PepsiCo to open second snack plant in Russia

By Karen Willmer

- Last updated on GMT

Related tags: Pepsico, Chief executive officer

PepsiCo will build a second snack manufacturing plant in Russia to
meet the growing demand in the country.

The new plant will be based at Azov in the Rostov region. PepsiCo existing plant in Kashira was built in 2002. PepsiCo's general manager for snacks in Russia, Paul Kiesler, said business in the country has been growing quickly. With the $160m (€120m) plant at Kashira running at full capacity, the company will be investing another $170m (€127m) into the new plant over the next five years in the hope of expanding sales throughout Russia. "The second site in Rostov will provide us with the necessary manufacturing capability to meet growing consumer demand for our products,"​ Kiesler said. Michael White, chief executive officer of PepsiCo's international operations, said Rostov was chosen due to its good transport network, and the availability of land. White said the company had worked with Rostov's governor to ensure "the best possible site and ensuring access to the necessary infrastructure"​. PepsiCo said it will invest in local development programmes and source ingredients locally. At the Kashira plant, the company plans to buy all of its potatoes from local sources over the next few years. About 80 per cent currently comes from local farmers. The same policy will be used at the Rostov site, where the company says it will create 1,000 new jobs and invest in local farmers to encourage higher yields and better quality crops. PepsiCo has had beverage operations in Russia since 1974. PepsiCo's snack manufacturing plant in Kashira currently hires 1,600 workers. It is one of the largest snack manufacturing plants in Russia and continental Europe, claims PepsiCo. PepsiCo had annual revenues of $35bn in 2006. The group said its total investment in Russia currently amounts to €455m.

Related topics: PepsiCo, Markets

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