NESPRESSO – New plant opens in Avenches

MILAN – Nestle opened Wednesday a second Nespresso factory in Avenches in canton Vaud of its popular Nespresso coffee brand, to meet fast-growing global demand for its coffee capsules.

The Swiss food giant said the new site cost 300 million Swiss francs (US$278 million).

The state-of-the-art plant will start with annual production of 4.8 billion capsules, with the capacity to double production to near 10 billion capsules within three years, the company said.

Nestle’s fastest-growing product recorded average sales growth of more than 30 percent over the last eight years and the company is confident to reach double-digit growth also this year despite the economic crisis, according Nespresso’s Chief Executive Officer Richard Girardot.

Nespresso saw sales growth slow to somewhere in the 20s in the first quarter of 2009. Girardot said the trend had stayed about the same and he expected a similar rate for the full year.

Girardot noted that 90 per cent of sales are in Europe compared with just five per cent in the Americas and five per cent in Asia. He said Nespresso also hoped to break into tea-drinking China, focusing on big cities like Shanghai and Beijing.