Diageo Joins Bourbon Boom

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(Pictured from Left to Right: Larry Schwartz (Diageo North American President), Kentucky Governor Steve Beshear, and Tom Bulleit (Master Distiller))

By Justin Thompson

 

The World’s largest liquor company, Diageo, hosted a ground-breaking ceremony today in the rural countryside of Shelby County, Ky to announce its intention to invest $115 million over three years for the building of a distillery and warehouse operation that will be officially known as the Bulleit Distilling Company. This initial investment will include a 1.8 million proof gallon (750,000 9-liter cases a year capacity) still and six barrel storage warehouses while adding at least 30 full-time positions.

Speakers from the local government (including Kentucky Governor Steve Beshear) and Diageo’s upper management both raved about Tom Bulleit’s commitment to his namesake brands (Bulleit Bourbon and Rye) and how his determination has turned them into some of the fastest growing and established Bourbon and Rye whiskey brands in the world. Diageo North American President Larry Schwartz even admitted that he didn’t want to launch Bulleit Rye, but was convinced to do so by Tom. Bulleit Rye is now considered by some as the leader in Rye whiskey market share in the world.

While it’s not official, a source shared with The Bourbon Review that the old still at Stitzel-Weller Distillery (which is also owned by Diageo) could be repurposed or even melted down so the metal could be used to construct the new column still at this facility. Tom Bulleit also believes that this could be the largest still built in America in the last 75 years.

While finalization of these plans is still subject to approval by local government, the project will represent a significant investment in Kentucky’s growing Bourbon industry. As of now, there are over 5 million barrels of Bourbon aging in Kentucky. Diageo already holds the title of owning the largest Scotch (Johnnie Walker) and Canadian (Crown Royal) whiskey brands in the world, so their expansion into Bourbon operations has been suspected by analyst and industry experts for years.

Over the last year, Diageo’s momentum in North American Whiskey has accelerated with both flagship and new-to-world brands. Fuelled by flavor innovations and consumer demand for premium brands with authenticity, Bourbon is currently the fastest growing spirits category in the U.S., enjoying 14% value growth for the latest 52 weeks. This popularity is mirrored globally, with the super-premium price segment growing 24% over the last three years.

The 300 acres of property the Bourbon Distilling Company will one day operate on, will include plenty of space for expansion. Diageo’s North America Supply President Paul Gallagher shared, “One of things Tom (Bulleit) and I did when looking at this facility and its potential. We do have the capability at this facility to grow even bigger.”

The proposed distillery will be designed to fit in with the surrounding countryside and during construction Diageo will take measures to conserve the natural landscape in the area.  Approximately 100 acres of land around the property line will act as a natural barrier to site operations.  Diageo North America has a strong record of achieving zero waste to landfill in its operations, and the company aims to achieve the same in Kentucky. Tom Bulleit pledged, “This will be the most environmentally friendly distillery and neighbor to Shelby County.”

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