Molson Coors will cease operations at the Leinenkugel’s Chippewa Falls brewery and the company’s Tenth Street Brewery in Milwaukee, effective January 17.
Brian Erhardt, EVP and chief supply chain officer, shared the news in a note to the company’s distributor partners Wednesday afternoon, noting that production from the two Wisconsin facilities will transition to Molson Coors’ brewery in Milwaukee.
“We made the decision to close Tenth Street in Milwaukee in light of the sale of the Tenth & Blake breweries, as production at the facility included 19.2 oz. cans of those brands,” Erhardt wrote, referring to the sale of Atwater Brewery, Terrapin Beer Co., Hop Valley and Revolver to Tilray Brands earlier this year.
“We will transition production of 19.2 oz. cans of Blue Moon and other continuing brands to the Milwaukee Brewery, made possible through a can line investment at that facility,” he continued.
“In the case of Leinenkugel’s, this move follows the gradual shift of production of Leinie’s brands from Chippewa Falls to Milwaukee as the portfolio has grown over the years; Milwaukee already produces more than 75% of total Leinenkugel volume.”
The expiration of Molson Coors’ contract brewing arrangement with Pabst Brewing at the end of the year also made it possible for the Milwaukee production brewery “to absorb this incremental volume,” Erhardt wrote.
Molson Coors’ Milwaukee brewery produces around 5.7 million barrels annually of 42 brands and 375 SKUs, according to a 2022 fact sheet. The brewery employs around 629 workers.
Erhardt stressed that Leinenkugel’s brand remains a “cherished part of our company and culture,” as it has since the craft brand’s 1988 acquisition.
“That’s not changing,” he wrote. “Leinie’s Summer Shandy and the rest of the portfolio will continue to play a critical role in our premiumization strategy.”
Summer Shandy is now a year-round offering. Erhardt added that the Leinie Lodge and pilot brewery in Chippewa Falls will remain open, and Molson Coors has “no planned changes” for the J. Leinenkugel’s Barrel Yard brewpub at American Family Field, the home stadium of the Milwaukee Brewers.
Molson Coors declined to share how many employees are affected by winding down production at the two breweries.
“While never easy, these choices are made with much thought and consideration for our business and the employees impacted,” Erhardt wrote. “I want to thank the Tenth Street and Chippewa Falls brewery teams for their years of dedication to our business. We have started conversations with both salaried and hourly employees, as well as their respective bargaining representatives.
“We remain committed to handling these changes in a way that is respectful and providing impacted employees with all needed information and available resources.”
Dollar sales of the Leinenkugel’s brand family have declined -9.4% in the latest 52-week (L52W) period ending October 5 at off-premise retailers tracked by NIQ, according to data shared by 3 Tier Beverages. Those trends accelerated slightly to -9.9% in the L26W, but began to reverse to -4.6% in the L13W.
In the L4W through October 5, Leinenkugel’s dollar sales increased +5.7%, and volume (case sales) increased +3%.