jalisco, Mexico. The multi-phase project will include expansion to distillery operations, bottling, maturation and processing areas, as well as sustainability efforts. Herradura sits in the segment of higher-end tequilas that have been driving spirit sales in the U.S. Brown-Forman’s growth is driven by its major whiskey brands like Jack Daniel’s but the company reported double-digit growth for Herradura and El Jimador, which is made in the same distillery.