Grupo Modelo, the brewer of Corona beer, has announced that it will temporarily stop production in line with the Mexican government’s orders amid the coronavirus pandemic.
The announcement follows a new government order aimed at curbing the spread of the coronavirus which deemed the brewers’ business activities non-essential.
Under the new rules, Grupo Modelo will temporarily stop brewing Corona beer and its other brands – including Modelo and Victoria– that are exported to 180 countries.
Grupo Modelo, which is part of AB InBev, operates 11 breweries in Mexico.
On 30 March, the Mexican government declared a national health emergency and ordered the immediate suspension of all non-essential activities until 30 April after the number of coronavirus cases in the country surpassed 1,000.
In a statement, Grupo Modelo said that the suspension will take place from Sunday and that it was already in the process of scaling down production to a level at which it could resume once the suspension is lifted.
According to the government order, only agriculture and food production were considered essential and able to continue to function.
“If the federal government considers it appropriate to issue some clarification confirming beer as an agro-industrial product, at Grupo Modelo we are ready to execute a plan with more than 75% of our staff working from home and at the same time guaranteeing the supply of beer,” said the brewer in a statement.
In the US, Corona is distributed by Constellation Brands after AB InBev sold Grupo Modelo’s distribution rights in 2013.
Earlier this year, AB InBev said it had lost $170 million in profits during the first two months of 2020 because of the coronavirus epidemic.
The company said the outbreak has led to a “significant decline” in demand in China, resulting in lost revenue of approximately $285 million during the period.
However, the firm highlighted the strong full-year performance of Corona which grew revenue by 21% outside of Mexico, with major contributions from markets such as China and South Africa.
© FoodBev Media Ltd 2020