(Yicai) Oct. 27 -- Kweichow Moutai has appointed Chen Hua, director of Guizhou province’s energy bureau, as the Chinese state-owned liquor giant’s fourth chairman in five years amid falling prices and shifting consumer preferences.

Zhang Deqin has stepped down as chairman and will be succeeded by Chen, Zunyi-based Kweichow Moutai announced during an internal meeting on Oct. 25, without disclosing the reason behind the change.

Chen, born in 1972, has held managerial posts at several state-owned firms and worked in the Guizhou government, but has no prior experience in consumer goods companies. He was appointed general manager of Panjiang State-owned Capital Operation in 2017 and became director of Guizhou’s energy bureau in 2022.

The latest leadership change may be aimed at helping Kweichow Moutai better respond to big changes in the liquor industry, including falling prices of baijiu, Cai Xuefei, general manager of Zhiqu Marketing, told Yicai.

Baijiu, a traditional fiery white spirit, is 40 percent to 65 percent alcohol by volume or even higher. It is most often consumed at social gatherings, banquets, and celebrations, but demand has been softening, with younger drinkers shifting away from strong tipples, according to reports.

The new chairman’s key challenges include keeping core product prices stable, balancing interests with sales partners, and navigating the wider restructuring of the liquor sector, Caid said, adding that near-term efforts will focus on halting price drops and maintaining distributor confidence.

Industry insiders were surprised by the departure of Zhang, who had only become chairman in April last year and has spent most of his career at the company. During his tenure, he took a series of steps that have stabilized operating performance to a certain extent, the insiders pointed out.

Kweichow Moutai's first-half net profit rose 8.9 percent from a year earlier, while operating revenue jumped 9.2 percent.

Kweichow Moutai’s history has also been punctuated by corruption issues. Since 2011, three former chairmen have faced investigation. Yuan Renguo and Gao Weidong have been sentenced to life in prison, and the case involving Ding Xiongjun is still under investigation.

Editors: Tang Shihua, Martin Kadiev