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This summer was a bright moment for Europe\u2019s brewers. Hot weather and the FIFA World Cup packed out beer gardens, and in Britain, the night that England beat Panama was pubs\u2019 busiest of the year, with card transactions five times the daily average, according to Barclays.\u00a0<\/p>\n
But behind the sunny terraces, a longer slump has been brewing. European consumers drink less beer than they did before the pandemic. Consumption fell 3.2% in 2025 and is down 9.2% since 2019, according to a report by the industry trade body Brewers of Europe.\u00a0<\/p>\n
The slump has been pinned on sober-curious Gen Z drinkers and, more recently, weight-loss drugs like Ozempic. Glenn Caton, Europe president at Heineken, the world\u2019s second-largest brewer, points to costs. \u201cThere\u2019s no question that price inflation has impacted consumer consumption over time,\u201d he told Fortune.\u00a0\u00a0<\/p>\n
Brewers had barely recovered from the pandemic when Russia\u2019s 2022 invasion of Ukraine sent energy and grain prices soaring. \u201cClearly raising prices has been necessary,\u201d Caton said. Heineken raised what it charges British pubs for draught beer by 2.97% in February 2025 and another 2.7% this February. The average U.K. pint rose 17p to \u00a35.34 in the year to April, according to The Morning Advertiser.\u00a0<\/p>\n
Although Heineken returned to growth this year, volumes rose 1.6% in the second quarter of 2026, this was not thanks to European drinkers. While beer sales in Asia Pacific and Africa and the Middle East rose, in Europe they\u2019ve been falling.\u00a0Across Europe and the U.S., Caton said, beer is in \u201cstructural decline.\u201d\u00a0<\/p>\n
Cutting costs\u00a0<\/p>\n
Europe is Heineken\u2019s biggest region by sales but has its thinnest margins. Europe brought in nearly two-fifths (38.4%) of first-half sales but only a quarter of operating profit. Having already raised prices in the region, Caton is now focusing on cutting costs.\u00a0<\/p>\n
In February, Heineken announced plans to cut up to 6,000 jobs globally over the next two years under EverGreen 2030, a strategy that aims to save the company up to \u20ac500 million a year ($559 million) and boost profits by focusing on its fastest-growing markets. The savings, Caton says, are also meant to offset rising energy and raw-material costs so the company can \u201cmitigate price inflation for the consumer.\u201d \u00a0<\/p>\n
About 3,000 jobs were cut in the first half of 2026, and chief financial officer Harold van den Broek has signaled that Europe will bear much of the burden. \u201cEurope is a big component\u201d of the cuts, he said at the half-year results in August.\u00a0\u00a0<\/p>\n
Glenn Caton, President Europe at Heinken<\/p>\n
Heineken, 2026<\/p>\n
Caton declined to say how many European jobs will go, citing ongoing consultation with staff and the European Works Council. Some of the changes will see roles move to Heineken\u2019s business services hubs in places such as Krak\u00f3w and India. \u201cYou never like to make difficult decisions that impact people you know and respect,\u201d Caton said, \u201cbut it is necessary for the health of the company.\u201d\u00a0<\/p>\n
Heineken is also merging nine country businesses into four multi-country operating units in Europe, including one bringing together Belgium and the Netherlands and another for Germany, Austria, and Switzerland. Caton says this is a departure from Heineken\u2019s traditionally local-first way of operating. The aim, he said, is a business that is \u201clean, fast and agile,\u201d with costs low enough to offer drinkers better value.\u00a0\u00a0<\/p>\n
The overhaul also ran for nine months without a permanent chief executive. Rafael Oliveira took over on Oct. 1, but Caton insists the plan never slowed and that the new boss is there to help execute. \u201cIt\u2019s not about a radically new strategy,\u201d he said. \u201cMy job is to run Europe, and hopefully he\u2019ll let me get on with that.\u201d\u00a0<\/p>\n
Growing the non-alcoholic pie\u00a0<\/p>\n
To keep drinkers who trade down, Heineken sells at every price point, from premium Birra Moretti to mainstream Cruzcampo and budget Foster\u2019s. It is also betting on alcohol-free beer, which lets drinkers cut back without leaving its brands. Zero-alcohol beers, Caton said, is \u201cenabling more consumers to moderate the decline in alcohol.\u201d\u00a0<\/p>\n
Before Heineken 0.0 launched in 2017, the category\u2019s big problem \u201cwas taste,\u201d he added. Heineken\u2019s version, designed to taste \u201cnear identical to the original\u201d and backed by a Formula 1 sponsorship, is now one of the leading alcohol-free beers. The group\u2019s low- and no-alcohol volumes rose 12% in the first half of 2026. Competition in the alcohol-free beer market is growing. \u201cIt makes our job harder,\u201d Caton added, \u201cbut for the category overall, it\u2019s a good thing, because it\u2019s growing the whole pie.\u201d\u00a0<\/p>\n
Alcohol-free accounts for one in 12 beers drunk in the EU, according to Brewers of Europe, and Carton admitted that take-up is uneven across the continent. As a result Heineken is innovating \u201cin both directions,\u201d with flavored 0.0s such as Lemon & Elderflower in the U.K., an orange Cruzcampo, and lagers of around 3.5% alcohol, below the usual 4.5% to 5%.\u00a0<\/p>\n
Pubs and bars make up about half of Heineken\u2019s European business, according to Caton. In the U.K., it owns about 2,350 pubs through Star Pubs & Bars, mostly leased to independent operators, and is reportedly in talks to acquire Stonegate as part of a \u00a3300 million ($396 million) deal, which would add around 300 more pubs to its portfolio. Caton said the deal is still ongoing.\u00a0\u00a0<\/p>\n
\u201cGood pubs in the U.K. are thriving,\u201d Caton said. \u201cPeople still want to socialize physically.\u201d The numbers only partly back him up. British pubs are struggling, with 161 shutting in the first quarter of 2026, up 26% on a year earlier. But the British Beer & Pub Association blames tax and overheads, and across the EU, the share of beer drunk in pubs, bars, and restaurants has stopped shrinking after years of decline.\u00a0<\/p>\n
Heineken is also making the case that bars are a key part of the economy. Tourists spend almost \u20ac2.5 billion a year on its beers, it estimates, mostly in pubs and bars, and 35% of tourists in a survey the brewer commissioned said they had visited a neighborhood specifically because of a local bar.\u00a0<\/p>\n
For Caton, returning Europe to growth will be reliant on creating more value for consumers by reducing the price of drinks in both shops and bars and creating new low-alcohol options for health-conscious consumers. \u201cIf you offer great value and a great experience, you bring punters in the door,\u201d he said. And he isn\u2019t worried about beer itself. \u201cIt\u2019s been around 5,000 years. It\u2019s not going anywhere.\u201d\u00a0\u00a0<\/p>\n
#Europeans #drinking #beer #Heinekens #Europe #boss #plan<\/p>\n","protected":false},"excerpt":{"rendered":"
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