May 23, 2023
Coca-Cola has selected New York State as its “preferred location” for a new Fairlife production facility costing an estimated $650 million, Governor Kathy Hochul (D) has announced, reports Food Dive.
The 745,000-square-foot facility—to be located in Webster, New York, a suburb of Rochester—is expected to create up to 250 new jobs. Coca-Cola expects to break ground on the project this fall and to have the facility operational by the fourth quarter of 2025. It will be the largest dairy processing plant in the Northeast.
Fairlife has been a big winner for Coca-Cola recently as the beverage giant evolves into a “total beverage company” and invests in brands that have a long runway for growth. Last year, Coca-Cola said Fairlife topped $1 billion in annual retail sales for the first time.
During CEO James Quincey’s tenure, Coca-Cola has purchased or acquired the remaining stakes in brands it didn’t already own—including Fairlife, sparkling water offering Topo Chico, and sports drink line BodyArmor.
Coca-Cola acquired the remaining stake of Fairlife, which makes ultra-filtered milk and dairy products, from its joint venture partner Select Milk Producers, a dairy cooperative, in 2020. Coca-Cola previously owned a 42.5% minority stake. Financial terms of the deal were not disclosed.
The ultra-filtered milk process removes the lactose and much of the sugar, and leaves behind more of the protein and calcium.
Fairlife, which launched in 2012, started with a high-protein milkshake aimed at athletes and has since expanded into other value-added dairy products, including its popular milk and ice cream.
“Consumer demand for Fairlife products is at an all-time high, and a new production facility will allow us to significantly increase capacity and deliver fairlife to even more households across the country,” Tim Doelman,Fairlife’s CEO, said in a statement.
He added that as the brand continues its expansion in the Northeast, the New York location’s proximity and access to dairy farmers “make it an excellent location to support our next phase of growth.”
Coca-Cola is the latest large CPG company to build a new plant or expand an existing facility to prepare for an increase in sales of a product. Mondelēz International, Nestlé, J.M. Smucker, and Post Holdings are among the food and beverage to make multi-million-dollar announcements in recent years.
Research contact: @FoodDive
