Market Overview -
The global tequila market size was valued at USD 11.04 billion in 2023 and is projected to grow from USD 11.69 billion in 2024 to USD 18.58 billion by 2032, exhibiting a CAGR of 5.97% during the forecast period. North America dominated the tequila market with a market share of 62.14% in 2023.
Tequila is a distilled spirit from Mexico made from the juices of the Weber blue agave plant. According to the International Wine and Spirit Research (IWSR), blue agave plant distilled beverage has been the category's second-fastest-growing spirit in recent years, says Fortune Business InsightsTM in its report titled, “Tequila Market, 2024-2032”.
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Segmentation-
By Type, Blanco to Account for Major Market Share
On the basis of type, the market is divided into blanco, reposado, anejo, and others. Blanco variants account for a sizable portion due to their earthy, semi-sweet, distinct agave flavor. Its smoother taste and wide availability result in widespread consumption. The widespread use of blanco variants in various cocktails such as margaritas and Palomas contributes to the market's dominance.
By Grade, Premium Variant to be Leading Segment
The premium variant will lead the tequila market share as consumers demand high-quality craft spirits. The premium-grade spirit combines desirable characteristics that consumers value, such as sensory appeal, mouthfeel, and texture. The demand for such luxury spirit variants is primarily driven by millennials and young adults.
By Distribution Channel, On-Trade Sales to be the Major Distribution Channel
The on-trade sales channel is one of the most prominent alcohol sales channels, and it is expected to dominate the market share. Consumers prefer quick servings, entertainment, and ambiance in developed economies, driving on-trade sales. However, the off-trade channel is expanding rapidly because purchasing alcohol from supermarkets, and brick-and-mortar stores is much more cost-effective.
Geographically, the market is divided into North America, Europe, Asia Pacific, South America, Middle East & Africa.
Report Coverage-
The market research report contains both qualitative and quantitative information about the market. It also provides a detailed analysis of the market size and growth rate for all possible market segments. The key insights presented in the tequila market report are an overview of related markets, recent industry developments such as mergers and acquisitions, the regulatory scenario in critical countries, and key industry trends.
Source: https://www.fortunebusinessinsights.com/tequila-market-104172
Drivers & Restraints-
Market Growth is driven by Consumers' interest in New Flavors and Exotic Tastes
One of the major factors driving demand for blue agave plant-based distilled spirits is the growing popularity of various artisanal spirits among consumers worldwide. Consumers worldwide want fresh and delicious exotic drinks with a distinct flavor, propelling the market growth. However, in recent years, as we have seen an increase in spirits consumption, particularly in developing regions, developed countries have predicted a shift in consumer preferences toward low and no alcoholic beverages. Their growing awareness of the negative effects of alcohol consumption has led them to seek out low or no alcohol drinks that taste just like alcoholic beverages but without the negative consequences. This factor may impede the tequila market growth.
Regional Insights-
North America Held the Dominant Position in the Market
North America dominated the market in 2021, with a market value of USD 6.09 billion. This is due to a growing consumer preference for agave-based spirits in the U.S. and Mexico. According to the Distilled Spirits Council of the U.S., agave-based spirits sales will increase 30.1% to USD 5.2 billion in 2021.
The European market is expected to grow significantly due to the increasing popularity of artisanal spirits in Germany, Spain, and the U.K. with its craftsmanship, heritage, and protected status, tequila is well-positioned to benefit from the region's popularity of craft spirits, where more drinkers are looking to 'drink better and turning to premium brands.
In the Asia Pacific, the spirit has gained popularity among consumers, particularly millennials in China and Australia. Increased imports and consumers seeking quality over quantity and preferring small-batch spirits have fueled the market growth.
Alcohol consumption is increasing in Latin American countries such as Brazil and Argentina, which will likely contribute to the region's overall performance. Premiumization and innovation trends in white spirits are observed in the Middle East and Africa, supporting tequila market growth.
Competitive Landscape-
To Remain Competitive, Companies Need to Introduce New Variants
Due to the product's extensive production in Mexico and the United States, the market is moderately consolidated. Along with this, prominent players are innovating and launching products worldwide. Companies like Bacardi & Company Ltd., Diageo Plc, and Pernod Ricard S.A. focus on new product development and increasing exports to diversify their product portfolio and maintain a competitive advantage.
Notable Industry Development-
February 2022: Avión Reserva Cristalino Tequila has been added to Pernod Ricard's Avión portfolio. The company has created a product that honors every step of its production process from field to bottle, highlighting the uniqueness of its terroir, the character of agave, the purity of distillation, and the delicate relationship with wood during aging.
List of Key Market Players:
● Pernod Ricard S.A. (France)
● Diageo Plc (U.K.)
● Bacardi Limited (Bermuda)
● Suntory Holdings Limited (Japan)
● Heaven Hill Distilleries, Inc. (U.S.)
● Campari Group (Italy)
● Sazerac Company Inc. (U.S.)
● Brown-Forman Corporation (U.S.)
● Casa Aceves (México)
● Constellation Brands, Inc. (U.S.)