Thai energy drink maker Carabao Group is preparing to mount a full-on challenge to the country’s two dominant beer brands, Singha and Chang, as changing consumer tastes and the easing of brewing restrictions create an opportunity to break into the market.
Carabao will invest up to 6 billion baht to install brewing equipment at group company’s factory in central Thailand’s Chai Nat. It plans to first secure a production capacity of 200 million liters per year, which will be increased to 400 million liters depending on market reaction. The company, whose flagship Carabao Dang beverage is the second most popular energy drink in Thailand, aims to reach 40 billion baht in annual beer sales in the next three to five years. In the battle of the labels, Carabao’s water buffalo logo will take on Chang’s elephants and Singha’s mystical golden lion.
Carabao has been eyeing a full-scale entry into the beer market for more than 20 years. It is not a complete newcomer — an affiliated company manages a restaurant that serves small-batch beers brewed in-house. The group has an alcohol segment that sells whiskey and other spirits.
The market has long been dominated by two conglomerates, Boon Rawd Brewery and TCC Group. Boon Rawd, which makes Singha, was established in 1933, while TCC, brewer of Chang, entered the market in 1995. Price competition from TCC spurred Boon Rawd to respond with the introduction of a lower-priced brand called Leo. As of 2020, Boon Rawd had a 57% share of the Thai beer market, followed by TCC subsidiary Thai Beverage with 34%, according to market research company Euromonitor. Their dominance had been assured by restrictions on brewing. The government had set limits on capital and annual production volume, making it difficult for new entrants, in a nod to cultural resistance to the consumption of alcohol in Buddhist Thailand. Calls to abolish the government’s restrictions from the Move Forward political party — which criticized them as protecting conglomerates — and craft beer businesses led to their partial easing in November 2022.
In November, it will release a low-priced beer called Carabao, carrying the same name as the energy drink, and a mid-priced brand Tawandang, named after the restaurant the company runs. The low-priced beer will be sold at 60 baht for a large bottle, about the same as for its two competitors. Tawandang will offer three types of craft beer, including an India pale ale.
