Diageo plans billion-pound investment in Scotch whisky

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Diageo is to invest more than £1bn in Scotch whisky production over the next five years to meet growing global demand.

The Johnnie Walker maker is to build a new malt distillery and expand some of its existing distilleries, and will consider developing a second new distillery if global demand for Scotch is sustained at expected levels.

Diageo also plans to invest in new warehousing to house the millions of additional litres of Scotch produced by the extra investment.

The news comes three months after the Scotch Whisky Association revealed that exports of Scotch hit £4.2bn last year.

The US market grew 31% year on year to £654.9m, with sales in France up 27% to £535.4m.

Growth in countries across Asia and Latin America had been boosted by affluent young professionals getting a taste for Scotch, claimed the SWA, with exports to Singapore, which served as a distribution hub for much of Asia, up 44% to £317.9m. Sales to Brazil rose 48% to £99.2m.

“This is a pivotal moment in the development of the Scotch whisky category for Diageo,” said chief executive Paul Walsh. “Over recent years our brands have achieved remarkable, sustained global growth and we expect that success to continue, particularly in the high-growth markets around the world.”

The investment will create more than 100 new jobs within Diageo and the company predicted the knock-on effect of the move would generate around 500 further jobs. Diageo also intends to make a contribution to tackling youth unemployment by taking on 100 apprentices and graduate trainees over the term of the investment.

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