AB InBev faces watered down profits...and beer?

Yesterday wasn’t a good day for Anheuser-Busch InBev. The company announced its profits fell last quarter, by almost five percent, and it got saddled with three lawsuits alleging the company has misrepresented how much alcohol is in its beer. 

Budweiser is what’s called an American lager. For many years, Anheuser-Busch was run by a family with exacting standards.

“They specified the barley, the hops,” says Peter Reid, the publisher of  Modern Brewery Age, a magazine about the beer industry. “All the ingredients were top notch.”

He says that InBev, the company that bought Anheuser-Busch in 2008, has a reputation for cost-cutting, but still, he says he is skeptical of what the plaintiffs claim.

“I was surprised in the suit that they hadn’t done independent testing of the alcohol content.”

In a statement, Anheuser-Busch says the claims are “completely false,” and these lawsuits are “groundless.”

Many large-scale beer makers do brew high-alcohol beer, then water it down to a normal level, to sell to consumers.

“It’s much quicker, easier, and cheaper to water down a product later on,” says Matt Simpson, owner of “The Beer Sommelier.” He says that’s one thing, but if the company mislabeled what it was selling, that’s another.

About the author

David Gura is a reporter for Marketplace, based in the Washington, D.C. bureau.
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All this is not surprising. Beer connoisseurs have long considered Budweiser to be at the absolute bottom of the preference list (almost tasteless). Maybe the general consumer is finally getting a little more selective.

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