End Game for Beer

This graph illustrates the tremendous challenge faced by major U.S. breweries. Today's announcement that SABMiller and MolsonCoors (TAP) are consolidating their U.S. operations into a joint venture follows naturally.

At this point, major U.S. breweries are forced into finding ways to efficiently produce "sub-premium beer" (the character of the name says it all). The decline is this category is stunning. Yet, the consumers in this category are the most loyal of any category. So the U.S. breweries are looking for a way "to have your beer and drink it too."

One topic to study is how the proposed joint venture is structured. If the arrangement is feasible, we might see other joint ventures. Anheuser-Busch and Heinekein are both family-controlled and operated concerns. A workable joint venture would allow them to retain independent identity and cut costs.