PepsiCo Food Manufacturing Facility, Wuhan

PepsiCo’s new food manufacturing facility is located in Wuhan, the

capital city of the Hubei Province, China. Plans to construct the
facility were announced in April 2011. PepsiCo
officially inaugurated the plant in July 2012.

The Wuhan plant is PepsiCo’s sixth food manufacturing plant in the

Greater China region and the first in central China.

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PROJECT TYPE
Food manufacturing plant

LOCATION
Wuhan, China

ORDER YEAR
April 2011

OPENED
June 2012
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Opening of the Wuhan plant is part of PepsiCo’s long-term growth

strategy in China.
PepsiCo’s new food manufacturing plant in Wuhan, China was
opened in July 2012.

The new plant is the first in central China.

The annual capacity of the p

lant will be 15,000t of Lay’s potato chips.

Opening of the Wuhan plant is part of PepsiCo’s long-term growth
strategy in China.

PepsiCo’s new food manufacturing plant in Wuhan, China was

opened in July 2012.
PepsiCo’s new food manufacturing facility is located in Wuhan, the
capital city of the Hubei Province, China. Plans to construct the
facility were announced in April 2011. PepsiCo
officially inaugurated the plant in July 2012.

The Wuhan plant is PepsiCo’s sixth food manufacturing plant in the

Greater China region and the first in central China.

"PepsiCo plans to become one of the biggest snacks and beverage

players in China."
The new plant is an important part of PepsiCo’s long-term growth
strategy in China. As part of this strategy, PepsiCo announced in May
2010 its intention to invest $2.5bn in China over three years. This was
in addition to a previously announced investment of $1bn in 2008,
which concluded in 2010.

PepsiCo plans to become one of the biggest snacks and beverage

players in China. The Wuhan plant will help the company to explore
and expand its presence in the central and western regions of China.

Around 1,000 jobs were generated with the opening of the plant.
PepsiCo Wuhan plant details

The new food plant has been built on a 16 acre site located in the
Wuhan Food Industrial Processing Zone. It has a built up area of
25,000m².

The plant will produce PepsiCo’s Frito-Lay products such as Lay’s

potato chips and Lay’s Stax. The advanced potato chip production
system of the plant will enable it manufacture 15,000t of Lay’s potato
chips annually.
Potato chip products tailored to the Chinese market

Lay’s is one of the top brands in China. PepsiCo has altered the name
of the brand to Le Shi meaning happy moments. By changing the
name, PepsiCo is able to give local meaning to its products.

PepsiCo has also tailored its products to suit the Chinese palette and
introduced various local flavours to the Lay’s brand. The current
flavours available in the market are fresh cucumber, baked lobster,
peking duck, hot and sour fish soup, fried prawn and little tomato.

Chinese people are also known for sharing their food. PepsiCo,
therefore, redesigned the packaging of its Lay’s Stax products by
including a plastic tray inside the canister. This redesign reduces noise
and also helps in keeping the customers’ fingers clean.

The plant will produce PepsiCo’s Frito-Lay products such as

Lay’s potato chips and Lay’s Stax."
Sustainability features of the Chinese food plant

The new plant is the first such facility to be Leadership in Energy and
Environmental Design (LEED) certified in China.

The facility will conserve 30% of water and 20% of energy compared
to PepsiCo’s 2006 baseline for production facilities in China. To
achieve this, the company has installed solar arrays which will power
water boilers. Skylights will provide ample lighting for the plant,
thereby reducing energy costs.

In addition to the Wuhan plant, PepsiCo operates three bottling plants

in China which are also LEED-certified. These plants are located in
Chongqing, Nanchang and Kunming.
PepsiCo’s market strategy in China

Based on estimates from Euromonitor International, the Chinese

snacks market is estimated to be worth $70.3bn. PepsiCo entered
China in 1981. The company already holds 3.5% market share in the
Chinese snacks market. It operates 27 food and beverage plants in
China and is the fifth largest company in the market, behind the Want
Want Group.

PepsiCo plans to open 14 more plants in the future and also expand its
existing facilities. All the new facilities will be built to LEED
standards. The company has already formed an alliance with Tingyi
Holding Corporation to target the drinks market in China.

Agricultural development is another area PepsiCo plans to focus in

China. The company is one of the largest producers of potatoes in the
country. It has already established eight sustainable demonstration
potato farms in China and introduced advanced irrigation
technologies. PepsiCo plans to invest in establishing five new farms
which will produce potatoes and oats.

PepsiCo’s new food and beverage research and development

centre is located in Shanghai, China. The state-of-the-art facility,
which was opened in November 2012, is PepsiCo’s largest
innovation centre located outside of the United States.