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Diageo breaks ground on Tequila expansion

Diageo has started expansion work at its Atotonilco production site in Jalisco, Mexico, following a US$400 million investment in Don Julio.

Don Julio production capacity will more than double with the expansion

Diageo broke ground last week to build a new 24,000sqm bottling facility, wastewater treatment plant and a maturation warehouse, as reported by Mexico News Daily.

Once the expansion work is complete Diageo says it will at least double its Tequila and vodka production to more than 5 million cases, with more than half destined for export.

Don Julio Tequila is expected to account for 80% of the output, with Smirnoff vodka taking the remaining 20%.

Diageo also has plans to bottle its Captain Morgan rum at the site, The Spirits Business understands.

The development will directly and indirectly create around 1,000 jobs, Diageo added.

Work at the site follows a $400 million investment pledge made after the company acquired the Don Julio Tequila band in 2015.

“This investment reaffirms our long-term commitment to Mexico and we look forward to playing a bigger role in the industry, investing in our people and communities and supporting wider economic development,” Diageo CEO Ivan Menezes said at the time.

Diageo has confirmed the expansion activity to The Spirits Business and is expected to disclose further details shortly.

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