The brewer is temporarily closing its Quang Nam brewery, the smallest of its six facilities, amid declining demand

Heineken has announced plans to temporarily shut down one of its breweries in Vietnam due to a significant decline in beer demand.

The brewery, located in Quang Nam province, is the smallest of Heineken’s six facilities in the country and has been operational since 2007.

The move to suspend operation comes amid ongoing challenges in the Vietnamese beer industry, which has been severely impacted by the economic fallout from the COVID-19 pandemic, stricter drink-driving laws, and the likelihood of an increase in consumer tax.

Beer sales in Vietnam saw a double-digit decline in 2023 and have continued to fall at a mid-single-digit rate in 2024.

Despite these obstacles, however, Heineken reported an increase in underlying revenue in Vietnam for the first quarter of the year, driven by volume growth and overcoming last year’s destocking efforts.

Heineken cited the economic slowdown, which has weakened consumer confidence and demand, as a primary reason for the brewery closure.

Additionally, the strict enforcement of Decree 100, which imposes severe penalties on drink-driving and enforces a zero alcohol limit for drivers, has led to a notable shift in consumer drinking habits, further reducing beer consumption.

In a document submitted to provincial authorities, Heineken emphasised that the temporary closure is a strategic move aimed at optimising its brewing and business activities.

The company seeks to enhance efficiency and achieve economies of scale, allowing it to continue investing in the Vietnamese market while supporting its overall workforce and sustaining business operations and the value chain.