(Yicai) July 1 -- Carlsberg Group’s Chongqing Beer has begun brewing the alcoholic beverage in Malaysia, making it the first Chinese beer brand to produce overseas.

The first batch of Chongqing Beer cans rolled off the production line at Carlsberg Malaysia Brewery’s factory in Shah Alam, near Kuala Lumpur, last month, and they went on sale at 99 Speedmart, the country’s largest convenience store chain, around June 23, Chongqing Daily reported.

The product launched in Malaysia contains 3.8 percent alcohol, below the roughly 5 percent average of mainstream beers in the local market. This is to cater to the new consumption trend among younger drinkers who increasingly associate lower alcohol content with healthier and more refreshing beverages, Stefano Clini, managing director of Carlsberg Malaysia, told Yicai.

Malaysia’s beer imports face both import tariffs and consumption taxes, which is why most beer brands in the country are produced locally, Clini said, adding that once brewed domestically, Chongqing Beer will gain a clear cost and pricing advantage over imported brands.

Malaysian customers are more loyal to well-known brands, but they are also willing to accept novelty and innovation, Clini pointed out. So Chongqing Beer’s immediate priority is to reach as many local consumers as possible to enhance its brand awareness, and Carlsberg Malaysia will help with that, he added.

Chongqing Beer will take full advantage of Carlsberg’s integrated supply chain, established production facilities, and market operations system in Malaysia, having operated there for 55 years. Malaysia was also Carlsberg’s first entry point into Southeast Asia.

The Danish brewer’s long-standing presence in Malaysia, particularly its strong brand influence within local Chinese communities, provides a favorable foundation for Chongqing Beer’s market entry, according to Xiao Zhuqing, a commentator the Chinese liquor industry.

Xiao believes that Chongqing Beer can rely on Carlsberg’s established factories, omni-channel distribution, and local regulatory compliance to quickly enter the Malaysian market and with relatively low risk, thereby avoiding the long timelines and regulatory hurdles that come with building new production facilities.

The move is a milestone in the globalization of Chinese beer brands, Xiao noted. In his view, it could help reshape the industry’s traditional model, which has long depended on foreign distributors, offered limited say in overseas markets, and relied heavily on low-priced original equipment manufacturing.

Carlsberg acquired its first stake in Chongqing Brewery in 2008 and became its controlling shareholder with a 60 percent stake five years later. After a 2020 asset restructuring, most of their brewery assets in China were handed to a joint venture, Carlsberg Chongqing Brewery, with Chongqing Brewery holding a 51 percent stake and Carlsberg indirectly owning the rest.

Editors: Tang Shihua, Futura Costaglione