Asahi Zeros in on Zero-Proof

The Japanese brewer looks to expand its lineup of alcohol-free beverages in the United States.

April 16, 2024

Asahi sees big opportunity in zero- and low-alcohol drinks as consumers cut down on drinking—so much so that the Japanese brewer predicts these alcohol-free options will generate half of the company’s beverage sales by as early as 2040.

Atsushi Katsuki, whose group produces beers including Asahi Super Dry, Peroni Nastro Azzurro and Pilsner Urquell, said the company was “planning to expand its lineup of alcohol-free beverages in the United States, one of the world’s biggest drinks markets, through investments in start-ups,” reported Financial Review.

“Asahi recently outlined an ambitious target to increase the share of beverages with 3.5% alcohol or less from about 10% last year to 20% of its product mix by 2030. Mr. Katsuki said he wanted to bring that to half by as early as 2040 or 2050,” Financial Review wrote.

Some opportunity lies in higher profit margins. The alcohol-adjacent category “has higher margins than soft drinks and non-alcoholic drinks can be more profitable than beer because they do not incur alcohol taxes,” Asahi said.

The value of the market for alcohol-free or low-alcohol beers is more than $13 billion, according to drinks analytics group IWSR. It forecasts the no-alcohol share of the overall alcohol market will grow to nearly 4% by 2027.

Ashai is eyeing U.S. expansion, mostly through acquisitions and startup mergers that would give it new technologies and the ability to produce more beverages in small volumes.

“The U.S. market is the best and biggest market for us, and it’s also the missing piece for us,” Katsuki said.

Other notable breweries have also launched or expanded non-alcohol product lines, including Sierra Nevada Brewing Co., and Keurig Dr Pepper, which invested $50 million in non-alcoholic beer company Athletic Brewing Company in 2022.

The surge in non-alcoholic options coincides with beer sales being on the decline as more Americans embrace a sober lifestyle — according to data from Beer Marketer's Insights (BMI), U.S. beer shipments were expected to fall to their lowest level in 25 years by the end of 2023 — after dropping more than 5% in the first three quarters of the year.