Why Vietnam is integral to Carlsberg’s future

Carlsberg has declared that the Vietnamese market is “pivotal” in its strategy to expand across Asia. After investing US$90 million in the expansion of the Phu Bai brewery, the Danish multinational beer group has assured it is also on track to meet its sustainability goals.

Vietnam’s strong economy has not gone unnoticed by Carlsberg. As the beer group looks to boost its presence across Asia as a whole, the strategy has been to locate a stable base from which to advance.

In a recent Q&A with the Vietnam Investment Review, the company’s Asia arm described how its investments into Vietnam were well-considered and strategic, taking into account its environmental, social, and governance (ESG) plans and assisting in giving it ways to align with Asia’s urbanisation and upwardly mobile younger population.

Joy Rice, vice president for supply chain of Carlsberg Asia responded to the VIR and admitted that “Vietnam plays a pivotal role in our strategy”.

Rice noted how this was because “it’s one of the most dynamic and high-potential beer markets in Asia, currently the third-largest in the region and ninth globally, with solid fundamentals driven by a young population, rising incomes, and rapid urbanisation”.

But why has Carlsberg zoned in on Vietnam otherwise? According to Rice: “In 2024, Vietnam delivered standout economic performance and the momentum is set to continue. This market outlook provides a solid foundation for Carlsberg to expand our presence, strengthen our brands, and capture emerging growth segments.” She also pointed out that “on top of that market potential, we are fortunate to have highly capable local teams who are fully aligned with the group’s priorities, from growing market share and driving premiumisation to advancing sustainability ahead of targets” and explained to local investors that “this combination of market opportunity and execution is why we continue to invest here, to grow smartly and in partnership with Vietnam’s long-term future”.

Carlsberg’s Asia arm recently announced further expansion across the region with a collaboration with three of Asia’s biggest quick commerce platforms – Meituan, Grab and Delivery Hero – as part of its new Digital Acceleration Programme. The move is set to advance its brands across urban areas.

But in Vietnam in particular the move is about long term growth as much as efficiency. For instance, outlining more about the Phu Bai brewery expansion, Carlsberg described it as “a strategic investment in both capability and operational efficiency” and revealed that it is now Carlsberg’s “largest beer production facility in Asia and one of the most productive globally in terms of labour efficiency”.

According to Rice, “this is more than just scale” and made pains to describe how the local team is very capable and because of this the beer group has “strong and trusted partnerships with government and related stakeholders”. This has, among other things, led to what she outlined as Vietnam’s “clear long-term potential” as a region.

Looking more closely at the brewery expansion, Rice said that it is all about giving the group the ability to “meet growing demand” for both global brands and local brands housed within its beer portfolio.

Rice revealed that, in truth, beyond commercial growth, the expansion helps Carlsberg to “contribute more to the state budget, strengthen local sourcing partnerships, and build a more resilient supplier network”. She also went on to flag how “it also brings wider economic and social benefits through job creation, skills development, and community engagement”.

Granted, the expansion of Phu Bai represents what the group has described as one of the “most significant capital investments in Asia, with a total value of approximately US$90 million” and, as Rice attested, “will increase production capacity by more than 50%”.

Rice revealed that Phu Bai has the fastest packaging lines in Vietnam’s brewing industry as well as includes “industry-leading water efficiency”. Added to this, She disclosed that the new brew line is also “designed to use 20% less water and 15% less energy”. As well as being conscientious about this side of the production, the brewery is said to be “coupled with biomass-powered steam, iREC-certified renewable electricity, and a zero-waste filtration system” as well as “AI-enabled electric forklifts and upgraded health and safety infrastructure”. There is a lot to unpack in terms of the brewery’s sustainability merits and also to help the group stay informed on what works best so that it might take learnings from the Vietnam expansion when it chooses to roll out another ecologically-savvy facility in the future.

Rice admitted: “What we’ve built at Phu Bai offers learnings we believe can inform how we grow elsewhere, particularly in fast-moving, high-potential markets” and said that it really represents “what’s possible” especially as the group look towards its ambitious 2030 and 2040 sustainability goals.

According to Rice, in the beer world, “sustainability is no longer a trade-off – it’s a catalyst for long-term value”. This means that everything “from sourcing raw materials to brewing, packaging, and delivering the final product, integrating ESG practises makes our operations more efficient, less resource-dependent, and more resilient”.

Rice explained: “The brewery is one of the clearest examples of how we embed ESG into the heart of operations” and described how it “runs on iREC-certified renewable electricity and uses biomass-powered steam to eliminate carbon emissions from production”.

Plus, as she pointed out that at Phu Bai Carlsberg also “treats all of our wastewater through state-of-the-art systems and are on track to reach zero waste to landfill by the end of 2025 and net-zero carbon production emissions by 2028”.

Rice added: “Our group-wide ambitions remain clear, including net-zero value chain by 2040 and various targets for the end of this decade: zero carbon emissions at breweries, 100% recyclable, reusable, or renewable packaging, and global water efficiency of 2 hl/hl.”

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