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Taco Bell has renewed its partnership with PepsiCo for another decade, ensuring that PepsiCo's beverage lineup will remain available at Taco Bell locations through 2036. This decision comes shortly after sister chain KFC switched to Coca-Cola, ending its long-standing relationship with PepsiCo. The renewed agreement includes plans to introduce new drinks and flavors, such as Doritos Locos Tacos, which have been popular among consumers.
According to QSR Web, PepsiCo's exclusive Mountain Dew Baja Blast has become a billion-dollar brand, with more varieties expected to be released. The companies aim to expand their beverage offerings to include crafted, functional, and energy drinks that cater to emerging consumer preferences, particularly those of Gen Z.
Anne Fink, president of PepsiCo Global Away from Home, emphasized the importance of the partnership, stating, "Some of PepsiCo's best foodservice innovations have come from partnerships that challenge us to think differently, and Taco Bell has always brought that energy." Meg Farren, Taco Bell's president of North America, echoed this sentiment, highlighting the long-term growth potential for the Taco Bell brand.
The partnership will also continue internationally, with PepsiCo remaining Taco Bell's beverage partner in Canada, the United Kingdom, Ireland, and Thailand. The companies plan to develop localized beverage innovations tailored to these markets.
The decision to stick with PepsiCo is a significant win for the beverage giant, especially as its North American beverage business faces declining sales. Taco Bell aims to grow its beverage business to $5 billion by 2030, making this partnership crucial for both companies' future growth.